Mergers and Acquisitions (M&A) are a part of Corporate life and bring many exciting challenges and opportunities for all impacted employees and stakeholders. They also very often elevate global mobility (GM) professionals to a place in the sun.
So what is it that propels global mobility professionals into the spotlight during mergers and acquisitions? In this paper, we examine why global mobility is so important to the success of mergers and acquisitions, as well as key considerations for global mobility teams during this transition.
Mergers and acquisitions – a change and an opportunity
As part of a Merger or a major acquisition, GM professionals need to be aware of and influence the following likely changes:
New Company Business Plan, impacting:
Divisional or unit plans
New Company HR Workforce Plan, impacting:
Talent acquisition, retention, and promotion
Leadership and employee development
HR information services
New Company Finance Plan, impacting:
Corporate tax planning
There is also the very human aspect of global mobility — working with individual members of staff who are stationed away from their home country, very often in a fixed-term role, and who are faced with a number of possible scenarios depending on the circumstances of the M&A. GM professionals will need to provide support and guidance for their assignees during this process.
When a company is acquired, the assignee needs to understand:
The terms of the acquisition,
Whether their current role will exist in the new company,
If there will be a selection process, and
In what process(es) they will be included.
Additionally, the assignee needs to ensure their network of key stakeholders is up to date, creating the necessary connections within the acquiring organization. This network will require continuous revision as members of the legacy network exit.
If the assignee belongs to the acquiring company, there is still a requirement to follow these same steps listed above. However, attrition rates in acquired companies tend to be much higher, particularly if the acquiring company is buying intellectual property or products and does not wish to retain the majority of staff from the acquired company. Mergers are built on growing market share and driving economies of scale, which inevitably means streamlining management, locations, and staff. Redundancies are an inevitable by-product of this process.
Once the selection process is underway, a new set of issues arise that require clarification. For example, if the employee is successful in getting a role in the host country and is now employed as a local employee, are there any transition arrangements in place? Or if the employee is unsuccessful in finding a new role, who makes the employee redundant? Which country’s redundancy rules apply (e.g. home or host) and which company bears the redundancy costs? Will there be compensation for moving the employee and their family back to the home country?
Given these questions, GM professionals have the potential to create a playbook to identify each stage of the selection process and to guide their assignees and the HR Business Partners supporting the divisions/units. Highly-talented senior employees are often personally involved, so the GM professional immediately has a raised profile with more senior HR staff and with the senior employees themselves. Success at such an early stage in the process wins admiration and trust; it demonstrates that the GM professional is proactive and sensitive to issues which are important to the future strategy of the company.
Peter is a Global Mobility Transformation Consultant with over 30 years of mobility experience. He regularly provides insight on Global Mobility Management and Development, Intercultural Development, Workforce Planning, Executive Search and International Payroll.