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“Meritocracy” in mergers and acquisitions. (F&A)

Just today the media has jumped on the news of the merger ANTENNA 3 SIXTH and absorbing the former over the latter, so the discussion that follows is particularly relevant.

We have seen in previous entries that meritocracy should be integrated into the DNA of the company, yet it is precisely the meritocracy of the values ​​most is eroded in the process of mergers and acquisitions (F&A).

Historically small businesses that have the spark of a successful invention or developments that make them leaders of a certain market, are of desire for other larger companies with greater financial muscle or. This leads to acquisitions that add value when they respect unquestionable summation parties and are not destroyed equipment and concepts that led to success in the acquired company.

It is true that in cases of acquisitions of companies offer pre-bankruptcy unfortunate situations or general bad situation, it makes sense to eliminate forever the bad corporate image acquired. However the most common is the acquisition of companies in local or national full success by large multinational companies with aspirations to increase its market share.

Not infrequently the aforementioned success by brand awareness or sales volume that feeds the appetite of the acquiring firm is the result of a forced expansion policy to present stunning sales figures , market share, capillary sales network, etc, etc., have capitalized the company, or at least hurt their financial ratios. I had access to cases of contracts with vendors over market conditions in order to present the buyer with a strong sales network in the sector, or cause undesirable price wars and sometimes "dumping" to improve its market share. Even certain illegal practices such as billing anticipate, postpone the execution of requests for churn, malpractice or other financial engineering are typical in these operations where often the end justifies the means for many managers who hide in obedience.

Furthermore, and fortunately I lived very near success stories where the forms were basically respected. The company maintained its original name acquired and integrated into the business constellation taker with the following sentence under maintained their historic logo : "A Group Company XXX". This will clearly communicated to customers belonging to a powerful new business group, although the team remained without losing the historical personality, thus adding more products, more picture, refined and updated procedures; ultimately more quality across the broadest sense of the concept.

But well into the '80s and '90s extensively in today, large corporations already under strong influence of consulting companies and their standardized "Manual of the consultant" , which recommended the mergers and acquisitions as a tool for shareholder value. It was the opportunities offered by the different markets for the sale represent significant benefits for both shareholders and groups the opportunity to realign positions in the new organization where new people often appear unexpectedly in the world of .

This increase in shareholder value is often true, but sometimes the make-up or operation to achieve artificially sobrepromociona. And skilled consultants (with “skills” say in English) get it cleverly.

Also typically more profitable by supplying products and markets and, above all, by downsizing. In this regard, TOPs apply the "manual of the consultant" as mimetic declaring the merger, absorption, acquisition, reorganization,Behave ... no job cuts. This is not a falsehood but a half truth, because in the first phase usually lasts about a year, there are no redundancies inevitably occur after. The TOPs take out the operation without hot scandal, and cuts are made in stages later in cold.

Materializes once the operation begins the dance of interests between managers, other employees while waiting the movements observed, and sometimes finds in a way that never could have imagined, the true nature of bosses and colleagues who act out their ambitions. start rumors, grapevine, coffee machine and meals for discrete soar Managers. The TOPs try to calm with a politically correct statement announcing how happy and productive will be the event. Nor lie, because only cite the benefits without drawbacks mentioned.

Finally is the first official release of the new organization to which, at successive 3 months, are following others launched by the newly nominated with charts and details. A quarter is usually the time set to define the organization as the "manual of the consultant".

No more rumors and the uncertainty of. What follows is worse. Begins "Ethnic cleansing" between the two cultures merged business. Managers and employees of both cultures , often duplicate or at least overlapping, fight to keep their jobs at all costs.

TOPs and materialize their new positions and prevendas, bonus, stock options,parachute retirements and dismissals if any of the new corporation ... in fact no longer a priority as turnover, market share and everything so both fought and argued. Now the priority of Management and other employees is to maintain the position adjustments to the inexorable “head counts” to be prepared in the near future.

To remedy these situations the "manual of the consultant" should create the figure of “Integration Manager”, which usually devolve upon a relevant manager but did not get a job at their level in the new organization, and which is entrusted with the coordination and processing of both cultures.

These issues are magnified when it comes to financial and industrial corporations in key sectors / strategic. The corporate lobbyists and their political managers take the reins involving the country's political, and the operation is complicated and poisons in excess. It is not our intention to enter into these matters in such a high level.

As seen, in my opinion, processes F&A merger / acquisitions, rearrangements even within a large corporation, movements are subject to Management and other employees who rarely have anything to do with meritocracy. Is, and abounding in my personal opinion, often result in significant injustice and loss pride of belonging honest professionals in organizations, be well focused on his own, not know their way in the shifting terrain of enterprise policy.

If the present is a process of F&A, as I happened to live in all, I do mean, in all multinationals in which I was honored to serve, is that you be-you-own the company and defendáis your loyal conviction, unless it will behave in a risk of permanent, in which case not signify in any way is the best option during the reorganization process.

And, care, if you have been nominated for the above function Begin Integration Manager to extend pseudopodia for your social networks and seek you out a new position.

I fear that the “meritocracy” has no future in processes F&A purity and realize that in these operations is not an easily attainable objective, However in parodying the Roman mi friend, If I were President boost a thorough review of legislation and taxation for mergers and acquisitions in order to reaffirm the absence of impunity in cases of false documentary, offenses against the rights of workers and offenses against the public, not forgetting to any forward-looking approach to downsizing and relocation of manufacturing.

Self-reflection

  • Have you experienced a process of F&A? What was your experience? Is it respected the "meritocracy”?
  • Have you experienced or know of reorganization with its pros and cons? Did respected “meritocracy”?
  • Do you think the benefit of "critical mass " good is placed as high as many multinationals seek or socially penalizes medium-sized enterprises and involves loss of jobs?

RECOMMENDED TOPICS

  • There are many examples of these themes in film, however I have chosen a Spanish success story. Authentic sample “Meritocracy” capitalized.

Joan is the Mila Garcia , EyeOS creator, who with 23 years has achieved a recognition award winning entrepreneur and admired by everyone who knows him.

I invite you to see the interview he did earlier this year on television and Buenafuente, if interested, to enter all related videos, as also attached to one of his lectures receiving his award from the hands of the Prince of Asturias.


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