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A merger could mean the loss of top talent at either company

On Behalf of | Apr 19, 2021 | Mergers & Acquisitions

Many people concerned about a merger and its impact on staffing will think first about redundancy. When two companies become one, there won’t be a need for two distinct human resources or accounting departments. Invariably, there will come a time when the company may have to let go of redundant staff.

Often, although a few people may be let go immediately with a merger, the company will wait to see how staffing changes during the merger process. It is actually very common for a significant number of people to leave companies during a major transition. In fact, your company might find that it loses some of the best talent during a merger.

Skilled employees don’t like unpredictable environments

Since most people already know that mergers come with downsizing, those capable of moving on to a more secure position may quickly do so. They could take a job offer at another company or slightly higher pay or even comparable pay but without the risk of getting laid off in the near future.

Even if an individual knows that their position or department is safe from downsizing, they may still choose to leave during the transition because of disruptions to daily workflow, increased demands on remaining staff or conflicts with incoming management that are common in mergers.

A review of your top talent before the merger can help reduce staff loss

Merger negotiations typically include transition planning and a review of staffing at each company. It may be smart to integrate negotiations with your top talent into the early stages of a merger.

Offering someone an incentive, such as a bonus or promotion, could be enough to get them to stay with the company. Even if you can’t entice everyone to stay on, you will have a better idea of what positions you will need to fill in the future.

Careful planning and skillful negotiations can go a long way toward protecting businesses during complex mergers.