The article HR’s Role in M&A built a case for HR’s inclusion in both due diligence and integration. But what do you do when you get the green light?

While an optimally performing HR function can help ensure the buying organization performs a complete due diligence assessment of all human capital matters, it doesn’t necessarily mean that YOUR staff is equipped to do the job. HR leaders must be humble and realistic when estimating staff capabilities and seek help when needed to fill knowledge and experience gaps.

In addition, depending on the frequency with which you engage in these transactions, outside resources in both niche areas, i.e., executive compensation and general disciples such as project management, may be warranted. Regardless of who performs the activities, the following are must-haves. 

1. Get Involved Early 

HR is often only invited to play after the ink is dry. However, the department needs to be involved in the due diligence process to be effective. Otherwise, you risk inheriting a set of circumstances that are, at worst, unwinnable or, at best, fraught with challenges. Three months after signature is not the time to discover that you have duplicative resources, dueling compensation models, and performance management criteria at odds. 

2. Prioritize Activities

To prove their value, some HR professionals will attempt to move quickly into the project’s tangible, more tactical elements, such as technology platform integration and benefits alignment. While critical, research suggests the organization will fare better by focusing first on key staff retention, employee communication, and top leader selection. While it may be harder to identify ROI indicators in these areas, the effort helps stabilize the organization and build trust among employees – prerequisites for resource-intensive projects noted above. 

3. Manage By Metrics

Developing a robust scorecard for all phases of the transaction will help you measure ROI and create a defendable win state for the department. HR should work with counterparts in finance and legal to identify realistic synergy targets and then develop a robust project plan to ensure stage gates are in place to hit the mark.  

4. Prepare for the Long Haul

To the outside world, the transaction can appear to have a distinct start and end. Behind the scenes, the organization is planning for a significant change initiative that just begins once the deal is signed. Team members should be prepared to Sheppard a full-scale change management approach to integration planning that sees the project to a conclusion. Too often, leaders skimp on post-deal resources, failing to extend support past the 100-day plan. This oversight can cause the unraveling of hard-fought gains.

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