The danger of losing key employees after a merger

When your company goes through a merger, holding on to key people is important. It’s also hard to do.

Mergers and acquisitions have increased drastically in recent years, but a 2017 survey revealed that less than half of the companies that had been through a merger were successful at keeping its employees. Why? Generally, there tends to be too much focus during the merger on processes and numbers and not enough on blending the two company cultures and the people involved. That ends up leading to fear and confusion — and the stress alone is enough to cause major players to look for other opportunities.

Losing key figures in an organization during a merger or acquisition can be problematic for several reasons. First, those individuals are walking away with talent and experience that you need if you want things to go smoothly and the newly formed company to grow quickly.

Second, seeing those key figures “abandon ship” can create a ripple effect that shrinks your employee base dramatically. Those lower down in the ranks may take the disappearance of key employees as a sign of trouble — and act on instinct to preserve themselves.

Finally, those employees who walk away could pose a legitimate threat to your company simply because they have so much knowledge and experience. It may not be entirely clear if they remain bound by non-compete agreements — and that can erupt into breach of contract litigation that your newly formed enterprise doesn’t need distracting it from its goals.

Experts suggest that the best way to minimize the loss of employees (and accompanying litigation), is to keep the focus on the human aspects of the merger. Recognize that now, more than ever, employees will need clarity and guidance about expectations, their security and company goals. Their ability to be heard when they communicate their needs can also play a major factor in employee retention following a merger.