Blockbuster mergers like CVS and Aetna, Amazon and Whole Foods, and Cigna and Express Scripts have been in the news lately. M&A activity is up with the economy, and numerous companies across the Americas, EMEA, and Asia-Pacific are taking advantage of this growth to make deals. Reuters reported that global mergers and acquisitions totaled $1.2 trillion in value in Q1 2018 – the strongest start ever. Business leaders expect this trend will continue as companies look to obtain new technologies and expand their customer bases.
Mergers and acquisitions offer great opportunity and carry great risk. A recent Harvard Business Review study showed that 70-90 percent of mergers fail to achieve objectives. One of the reasons we see for that is a gap between the merger’s vision and execution – particularly in the sales organization, which should be driving growth. SalesGlobe has seen an increasing focus on sales organization integrations as leaders look to gain the expected M&A benefits.
In our integration work, we’ve found five common challenges sales organizations must address early to avoid losing great talent and failing to achieve the expected ROI:
To address these challenges, sales leaders should focus on managing the message, motivating the team, defining the measures of success, and executing the strategy.
Getting the leadership message out quickly, clearly, and consistently is critical. As soon as the merger is announced, the organization will start speculating about its fate. Top sales performers concerned about job security and career progression are the most likely to look for options elsewhere. Letting the acquired sales team continue “business as usual” – without a clear message about the plan ahead – is a recipe for turnover risk and loss of focus. We worked with one company that sold a technology component that worked well with systems sold by a younger, larger organization they had acquired. While the systems company found it counterintuitive to acquire and lead the component company, the CEO acknowledged the strengths of both cultures and clearly articulated how they would go to market together.
Assess the acquired company to validate the merger strategy and business plan and develop a detailed integration plan. Sales leadership can align teams only if the entire leadership team – including frontline management – works together to
Creating sustainable results to support an integration requires a well-planned execution strategy focused on four areas:
Communicate on a campaign calendar via multiple channels, as messages must be heard three times to be fully understood. Talk with both companies’ customers to understand their viewpoint about their needs and the risks of the merger. Explain how the new company can help them.
This article originally appeared on the Selling Power Blog.