Uncertainty 1: Will I still have a job?
One of the first concerns that employees may have on the news of a merger or acquisition with another firm is whether they still have a job or not.
Many M&As are undertaken with the goal of cost savings – some deduplication of backend roles to streamline the firms. Often times this comes down to a reduction in head-count. If the whole rationale of the merger is being framed as cost savings, and you are one of the likely candidates for elimination, then it is natural to expect employees to have big concerns regarding the future of their job.
Uncertainty 2: Will my compensation change?
Another concern may relate to changes in compensation – how will the pay levels and bands be merged with another company. There are many components to people’s compensation packages – pay, time off, bonuses, expectations regarding annual increases – and again it is natural to expect people to be concerned regarding their financial situation.
Changes to compensation are a key challenge with M&As – how do you bring together two firms, each with different compensation structures, and achieve a situation where everyone feels like they have been treated fairly? There is no easy solution – and the lack of clarity of how it will be handled can drive employee uncertainties.
Uncertainty 3: Will my work change?
Another source of employee uncertainty following the news that you have been acquired is how it will impact the work that you do. Different companies have their own sets of routines and styles of work so again it is difficult to assess from the outset what the changes will be. Changes could be gradual or small, with firms taking a long time to integrate the operations of the business. Changes could also be a lot more abrupt, overnight having to adapt to the new company’s routines. With such a range of possible outcomes, it is no surprise that employees can be uncertain regarding how the integration process will proceed.
Uncertainty 4: Who will my boss be?
Employees may also have concerns regarding changes to reporting relationships. Who will I now be working for? If you have a great relationship with your current boss, and suddenly there is a possibility that they will be replaced, this may drive anxiety about what the reporting relationship will now be.
Uncertainty 5: What about my colleagues?
A final source of concerns that employees can have relates to their colleges. An individual may be able to rationalize that their own job is relatively secure, but working at a company is more than just one’s own job. Employees are often strongly connected to their colleges, and a major change to the company – particularly one that may involve substantial employee turnover – can cause issues regarding what will happen to all the other employees at the business.