Working Wounded: Making the Most of Mergers
March 10, 2006 — -- DEAR WOUNDED: I've heard rumors of a merger between my company and one outside our industry. I'm not involved in the discussions, but it got me wondering about when a merger might make sense and when it doesn't.
ANSWER: Ever heard of a Labradoodle? It's part of the latest trend in dog breeding, designer dogs. National Geographic TV reports that people are lining up for this Labrador and Poodle mix because it's a low-allergy and lightly shedding. Other popular mixes include Yorkipoos and Schnoodles. I couldn't make this stuff up, honest.
It's no different with corporate mergers. The question we all have to ask ourselves, does this particular pairing make sense? And not just for the folks in the corner offices who are calling the shots. Every employee needs to decide if this new combination has what it takes or if it's time to start working on that resume. I've included some questions to ask below. For more, check out Patrick Gaughan's book "Mergers" (Wiley, 2005).
Does your company understand the new industry? Remember when there were lots of "conglomerates" out there? Companies that literally made everything from soup to nuts to turbines. The trend these days is to stay within your industry, an arena that your organization understands.
Do you do your homework? You shouldn't race into a marriage, a lesson I learned the hard way, and it's no different in mergers. It's very important that the company spend time to do all appropriate due diligence (the fancy corporate speak for doing your homework). There have been too many examples of purchasers who discovered ancient factories, hidden debts and declining customers after a sale had already gone through.
Do you avoid making the same mistake that other have made? Every city seems to have one restaurant location that's like a revolving door -- it's constantly changing owners. Be wary of thinking you can fix other people's messes. I'm not saying that miracles aren't possible, it's just important to learn from history before a merger is put in motion.
Do you realize that deal making is different than managing? The merger world is full of great deal makers who have little skill at actually making the new business work properly. Sure you can make a deal happen, but do you have the firepower to make it work over the long haul?
Can you admit failure? It is not only possible for a new acquisition to fail; there have been cases where the new company has actually damaged the company purchasing it. That's why it's important to keep an eye on the merger partner to be sure that it adds value. Just as lifeguards learn that sometimes you have to leave someone drowning to save your own life, some mergers have to be accepted as failures so everyone can move on.
Answer these questions successfully, and you won't be barking up the wrong tree; you'll have a partnership that will have bite over the long term.
We'd like to hear your thoughts about mergers. I'll give an autographed copy of "Working Wounded: Advice that adds insight to injury" (Warner, 2000) to the best submission. Send your entry, name & address via: http://workingwounded.com or via e-mail: bob@workingwounded.com. Entries must be received by Wednesday, March 15.
Here are the results from a recent workingwounded.com/ABCNews.com online ballot:
How would you describe your current salary?
- Companies should be able to discriminate against overweight people, 10.4 percent
- Being overweight should be one consideration in the hiring or promotion decision, 26.6 percent
- It is wrong to discriminate against overweight people, 63 percent
Our winning strategy for dealing with ROI comes from C.A. in Boston, Mass.:
"I was really intimidated by business plans, ROI, etc. Finally, I realized that the only way that I would get what I needed was to learn how to make my case for the resources I needed. Needless to say, it worked. I talked to colleagues, looked at other peoples calculations and learned how to be a stronger advocate for my position. This is not as hard as you may think."
Mistaken identity…What are the biggest problems with resumes according to recruiters:
- Spelling errors, typos and poor grammar
- Reads like a job description, not enough about accomplishments
- Missing or inaccurate dates
- Missing contact information
- Poor formatting
From: ResumeDoctor.com
Bob Rosner is a best-selling author, speaker and internationally syndicated columnist. His newest best-seller, "Gray Matters: The Workplace Survival Guide" (Wiley, 2004), is a business comic book that trades cynicism for solutions. Ask Bob a question: bob@workingwounded.com or http://graymattersbook.com. ABCNEWS.com publishes a new Working Wounded column every Friday.
This work is the opinion of the columnist and in no way reflects the opinion of ABC News.
Related Stories
ABC News Live