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Managing Mergers & Acquisitions With Rhythm

By Tiffany Chepul

    Wed, Jul 8, 2015 @ 09:00 AM Strategy Execution, Accountable Leaders & Teams, Mergers & Acquisitions

    In the last year, so many of our clients have been navigating the challenging waters of mergers and Mergers and Acquisitions Rhythm Systems M&Aacquisitions. As part of your growth strategy, you may be considering an acquisition as a Winning Move, as well.

    It can be a complicated and scary proposition, however. There are so many variables to consider - and that’s before anyone even signs anything. Does it make sense for us from a business perspective? Are we culturally a good fit? Can we agree on valuations? Is the timing right for both parties? Do we share Core Values? Can we afford it?

    But after the Due Diligence dust has settled and the deal goes through, that’s when the really hard work begins. It’s not easy to absorb another business model, people, culture and processes into your own. We have noticed a few patterns from Rhythm companies who are handling mergers and acquisitions with grace and savvy.

    5 Patterns for Successfully Managing Mergers & Acquisitions:

    1. Keep Smart. Educate the acquired company’s culture on the Rhythm methodology. Get the book Rhythm for all of them, start a book club, get them signed up for the Rhythm Blog. A fundamental knowledge of the methodology and building a shared vocabulary is key. The new team needs to be able to speak your language around strategy and execution.
    2. Build the new teams. When a team gets a new member, it is essentially a new team.Tweet: When a team gets a new member, it is essentially a new team. @RhythmSystems http://bit.ly/1TgCxFo As people from the acquired company begin finding their places on their new team, whether they are on the exec team or a departmental group, slow down and get to know each other. Even if the rest of the team knows each other really well, take the time to bring the new person into the fold. Carve out time at your first few weekly meetings and planning sessions to share. Share Core Values stories, learn about each other’s families, share your Culture Book and gain an understanding of each person’s background. The new person shouldn’t feel new for long.
    3. Preserve the numbers. The company you just bought was bought for a reason. They already have a successful business. The valuations were based on real numbers from a healthy business. You need to protect your investment during the transition. Establish a small set of KPIs for the acquired company to focus on and status weekly. Perhaps Gross Profit, Client Retention, Revenue and Employee Retention are the few most important things to you from a company health perspective. Set Red-Yellow-Greens and ownership of the KPIs with the acquired company’s legacy team. Status weekly, discuss and make adjustments as needed. Those of you using the Rhythm tool can create a Custom KPI Dashboard.
    4. Model strong habits. Your team needs to be on their Rhythm game while the new team members are coming on board. Everyone needs to status with consistency, and Weekly Team Meetings & Daily Huddles need to happen without fail. The best way to teach new habits is to model them, and it takes about a quarter to establish a new habit.
    5. Help them get focused. It’s stressful to become part of a new team. And, in an acquisition environment, it’s easy to feel overwhelmed. Help each new team member determine his or her Top 3-5 Individual Priorities for the quarter. Help them understand what’s important and what’s okay to say no to. Help them establish Red-Yellow-Greens and Due Dates. They will appreciate the gift of focus and clarity. You will get the maximum return on payroll. It’s a win-win.  

    how to acquire a business

    Photo Credit: Flickr User Nguyen Hung Vu, CC license

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