How Positive Relationships Can Drive Success in M&A

This is a conversation with Nicole Markowski, Manager and Corporate Development at wifli. She started her career in consulting and IT with an engineering background and now has transitioned to managing M and A integrations. This interview is about the importance of relationships in M and A, something that doesn't get talked about very much. We covered Identifying key people to build relationships with Approach to developing relationships Importance of delegating tasks in building relationships Handling resistant groups how to address people problems Great conversation. This episode is sponsored by our Business lines Deal Room welcome to Deal Room, where managing M and A feels less like a rocket ship and more like a walk in the park. It's the M and A platform that does it all, but without the drama. Efficient pipeline management Check Swift due diligence Double Check Smooth integration Triple check say goodbye to those endless training marathons just to upload a file Deal Room is as user friendly as your favorite social media app. Join the club of M and A superheroes like Block, Emerson, Broadcom who've already sped up their M and A activities with Deal Room. Learn more by visiting dealroom.net, again, that's dealroom.net firm room the virtual data room platform where high security doesn't mean high complexity. Imagine a VDR that's as simple as your favorite app, but with the security of a bank vault. Say goodbye to ridiculous per page billing and those sneaky hidden fees. We're not fans either. Signing up is quicker than making a cup of coffee. Less than two minutes and you're in. Check out a free trial@firmroom.com Again, that's firmroom.com let's jump into the conversation with Nicole.

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Joining me today is Nicole Markowski, Manager Corporate Development at Whiffly Whiffly is a.

Top consulting and accounting firm that focuses on helping individuals and businesses streamline processes.

Improve performance, leverage the right technology, and.

Increase financial success and growth.

Today we're going to talk about how to manage relationships to drive success in.

M and A. Nicole, how are you doing today?

I'm doing great. How about yourself?

I'm great. You know, I gotta tell you, I went out and I looked for speakers on this topic from the biggest, baddest, the best. And none of them wanted to come on and talk about relationships in M and A. So I gotta applaud you for stepping up.

Absolutely. Relationships are super important to me, so I'm happy to cover the topic.

Hey, can we kick things off with a little bit about your background?

I graduated from Marquette University. I studied biomedical engineering with a minor in mechanical. So very different from where I ended up. Out of school, I went to Accenture. So I became a systems and technology analyst in their new graduate program. My first introduction into M and A. I was actually working on a project where the number two and number three pharmacy benefit managers had merged together. So during the integration, as you can imagine, there were a whole bunch of hot projects. They had decided to create one new system and bring all of their data into that system. I was project managing a lot of their hot projects to get the systems up and running. So I did that for about a year and a half and that was truly my my dousing into the M and A world. I got sick of traveling every Monday through Thursday, so I decided to move to whitfly in their CRM consulting space. I didn't spend a whole lot of time on this team. I actually was working with our internal IT team on the internal implementation of CRM at Whipley. So I started to develop a lot of deep relationships with people in the IT team. And that led to the leadership of our IT team taking notice of my project management skill set and offered me a role within their team to help set up and run the M and A process for it. At that time, M and A was becoming a very strategic initiative for whitfly. We had done a couple M and as in the past, but IT was really becoming part of the forefront of our strategy. I spent five years in that role with our IT team, setting up, running and redefining it's integration processes. So during that time, I got to build relationships with a lot of people across the firm, from the M and A partner at the time to our HR leads, our finance leads. So I learned a whole lot about how whitfully Works as M and A continued to grow and flourish within Whitley. The M and A partner at the time created the role that I currently hold. My role has morphed a little bit as our team has grown, which is awesome and current day our team has four people and it's led by Bob Cunningham, who is Whitley's corporate development partner. So the role that I currently hold right now I'm responsible for setting up and kind of running proactive prospecting of candidate firms that Whipley may be interested in with my colleagues overseeing due diligence from our corporate teams and the client facing teams and ensuring that corporate integration is complete. So when I say corporate integration, I mean they're on a Whiffly computer, they're getting paid by Whiply, they're in our benefits and then my peer takes it from there for the integration of our client facing. So our practice and growth side, that's a little bit about my history.

That's like the best intro I think I've had. It's terms of being very succinct. I. I'm still stuck at the bioengineering part. Yeah, I've just been fascinated. I always find that a really interesting background. I've noticed from leading practitioners, whether corporate or integr to have some form of engineering. You moved into the tech integration space, working externally in a consulting environment and internal. Now you're in this current role and it sounds like you've got a pretty blended responsibility between diligence and integration.

Absolutely, yeah. And as my role evolves, as I continue to look out into the future, eventually I want to start learning some of the fundamentals of how we value firms, our valuation model, all of kind of the negotiation that's forward looking for me. But it's really exciting. Every day is different and I'm really supported by the leader of M and A at Whitfleet. To take ownership and make things better.

At the firm you want to run.

The corp debt function, that would be the goal. Yes.

I love it. How important are relationships in M and A personally?

Relationships are everything. But what I found in M and A is it truly makes everything better when it's at the forefront. From a professional services firm. The way that we do acquisitions is a little bit different maybe from some other ways of doing it. Talent and clients are number one priority for us. So we want to retain that talent. We are acquiring these firms because we truly want their people and we also want their clients. So in order to make both of that work, we have to build relationships. We cannot allow these firms to run as subsidiaries because that doesn't provide us the value in the deal. We have to have those relationships built between our side and the incoming firm side. Because as you can imagine, there's a lot of tough issues that come up in M and A. And having hard conversations when we're talking about short term pain for longer term gains is made a lot easier when you have that trust initially built with the other side.

So there's going to be challenges in knowing that you got to have a good relationship to work through those challenges.

Absolutely. And another part that causes issues in M and A is uncertainty. So a lot of the anxiety inducing reactions from both our firm as well as the incoming firm comes from uncertainty. Uncertainty can be a little bit more tolerable when you've taken the time to build that positive relationship, to lay the foundation of trust, because then you're not making an assumption that the party is coming with ill intent. When you're making decisions, you already have that solid foundation of, hey, we are in this together, we are one team. Yes, this is going to be painful for the short term, but this decision is being made with the most positive intent in mind.

The trust part is like a huge element. You want that because if you're going to be driving changes as part of your investment thesis and that trickles down to your talent of the company you're acquiring and the customers.

Absolutely. Starting from the top. If you don't have the trust of the top leadership of that firm, how can you expect them to turn around, announce to their associates, and get their associates on board if they don't trust you? That to me is just almost impossible.

Can we break down the key people to have the relationships with? Because I'm already thinking about the lawyers.

And consultants from a corporate development perspective. For us, a top priority is having a relationship with the executive leadership of the firm that is coming into Whitley. These are typically the people that really have made the decision that they are ready to sell into Whitley. So that's a phrase you'll hear from me is we're looking for firms to sell into weekly, not sell out of their current business. We need them to have the positive intent. We need to build a relationship with them because they're the foundation of that message to their firm once it's announced to their associates. So that's really step one. It also makes it easier if we take the time to build relationships with those executive leaders, to set expectations, to have hard conversations of, hey, the first six months is going to be really tough for your People, but know that we are here to help you through this. And if you don't have that positive relationship with the executive leadership, they're not going to come to you with issues and then things can spiral out of control. That's one really important group to me. The second important group is the executive leadership within our firm. The way our corporate development function works, we have to work very closely with our executive leadership team because they have a view of the whole company, whereas we only have a slice of the strategic plan. We need to rely on them for changes in the strategic plan. We need to inform them of changes in the M and A market. And so us really being in tight connection with each other and always collaborating is huge. We also have to prepare our executive leadership when we acquire a firm because we're a firm that truly cares about the people that are coming into our organization and to show that our executive leadership team does engage with them. So if it's an on site firm, if they have a big on site presence, our executive leadership will be out there. They'll take the time to talk to the associates. They're the ones presenting during the announcement. It's our job to make sure that our executive leaders are appropriately prepared for those conversations. The leads of our integration teams and due diligence teams is a huge one for me specifically. I work with these people day in and day out. And if I haven't done my job at building relationships with the people in our firm, they're not going to trust me. When we have to make tough decisions or if we're making a decision that puts more work onto their plate because they don't understand the intent behind it. If I haven't taken the time to lay that trust foundation and maintain that positive relationship with them. Another big part of my job is to challenge people to think differently. That's a lot harder to do if you don't have a good relationship with someone. When I'm asking clarifying questions, when I'm challenging them on assumptions, it can be really hard if I haven't had the time to build that relationship with them. And as I've said before, tough conversations are always easier when you have a positive relationship with someone. A couple more groups though, the acquired people, this one can be a little bit harder depending on the size of the firm. But our team members like to take the time to get to know the people that we're acquiring, to sit down with them at lunch, to learn a little bit more about what they do, to be there physically if we can. On site supporting them through these integrations to see, oh hey, you're a human, just like I'm a human and you're here to help me. You're not forcing this awful decision of change on me. You're here to walk this alongside me. Another one is brokers. I truly see an amazing path forward if corp dev functions are able to build a positive relationship with the broker if they have an opportunity to. Because what we've found is brokers are able to manage their clients a little bit better. So manage the expectations of what this process is going to look like. Manage the expectations of the amount of time time that the people have to spend during due diligence and negotiation. And if you don't have that foundational relationship with the broker, it makes the process really difficult and actually impedes the process and likely will draw out timelines. So those are my main groups of people that are extremely important to keep relationships with.

And the lawyers.

Yeah, we do have internal and external counsel, so that's a little bit more out of my purview now. But eventually that will be something that's vitally important to maintain and build that relationship with our internal counsel as well as our external counsel because we do use both during our transactions.

Okay, so let me make sure I got this. Yes, the gold is the talent you're acquiring and the customers, but you're not accessing them directly. You really focus on this executive leadership team because they're essentially going to be the conduit to really relay the message to the talent and the customers. That's why you have a big prioritization there. From there you have your own executive leadership team making sure they're completely aligned on the strategic plans. And if there's any changes you're seeing in the market, you're getting on the sync down the same page. And then you mentioned the various diligence and integration leads that could be across the spectrum of functions that you got to ultimately have a strong working relationship to be able to go execute together as a team. That means having a rapport so that when you have the tough conversations, it's easier to do versus you have it with somebody you don't know as well may take a little different way or defensive. And then we talked about the acquired employees when you, if you get a chance to really face with people that directly coming on the team, the bankers, then others miscellaneous.

Yeah, and I've got a little bit of a cool story about the acquired firm employees. When I was in my IT role we had acquired. I want to, say, five to six firms in the Chicago area. So that kind of built out our presence in the Chicago market. So the first acquisition we ever did in Chicago, it was pretty bumpy. We went through a lot of technology hiccups, but we were able to overcome them on site. And about three years later, as we were bringing a bunch of offices together, the admin staff actually remembered me and ran to give me a hug during the office consolidation, just because I had taken the time to sit down with them, to walk them through even the simplest five mouse clicks to get where they need to go. People remember that. They remember you for the time that you took and the kindness that you show to them during times of really challenging integration steps.

Can we talk about these individually? What I want to understand is the how you foster and develop relationships. And if there's different approaches with these different groups.

That's an interesting point on the different groups. But I will say the first point I want to start out with is at Whitley, our culture and our cultural training are unique compared to other firms and companies that I've seen. What I mean by that is Whitley started this culture training based on the Arbinger training of Outward Mindset. Outward Mindset is basically turning your chair and understanding the impacts of your own actions on someone else. So if I'm completing this action, is that impacting my direct report? Is that impacting my peer? So having that awareness of the people around you and the actions that you're taking and the potential consequences of those actions. The second element of our culture that makes building relationships honestly very easy. Within whitfly is we have this practice called Meet to Learns. A Meet to Learn is used both internally and externally with clients. So we tend to use this language with our target firms as well. And a Meet to Learn is basically a conversation. You're coming into the conversation with the intention to learn from the other party. So the practice is encouraged by leadership. It's encouraged across all areas of the firm to really sit there. And from a client perspective, what this shows is that we're listening to the needs of our client. We don't show up to the meeting assuming that we know what they need. So the intent of a Meet to learn or meet to give, we use both. The intent of a Meet to learn is you're curious about what someone else is doing, you're curious about their challenges, you're curious about their role, you're curious about their world. When you learn more, when you see people taking the time out of their day, even 30 minutes to get to know you. That just is an easy way to develop a relationship is by listening. So that's the first point of the general of why it's so easy for me to build relationships at withly for our internal teams as well as the incoming firm executive leadership. For me, over communication, it's hard to keep everyone on the same page in the very chaotic world of M and A. So over communicating when I find something out. So let's say that I found out something from our HR team that I know is going to impact it and may impact finance. You can bet I'm going to include both of these teams, even if it's a may have an impact because I find that keeping people on the same page is truly vital to success. I do think that's a piece of helping build and maintain that relationship with both my team members as well as the incoming firm executive leadership. Listening to others, making sure that you're truly listening to others, not just pretending to listen to them. You have to truly listen to them and then use your emotional intelligence skills to be able to assess and respond to what they're saying. If I'm noticing that one of my team members maybe is having a really bad day, I have to use my emotional intelligence to figure out, is this the time to have this discussion or is this something maybe we should discuss on a day where they're not feeling super overwhelmed. So to me, that just shows respect for the individual and where they're at. And if it's not a super urgent topic, then we can talk about it at a different time. So that respect between people giving credit where credit is due, everyone that's involved in our M and A process knows that we have an open door. If you have an idea, if you're seeing something that isn't working well, bring it up. It would be super easy for me or my other team members to claim credit for that, but I don't think that's fair. If you're asking a good challenging question, if you're challenging an assumption, if you're thinking outside the box, that should be rewarded and that should be called out. And that's part of cultivating that positive culture within our M and A team and building that trust to build others up. A key piece for all of the group is seeing people as unique human beings. We're all very different. We have different interests, we approach problems in different ways, we think about things differently. And so taking the time to get to know someone, to understand the context of where they're coming from, to understand what are their hopes and dreams to listen to events? To me, being able to acknowledge someone as the unique human that they are and when able, adapting your style to the way that they best either learn or respond is an amazing way to be able to start that trust journey with someone. I just think that's vitally important for all areas of the stakeholders. One tactic that I truly love is asking clarifying questions. So if you ask me what my brand tagline is, is my name is Nicole Markowski and I have a million questions. I'm just a naturally curious person. So one way for me to truly build relationships with people is clarifying a question and or confirming understanding. It may seem a little weird, but building that trust really comes from seeking to understand and then confirming that you see what they said in the same way that they see it by restating what they had said in your own words. To me, that goes a really long way with building trust with anyone. Taking that time to show that you respect their opinion and that you're trying to understand where they're coming from. My final one is honesty and expectation setting. So this one is probably more at the executive leadership level of both our firm as well as the incoming firm and brokers and bankers. So knowing that there are boundaries of honesty in the workplace, we can't all be completely open, especially around confidential matters. It's great when you can be as honest as possible and then set expectations where appropriate. Because let's say I had an expectation of the broker to be managing their client, but the broker doesn't normally operate that way. If I haven't said that expectation out loud, where are they going to trust me if I'm expecting them to do something that I haven't outright said? So to me, honesty and expectation setting is almost more on the forefront, but also could be part of the maintaining relationships.

I did like where you started with the impact of your own actions to others. That gets forgotten. I feel like it's so relevant in M and A, it will go back to the empathy which comes up again. So that that was a key theme I really liked then also that meeting to learn. They're really having this compelling level of curiosity to want to learn genuinely over communicating. They alleviate the risk of under communicating by over communicating. And then the truly listen to the point when you're really getting inside their head, essentially empathizing with the person to get a sense of how they feel, why they feel that way. Having this cordial level of respect in the way you commerce your communications, the open communication, asking the Clarification questions and then also the honesty and expectation setting on what's to come. The key ones I picked up, I want to get an example of how do you turn this into a practical. Because you may have this institutionalized as part of your company culture, which I get sense of it is then when you're working with a counterparty and say going back to this executive leadership team, how do. Is there anything that we could practically do to set the tone, whether it's for the specific meeting or just the commerce of doing this transaction together, Even.

If you don't in your organization necessarily have the same cultural values that promote that relationship building that WHIPFLI does, I will take the example of the incoming firm leadership like you laid out. So as we get close to and or sign that loi, we basically flat out say, hey, we would like to ideally have an in person meeting with you for a day and a half if you can swing it. And during this meeting what we want to do is we want to get to know you, we want to get to know your firm and maybe expectations that you have of our firm. During this process, we lay out expectations of what we expect from them in the process. Not only following the process, but the face, for lack of a better word, of what the messaging that they have to give to their associates up front. If you can say we want to be with you in person, you are important enough to us to spend a day and a half of our work life to travel to you, to sit down and help educate you on the process, help lay out expectations, understand what you expect from your side. And then ideally, if you can have more informal dinner, lunch, something like that, to truly get to know them as people. That's a great way to set the stage of we care about you and we care about building this relationship. And I write all of this in an agenda. It is a written out agenda. This isn't just like a spoken we tell them that we want to do something like this. It's we are going to be expectation setting. We're going to be educating you on the process and we expect you to come with your expectations of us so that there aren't any surprises in the end.

That's a good example of expectation setting. Right there is to set expectations about setting expectations.

The expectation setting, yes, I like the.

Getting to know the people. Like if you break that down, I feel like there's very formal ways of hey, let's go grab coffee or lunch or sit in a conference room and you go informal, let's Grab a drink, let's dinner. I don't know what else you can do. Hopefully people are doing fitness activities. Let's go play golf or something. Or tennis.

A walk maybe?

Yeah, let's go for a walk. Is there a strategy with that in terms of how do you approach building that relationship? How quickly do you escalate it? I usually just ask people for alcohol. I feel if I can get them drunk, I can get everything I want out of them. But that might not be the best approach.

Yeah. So usually we ask them if they would be interested, especially in that first meeting. We ask, are you interested in going to dinner with us? So a little bit more of a formal approach in the beginning to let them know we're interested in spending time with you outside of the walls of this organization. We're more than happy to field questions about work during that time, but truly try to set the tone of we want to get to know you during this dinner and you as a human, not you as the individual at work. We tend to start out with more formal approaches of a dinner. And then maybe it goes a little bit more into informal. For instance, during our associate announcement, I may not be presenting, I may be present just so that I can mingle around at lunch, talk to some of the people, see what they're having heartburn about, take an interest in what they do at the company. How many years have they been there? How do they like the city that they live in if it's a new market for us? So more of those informal approaches of when we're doing structured things. We can also take an informal way of trying to get to know people by having enough people on site to spread out and have conversations with people. If you have one person there, you can't get to everyone. So it's important for us to have enough people out there to build relationships across that firm.

Wow.

There's like a whole strategy of how you're hiring people.

There absolutely is. In the IT world, I had it down to a science of how many people we needed to support a certain size and or type of firm. When we were bringing them in from an IT perspective, I was assessing how tech savvy are they. Are they able to join these meetings? So, for instance, we've definitely had transactions where you can tell their people just aren't tech savvy. They've been handheld in tech. They had someone sitting in their office that could walk over and physically do the fix for them. And unfortunately, that's not how whitfully is staffed. We're an international firm, we've got a centralized help desk area. And so I knew that if the technology knowledge of that incoming firm was low, we were going to need more support people because we're completely ripping apart their technology world. When we give them their new Whitfly computer, they've got to relearn where their data is. They have to learn a whole new practice management system to enter time and expenses. Their email is going to look different. They have to put their email signature back in. It's extremely overwhelming. On the flip side, if I notice that it was a more tech savvy firm, we might staff down but have virtual support available for them. It's all about assessing the characteristics of the unique firm that you're acquiring and adapting to the needs of that firm.

On the people assignment of relationship development or accountability. Can you give me an example? Like using even the IT integration, how would you plan that out? And saying, all right, we're going to integrate their systems and here's the people involved, here's who you should be making relationships like, what did that end up mapping out to in the example of an it?

So let's say we had a traditional CPA services type firm that we were acquiring that was low on the technology savviness scale and let's say they had about 35 people. The first thing that we had to do is we need to figure out how challenging is the actual process of integration going to be. So how many pieces of software do we have to bring over and install on their new computer? How much data are we migrating from their servers onto ours? Is there any super unique setups for the desk? So for instance, in some of the acquisitions we completely redid the entire desk. I'm talking mounting monitors, plugging in docking stations, making sure that the computers physically worked with everything at the desk. That requires a next level of on site hand support to be able to complete all those desks at the same time. Then I looked at more of the what types of questions are they likely to have if they're really heavy on, let's say CCH document and they're going to be coming into our case where we know that's going to be a level of change that we need to staff up for. We need to have maybe three people there instead of one person there. In a firm that's going from case where to caseware. It's all about understanding how much time are you going to have to spend on specific tasks during the actual IT integration weekend. And then what is the profile of the clientele. Basically. Do you need to staff up a couple people because you think that one person's likely going to be sitting at someone's computer for two hours hours, or can we staff down a little bit more? Because it's just going to be a quick question about. I need to click this button.

I appreciate the example. This is the very thing of why both love and hate M and A. Yep. It goes back to think like you can't just create a checklist and go get this done. There's so much variables that you have to tailor to on every single deal. Listening Nicole teach you a lot of good things about that. Could you give me an example? Okay, so let's say we planned that out at least we had this. This mapping of the people and. Or and who's doing what in terms of working with that leader and positioning them in terms of what the expectation is or approach for them to build relationship with people at that target company. Any key things there that you frame up to get that person at least knowing what they're supposed to do?

I don't know that we had a truly formal process for that, although I could see where a more formal kind of training or the lovely word expectation setting for the people going on site. What we ended up doing is as we had people on site, we were taking note of the people that the incoming firm was responding to if there was someone that was always raising their hand. Because usually we would sit in a conference room and we would let people know, hey, if you have an issue, if you have a question, come into the conference room and ask us the question. What myself and the leadership of it started to do was notice the people that were raising their hands to go help the individuals and then taking stock of how did that interaction go. So getting a summary of did they get the issue resolved? Was it a bad interaction? Were they yelling at you? All of that kind of stuff. So taking stock of the skillset of the individuals on our team and then honestly what it morphed into is the people that had the skill set that were great both technically and with people ended up coming on M. And as more naturally we just started to gravitate towards the people that were excelling in that environment versus the people who maybe weren't as comfortable talking to people, which again is totally fine. Not everyone is a people person, but we needed the people front and center when we were on site supporting the staff. Now what I could see being helpful is almost like a kickoff call. So the week before everyone goes on site A, hey, this is going to be a really stressful five days. We understand tensions are going to be very high. You are representing not only our firm, but you're representing it. So we need to keep positivity front of mind. We need to be accommodating to these people. We've got to be organized and we have to be responsive. Again, everything goes back to expectations. For me, having that initial conversation to set them up for success of what we're expecting of them from support to me, could go a really long way.

I think I have gotten the Nicole Markowski framework of relationships and M and.

A. I want to run it by.

You because I might have to touch it up a little bit. First and foremost, you're developing relationships with the key executives early because you want to develop them as champions for the messaging and things of that sort. But you don't jump right into it. You really spend the time to build that relationship and trust with them. Then you're essentially providing the messaging that you would inherently like them to replay to the broader company and broader team. And also, as well as important for you to just get to know them generally so that you understand what their working approach and culture is like. From there, this is where expectation setting really clicks in. That as you progress and you have your meetings, you're even setting expectations about setting expectations, driving it in. So it's super, super clear, but also welcoming the other side an opportunity to add to that initiative, to. To keep making things as clear as possible. And then the other leg would be the strategy piece. We put that at the end because I think it really evolves because now you're moving through the deal and you're identifying more and more people and you're learning them. And that's where you start mapping this out. And to get that coverage or the broader thinking about how relationships are going to need to be there to cover all these activities that need to get executed on ultimately, absolutely. You're going to have to break that down further than come back and teach it as a course at a. I like it.

I feel like we could work on that.

I got. I did my part. There you go. Who is the most important person to have relationships with in the acquired company?

It's so hard to just pick one. But honestly, I keep going back to the leadership of that firm that is coming into Whiply, that leadership team. Again, this is under the assumption that they were a great leader in their organization and they have the respect and attention of the people underneath them. This all kind of blows up if that's not the case. But to me, that is the leader of the organization and that is the person that we keep going back to. They are the one that has to positively message this. They are the one that potentially has to deliver some bad news about a short term decision and why it's going to be better for the long term. They are truly the head of change management for their people. Because as much as we want to be those people, and eventually we will be once we've had the time to develop the relationship out of the gate, we don't have the trust of those employees, but that leader should. For us to set that leader up for success, we have to build a relationship with them, we have to coach them and we have to make sure that they are appropriately prepared to deal with the situations that are going to come up in M and A. That is the most important factor in success of the integration. Because the instant that conversation starts to turn negative from that leader to their associates, what do you think the associates are going to think of it? If they trust and respect that leader and the leader is saying, yeah, they decided to make this decision, but I don't agree with it. Great, now we're all the way back to the beginning of the change management scale. We have zero adoption, no buy in. They don't even want to do it at that point. So it's truly important that leader keep a positive tone even through tough messaging.

Strike the center of influence. So I want to talk to you about dealing with assholes.

Now.

I want to point out that they could appear in any group. They could be on the executive team, they could be one of the attorneys, one of the bankers. They could be on your own team. What's your approach like? How do you handle that? Because they can really make it miserable for not only yourself but whole groups of people, 1,000%.

And I can tell you we have run into this situation probably on every single M and A. Like you said, it can show up in any group of people that you're working with. I take those on as a personal challenge. So my competitive sign comes out a little bit, assuming that I need to keep a long term relationship with them. So let me qualify that if we're talking about a broker banker that maybe we are interested in keeping a long term relationship with. I'm going to do my darndest to try to build that relationship with them and show them that I am a reliable person. I am listening to what they are saying, but they also have to respect and listen to what I'm saying on the other side, if this is going to be a long term, like if they're coming into Whitley and they're going to be one of my coworkers for the long haul, it may be a little bit of a different approach. So to me I'll start with the broker side. So on a call, let's say that we all end up joining early and we can have a little bit of small talk. Let's say that they're in California and I'm in Wisconsin. I can grasp them. If it's the middle of winter, don't even tell me about your weather because it's snowing in negative 40 here. So trying to bring a little bit of humor with small talk to get them to loosen up a little bit. I try to go back to that. See each individual as a unique human being. So I try to start understanding why are they having these actions. This is going to sound harsh. Do they feel stupid because they don't understand the new change? Are they just so stuck into their own ways and they're unwilling to compromise in certain areas? So what I would try to do in that situation is okay, we can do it your way even though it's going to cause some hardship on our side, but then we're going to need you to do it this way for this other item that may cause a little hardship on your side. So almost trying to take that more compromising route for the short term relationships can work. Now there are definitely going to be situations where I have not been able to build relationships with people. I'm not going to say that I've been able to build relationships with every single person that that has come. Either I've worked within a transaction or has come through a transaction. And if it's a shorter term relationship then it's business. Then we're right down to business and we're going to do what we need to get done and we're going to work together in a professional manner and that's where it's going to rest and that's fine.

I was thinking what might be helpful is actually if we defined assholes because I was thinking about that when you're describing potential approaches that there's actually a variety. I have a few of mine maybe to start off with with. I always feel like the people that completely lack self awareness. Yeah they get defensive about it like they can't be wrong about anything and it inverts into a blame on somebody else and things of that sort. I know there's going to be A lot more personalities around this that we can cover because there's again, it's a little broad. There's that one, there's the one acting on pure selfishness and then there's just the hard headed ones. They're resistant to any change. The worst is the ones that say they're going to get something done. They don't get something done. That's the worst. But I don't know, missing something. Those are my thinking when it comes to this profile.

I would agree with that. Each one may require its own different style of trying to break through and build a relationship. So I would say for the person that doesn't have self awareness, being able to have maybe an individual conversation one on one to me is a lot easier than if we're in a group setting. For instance, let's say that this individual was going off in a meeting and they weren't being professional, their speak was not professional. You could tell that they just weren't getting it. They weren't picking up on context clues. To me it's the afterword, the reaching out. Hey, I noticed in this meeting it seemed like you were either really upset or really frustrated with this issue. Is there something going on? Because to me it didn't seem like it was that big of a deal. Can we talk about it? Can we get to the bottom of why this is frustrating you so much? So again it comes back to that arbiter, the turn your chair, the meet to learn, the try to dig a little bit deeper, ask those questions. Maybe they're having a really bad day, maybe one of their top performers quit and so now they don't have the mental capacity to be able to separate out what's professional and not professional. So that to me is taking that step back and having that individual conversation is huge for that scenario as well as selfish. So that's another good one on this.

The lacking self awareness 1. I like the asking questions approach. Would you see yourself stepping beyond like even being assumptive of. Because sometimes you can read people, you can tell they're pissed off about something and you're just like you're pissed off. And you know, like why are you pissed off? Is that approach that you've used in long lines of questioning to get information and curiosity or a thousand percent.

So there was definitely a situation where this individual, I would say lacked that self awareness, lacked that bedside manner of communication with other people. And unfortunately it was an individual that was in that leadership role, the leadership role that I expect to be the champion of the deal going through integration. We were on a meeting with other leaders of that firm. So it wasn't just this individual, but this individual was at the top. And the tone was very different from any other meeting. It was very, oh, I pushed back on that. And they said no or I don't understand, understand why they're doing this or this seems really stupid. And it was in front of this group of people. And so I had to take a step back after that conversation because it upset me when I put my trust in you to be the champion of this M and A integration effort and then you turn around and basically blow it up in one conversation. That hurts me personally. I took a step back, I gave myself a little bit of time. I walked away, I took a little walk, I processed and I came back and I wrote an email and I said, hey. The tone of that conversation seemed really different from any other conversation. Is there something going on that I should know about? Is there something that has been left unaddressed? And the response came back and the individual basically said, oh no, there's just a lot going on in integration now. I'm like, hey, I'm here to help you. If there are things that you want to talk through, if there are things that maybe we need to find someone else to take that off of your plate, please let me know because I'm here to help support you. Making sure that you note that you saw there was a change in the tone to me is key to bring a little bit of that self awareness that other people saw something different in this individual. And then the care and concern of I care about you as a person. Is there something going on that I either need to know about or I can help with.

Got it. That helps. We're getting to empathy and the selfish people. I don't know if that same approach would work.

Maybe not. I still like the questions. I still like making clarifying statements. But to me with the selfish people is almost got to build up their ego. So even if it was a joint effort to solve a problem, giving the praise and the kudos to that individual to feed the ego to me is a way to build a relationship with that selfish person. Feed into that play off of what their natural state is because you're not going to change them at this point. It is up to themselves to become the individual that they want to be. So my whole way of doing it is approaching it and trying to use their natural tendencies to get that relationship built.

I like it feed into the. You got a good example of that.

I feel like I haven't. We do a pretty good job at looking at the culture of the firms as we're going through the prospecting process. So to be perfectly honest, I haven't run into that a whole lot, at least outwardly. I don't know that I've ever had to unless I did it without knowing it. I don't know that I've ever had to be in that type of situation. Because most of the leaders that we work with are most concerned about their people.

That's true.

I know a couple of people in the industry like this. I can try it on them. Then the other part of me doesn't want to even engage with them.

And that's totally fair. And at the end of the day, I have to remember, and this is something that I continually work on, I'm not going to have a relationship with everyone. Not everyone is going to like me, not everyone's going to like my style. And at some point then you just have to be resolved to. Okay, then we have a professional relationship and it is what it is.

Okay. The hard headed slash stubborn people.

Hard headed, stubborn. I try to take the nice approach first. So I try some of those other methods. I try asking the clarifying questions, digging in a little bit deeper, potentially even playing into maybe what they want. And if I'm not seeing changes, I basically have to make a decision of. Of is this worth my effort to continue to try to build this relationship or am I going to have to start playing hardball back? And if I have to start playing hardball back, relationship isn't going to develop. I know that. But at the end of the day I have a job to do and we have to get it done. To me, that's more of almost the lost cause area. You got to make a tough decision at some point as to whether it is worth your effort to continue to try to build this relationship or if you just got to go down the we have to work together. If you want to play hardball, I'm going to play hardball back.

I like expectation setting.

It kind of is what it is. You have to just know that there are those people out there. And luckily this is a short term relationship that we're dealing with more of this hard headedness. And so I don't necessarily have to care about the long term impact of not being able to build a relationship with them.

I think we just made a nice little framework on how to deal with assholes.

Yeah, I like it.

So let's try to summarize this into advice that you give a first time practitioner.

To me, the first piece of advice is when you get introduced, take the time to get to know the people you're working with. And I caveat that with if the environment is safe to do so. I can't think of an example where it would be, but I always like to caveat statements because I'm very risk averse. The best way in my opinion to get to know people for who they are is to do it in person. You can try over zoom and yes, you can build positive relationships over zoom, but there is just something different about being face to face with that individual and looking them in the eye while they're telling you about their life or while you're telling them about their life. Making that a priority at the beginning of the deal is going to make overcoming those rough patches way easier. So that's my first piece of advice. Second piece of advice is patience is essential in developing an M and A process. You are going to have people who are stuck inside the box. You're going to have the hard headed people, you're going to have the self involved people, you're going to have the resistors. But M and A truly is a continuous improvement journey. Every transaction is different from the last, even if it's only slightly different. That means that you really want to take the lessons that you're learning from each transaction to make your process better every single time, not just rest on your laurels there. And the third one is my favorite piece of advice. Realize that no deal is going to be a perfect transaction, whether it be integration, due diligence, negotiation. There's this quote that is stuck with me and I can't for the life of me remember where it came from. But it basically said if you're looking for perfection, M and A is not for you. I really like that quote and I wish that I knew where it came from.

Awesome. Before he knows, reach out face to face. Patience. No such thing as perfection.

Yep.

I gotta ask Nicole, what's the craziest thing you've seen in M and A?

I cannot wait to answer this question because I have heard you ask it on so many podcasts and I had my answer ready, so. So I gotta provide a little context. Here at wifli, we have an IT policy that when you're printing you should be using a multifunction device. It's cheaper, it's easier to maintain, and it's more standard than an individual desktop printer. And that's assuming you're in the office this was actually, I want to say, maybe my fifth transaction that I had been in in the IT space. We were on site, we had completed our work over the weekend. Everything was going great. We were into support mode on that Monday and we had an individual whole dorm into our conference room. And of course, what had we removed the printer from his desk. So we, during the transactions, we would take away the individual printers and we would set up the big multifunction devices for everyone to be able to securely print. Again, less costly for the firm. Way easier to maintain and way easier to support for the individuals. Well, apparently printers are like family to people, especially in the CPA world. So this individual was. Was so upset that he stormed out of the room and actually punched a wall on his way out.

You put a hole in the wall.

I think there was a little hole in the drywall. It was around the corner from where we were and I was actually over by someone else and I had just heard the commotion. We learned a bunch of lessons from that situation, though, that we needed to regularly communicate over communication, that we needed to prepare them for the standards of WHITFLI as early as we possibly could in the process, allow them to ask question questions and allow them to potentially raise an issue or a problem with the way that we were doing things to potentially receive approval for an outside standard. So I think that is the craziest thing that I have seen in the transaction so far.

That is insane. It's cool that actually saw it firsthand. It probably was a good learning experience to like, see a real emotional response.

Yep.

And take that back to integration planning in the early stages.

Absolutely. Yes. And again, we learned a lesson and we adjusted going forward so that hopefully we could avoid that in the future.

Awesome. Nicole, this has been great. I appreciate you taking the time from doing deals to have this conversation helping me become a better M and A scientist.

Absolutely. I truly appreciate you having me on the podcast. This has been a lot of fun. So happy to help whenever.

Hey, those of you still with us, thank you for sticking through. Until next time, here's to the deal.

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