The key to any well-made dish is arguably the ingredients. It’s about having the right amount of this and the right amount of that and the correct amount of time to ensure the melange is what you imagined. The same can be said about mergers and acquisitions (M&As). The advertising and marketing industry has seen massive consolidation in the past few years and the question is always: will the combination of companies be successful? While most may seek answers in the context of business success or profitability, the true answers actually lie within what should be at the heart of all companies – their people.
Don’t Underestimate the Power of People and Culture
People are at the center of any merger or acquisition. I learned that first-hand when I worked at Microsoft as part of the team that integrated advertising on Skype. We often jumped to questions about the product or service but at the core, the technology wasn’t what Skype was about at all. It was in fact a brand that was rooted in its people, and the Microsoft team misunderstood how meaningful that was to Skype. For example, it was underestimated what it meant to use a Mac computer for work, as was customary across the Skype team. The choice to use a Mac was intentional and simply not viewed by users as “just another device,” it was an entire mindset. During the integration, we quickly learned that asking and considering the different ways people worked – from their management style to their devices – was essential to success.
When two companies merge, it is not the integration of inanimate objects. It’s the unification of two groups of human beings, and that must be considered first and foremost. Too often we overlook the people component and obsess over the assets. However, by dismissing the importance of the people, the M&A loses value. Companies need to present a clear vision, timeline and roadmap for what will happen during the integration and must ensure that everyone feels a part of the process.
Collaboration is a Requirement
M&As do well when there’s mutual accountability for success, which means there must be a strong sense of collaboration. Collaboration, the act of working closely together and using each other’s strengths, must be woven into company culture for it to truly work otherwise it becomes another work-centered buzzword. It is about acknowledging other perspectives, other points of view, other skills and other strengths. Part of that is nurturing a culture where the company’s people understand that there is value in their unique experience. Another part is being aware that collaboration isn’t something that always happens naturally. Companies must be intentional about creating safe spaces and environments where people feel they can share their own particular outlooks and be heard.
The way leaders measure success when it comes to the health of a business is quite similar across industries and geographies. It revolves around traditional growth metrics — sales, revenue, client retention, client satisfaction, and a slew of other metrics. However, when measuring success when it comes to people, leaders need to be thoughtful and deliberate about what assessments should be taken into consideration.
The first misstep is equating work satisfaction with employee happiness. To be clear, happiness is not something an employer can provide as that is determined by many things, including life outside of the workplace. However, employers can provide their employees with work satisfaction, which is a core component of employee success. Work satisfaction is determined by clear roles and responsibilities, explicit paths for continual learning and development, and a direct plan around promotion and growth. Employers must design an experience that works for the things that employees find most important, which can vary from salaries and titles to having access to a variety of experiences across departments.
Leaders should also be sure to heed employee feedback. Too often, leaders ask their teams for their opinions and then fail to follow up with adequate support. Teams want to know that their feedback has been heard and that action has been taken against it. Companies like to use surveys, metrics around promotion, recruitment, retention, and many other analyses when measuring employee success. But much of that is useless without addressing continuous feedback to ensure real concerns are heard and the workplace improves and evolves.
M&As are the unions of people, culture, services and technology. Leaders who are considering that type of expansion must have people and the culture top of mind to be successful. They need to cultivate a sense of collaboration rather than cooperation among old and new teams while ensuring progress is being measured accurately both at the people and company level. Use metrics that matter, measure with intention and accuracy, and lead with transparency — that is how to evaluate and ensure success across the board.