The commercial world rarely remains static, meaning that change is always just around the corner. Often, businesses need to adjust their shape or structure just to remain profitable.
A merger consists of two or more business entities consolidating into one new company. The motivation for this is typically financial, with greater resources resulting from two businesses joining together. However, it is important for corporations to consider factors outside of economics, such as employee morale, to ensure a successful merger. Outlined below are some of the key challenges that employees may face after a merger has been completed.
Power struggles
Change is inevitable after a merger, and this includes adjusting the role and responsibilities of management. Employees who have been used to running their own teams may be uncomfortable at having to now answer to a new layer of upper management. Sometimes, managers might be unable to accept new conditions, meaning that they have to move on. This can have a trickle-down effect on employees, who may become unsettled after watching someone who they had respected depart from the company.
Confusion over company ethos
Successful companies tend to build their own brands. Employees contribute to this by establishing routines and interacting with customers in a unique way. A merger often involves an influx of new staff, who likely have their own way of doing things in the business world. Such a change has the potential to create confusion, meaning that set patterns of behavior and branding can become confused. It is vital that parties involved in the merger process are able to compromise, communicate clearly and create a workplace culture that functions efficiently.
While a merger can be extremely challenging, it can also increase the profitability of your business. As you go through the process, it is important to keep your legal rights in mind.
