The Impact of People Experience on Deal Outcomes

I'm Kisam Patel and you're listening to M and A Science, where we talk with deal professionals and learn valuable lessons from their experience. This podcast focuses on stories, strategies and what actually happened during M and A deals. Before we get started today, I want to let you know I recently published a book called Agile M and A. We all know the M and A process is highly inefficient and and there's no real standard or evidence based approach to completing M and A deals. Agile M and A is a project management framework that emphasizes responding to changes, collaboration and continuous improvement. This means your team will improve identifying risks and opportunities during diligence as well as planning and executing integration so you can actually deliver on predicted value drivers. Get your copy of Agile M and A on Amazon or any major bookstore. Learn more@agilema.com hi, today I'm here with Karen Isley. Karen is an M and A specialist and the founder of Isley Associates International, an Australian based global consulting business providing M and A advisory services to organizations growing by merger, acquisition or other similar business transactions. She brings experience as an HR professional, business leader and management consultant to every engagement. Karen spent over 25 years working in house as well as for corporate and private equity clients. She recently completed research on the impact of people experience on deal outcomes. Today we're going to talk about how to be a good leader in M and A. How are you doing today Karen?

I'm doing great, Kisan. Thank you so much for having me here.

Thank you. Maybe we can just start off with a brief background on yourself.

I've been doing this for a long time. My First Steel experience was actually when the law firm that I worked for in Minneapolis St. Paul acquired another firm. After I finished business school at the U of M. I joined a US Multinational and worked for the guy in charge of the HR aspects of all of their mergers and acquisitions globally. Complete luck of the draw on that one over some time. I left corporate and joined Mercer in New York and moved to Australia in 95 where I joined a firm that was eventually acquired by Mercer. Ultimately I was part of the global M and A practice at Mercer until about 10 years ago when I set up my own business that I'm currently in now. So like I said, been doing this for a long time. Probably seems more planned in the retelling, but M and A is my thing.

So Karen, you've recently published a really interesting paper on leadership. You've done quite a bit of research because you got a lot of facts and figures in here. Can you summarize what you've learned from all this research you've done.

Of course I can. Kisan. It's probably not a big surprise to you that this is one of my favorite topics currently. In a nutshell, what we found is that people experience predicts deal outcome and leadership is one of two key predictors of people experience. In terms of the specifics, what we found is that when people and this means everyone involved, not just employees. When people have a positive experience in a deal, deal objectives are four and a half times more likely to be met. And These odds go to 23 times.

More likely when we cut the data.

To look at only deals where objectives were fully met or exceeded compared to deals, compared to deals that did not meet objectives at all or destroyed value. And look if there are any statistics geeks in the audience. The significance of both of Those results were 0.000 in layman's terms, 1 chance in 10,000 for each that those results happened by chance. After seeing these results, we ended up spending another eight months in the data really to see what we could find that would be useful for organizations to know so that they could take action to be able to improve the results of their deals by improving the experiences of the human beings that actually make the deals work. One of the things that we found is that leadership effectiveness is a strong predictor of people experience in deals. For example, people experience is three times more likely to be positive when leadership is not seen as a challenge in a deal and 5.6 times more likely to be positive when leadership is not seen as something that went terribly wrong in a deal.

Can you elaborate? Like what is a positive experience?

Great question Kisan. Always get that one. And I also always get the question when you say meet steel objectives, what do you mean? And probably the best way for me to answer both of those questions is to just give you a bit more background about how we did the research. We designed an online survey. We looked at 198 deals globally. More than 60% of these were cross border transactions. The responses that we received were from various perspectives, both buy side and sell side and the primary role of the survey respondents ranged from executives to employees to deal team leads as well as members, HR heads as well as HR teams, board members and also included some external advisors. We took the simple approach of asking people to think about a memorable deal for them and then answer some basic questions about it including whether or not the deal met its stated objectives. We measured this on a five point scale with at one end that the deal destroyed value and at the other end that the deal exceeded expectations. We went on to ask four open ended questions about challenges. What went well, what went wrong, what lessons did they learn? And received upwards of 25,000 words of comments. Amazing really. Out of 198 respondents, I think there was only one that didn't write something to us. But to get to the question that you asked that encouraged me to tell you about how we did our research. We finished up by asking about the experiences that people had. Specifically we asked overall, how would you characterize the experience of this deal or integration? And then using a six point scale from worst experience of career to best experience of career, we asked how was it for you? We did give them the opportunity to answer on unable to say. And then using the same scale, we asked them to speculate for the majority of others impacted I imagine it would have been and had them answer on the same scale. Of course they were also able to answer unable to say. Surprisingly, only a handful declined to answer that. So everyone felt like they could basically predict or speculate how the majority of people would have been feeling in the circumstance of the deal. So armed with responses to did the deal meet its stated objectives and what was the experience for the majority of people impacted by the deal? We were able to use regression analysis to determine what extent deal outcome can be predicted by people experience.

Can you define M and A leadership effectiveness and describe how it impacts a deal's outcome?

Look, he san, I would say that M and A leadership effectiveness is really about how successfully people can exercise their personal influence in order to coordinate the efforts of others in order to achieve whatever the deal objectives are that are set. And this is so critical for deal outcomes. Some recent research actually shows that business leaders collective mindset that is absolutely going to have an impact on deal outcomes. I don't know if you've read any of Roger Martin's work, but he did some research that was written up in HBR Harvard Business Review a couple of years back and he focuses on the one thing that you need to get right in a deal. This research was so cool. He actually looked at deal success, so looked at long term successive deals based on stated objectives, financials, et cetera. He also looked at what the early communications were, so what was announced to the public, what was announced to the market. And the thing that he discovered absolutely blows my mind. What he discovered is that the organizations who focus on what they're going to get from a deal are less likely to realize the benefits of that deal than Those who focus on what they're going to give or what they're going to bring to the deal. So this business leader's collective mindset actually has an impact on deal outcomes. How leaders show up, kind of what energy they bring, and how they actually role model what it is that is important for deal. Success will actually determine the success or failure of a deal.

So a big important driver is the mindset, whether they're focused on taking from the deal or actually contributing to the deal.

Yeah. And everything that that entails. And so think about it in real life, for example, if you meet someone and you've, you know, like you get that feeling that someone's going to take something from you, you don't trust them, you feel a little bit weird about things, whatever that's on the inside of them, that vibe comes out to you. Right. And you go, should I? Shouldn't I? Should I? There's some sixth sense that we have about whether we should trust someone or not or whether we should believe someone or not. And the same idea of this mindset that leaders bring to a deal comes out in their actions, the words that they choose and how people react to them. And of course, if we don't trust our leaders, if we don't want to work for them, the likelihood that we do what's required and the likelihood that we contribute in a way that helps deal objectives be met are less. It's the first time I've actually seen that research in the marketplace. There's not a lot actually leadership in M and A.

You're absolutely right. There isn't. It makes sense. I think some of the things you're describing are very fundamental. When you're in a meeting and you're meeting with somebody that's just constantly talking about what they want from you versus someone that's more focused on what your goals are and how they can help you. I think it's that similar mind frame, applying it to them in a context.

Yeah. Well, and that absolutely translates. People don't talk a lot about the emotion that comes with M and A, but it's any kind of merger or acquisition situation. It's a significant change for people. Right. None of us likes to be changed. We don't mind change so much, but we don't like to be changed. We don't like to have change forced on us. And when stakes are high, people have that kind of fear based fight, flight, survival kind of thing kick in and all of that emotion gets heightened in this situation. And so the capability of leaders to manage themselves. And to be aware of that emotion and aware of that situation in other people is really, really key to this.

Now, your research, you mentioned some specific attributes that M and A leaders need. Can we go over them and explain why?

Absolutely, yeah. So what came out of looking at all of the, all of the verbatim comments from people who participated in my research are really kind of three areas of MA leadership that are critical for effectiveness. One is deliberate, two is influential, and three is galvanizing. So to start with deliberate, when I say deliberate M and A leadership, this is early in the game where seasoned M and A leaders assess, they prioritize, they make investments to prepare their organization for what is about to happen to them. The significant change that's going to happen doesn't happen by magic. So whether it's your systems or your processes or your development of leaders or just getting people and the organization ready to do this requires this kind of deliberate focus which is the, which would be the first feature of M&A leaders. The second critical feature for M and A leader leaders or successful M and A leadership is really about influence. So influential M and A leaders, these are the ones that are fabulous role models. They're motivational to their teams. Even in the thick of a deal and kind of the crazy hurly burly that happens, they're still focused on building relationships. They're still focused on developing people. One of the. Well, I think I said to you earlier how critical it is to role models. You can't have your business leaders running around with their hair on fire, worrying about themselves and being afraid for their own situation or resisting change themselves. Because if they're doing that, they're not actually showing up in a way that's going to influence their teams to coordinate efforts and work towards the deal objectives that need to get met. So this influential M and A leadership is really that leadership from the inside out. It's from the heart. It's how do you get someone in a position where they can put they're confident and comfortable in their own situation so that they can actually show up from for their teams in a way that's productive. The third type of M and A leadership, effective M and A leadership, is really around galvanizing a team to move forward. So this is like the amazing sponsor, like being the best sponsor of a program that you could ever be. This is about getting everyone focused, making decisions, directing activity. It's actually about testing and adapting. So getting it a bit wrong and adjusting on the fly and doing that quite quickly. And also Being a great communicator. So what it takes really to lead from the front and take this whole organization forward are the features of a galvanizing M and A leader.

If you had to pick one attribute that an M and A leader absolutely needs above all others, what would it be?

If I had to pick one attribute that an M and A leader absolutely has to have, I would say, Kisan, that it's personal credibility. We all know that trust is earned and we earn that trust by doing what we say we're going to do when our walk matches our talk. The flip side is if we say one thing and do another, we don't get the trust, we don't have the credibility and people aren't going to follow us. So if I had to pick one, it would be that, interestingly, you're not actually going to find probably all three of those deliberate, influential and galvanizing traits in one M and A leader. That unicorn M and A leader that has all of those.

There are no perfect leaders out there.

Yeah, that's right. But the other part of it is, I mean, it's probably unrealistic to expect, but the other thing is it doesn't matter, right? So as long as you've got those capabilities in the right people at the right time. So for example, the deliberate M and A leadership, you kind of want that in your top decision makers and your CFO and business and your CEO CFO kinds of leaders because they're the ones who are actually going to need to make the decision and the investment in development. If you don't have those people understanding the pitfalls of a deal and the value of having an organization ready, they're the ones that need to be deliberate. Your influential MA leaders, absolutely critical that your frontline leaders have these capabilities. Our employees, our people actually trust their direct manager more than they trust the top team. So this motivational, relationship building, developing people kind of stuff is super critical for your direct line managers. Keith Dunbar's research also shows that this is a predictor of success is also those capabilities in the target company, right in the seller. So someone who can influence people to come over and stay the course. Absolutely critical. The influential in the acquired business and then you're galvanizing M and A leaders. These are the ones. This is your top team, this is your project sponsor, your chief executive that really needs to lead from the front, leading both the organization as well as being the face for clients and being in a position to make decisions and changes and choices. Again, this galvanizing capability also really relies on the success of the deal. Depends on in the end having someone in a position that can take it forward and bring the troops along.

What do you think is lacking in leadership training that's causing it to become a top issue for closing M and A deals?

That's such a good question. Do you know? I think it's actually more about development rather than training. Because when we do just do training work on things, not to put down training, but when we just train people, there's an awful lot of focus on what to do, which is fine, you need to know that, but not enough focus on how to be. And a lot of people don't even think about that. So I can make my checklist and you can make your project plan that has all of these Gantt charts and all of the stuff that says what we do next, next and next. But that's not going to be enough. The part that actually makes that work is how people show up. So you know that confidence and in personal situation, the commitment to relationships, the ability to do what you say you're going to do to be a great role model. Yeah, look, I just. That role modeling, I can't stress it enough. And oftentimes people aren't even aware of their own impact on others. So back to your training question. If we do the development and help people see the shadow that they cast as a leader on an organization and create that awareness, the organization is in a much better position if they've got leaders that actually understand their personal impact on the others around them and the link between that and deal outcomes.

How can somebody develop that? How do you train somebody in that area?

15 years of therapy. Kidding. Well, it doesn't hurt. Well, you raise a good question. Because it's something that doesn't happen overnight. Right. All of us in our lives go through a personal development trajectory. We somehow we get better at things, we get better at handling ourselves. We learn things, we make mistakes, we make changes. And how we interact with people and how we get along with people. One of the biggest challenges is how do you accelerate that so that you have a better chance of people leaders having their own experience be positive. That actually helps them make a more positive experience for others. The trick to that is starting early. So there is no possible way that in the 10 minutes between when a deal is announced and when a leader is meant to be behaving in a way that's expected to support the deal, there's no way in that 10 minutes that someone is going to go from not being able to do that, to being able to do that. I have funny conversations sometimes with clients in the lead up to working with them. And one of the biggest challenges for me is to help organizations get started on this earlier than they think they need to. And they say things to me like, well, we'll do some of that leadership work as soon as we know that we're more likely to do the deal. We're not sure we're going to do the deal yet, so we don't want to invest right now because we might not go ahead with the deal. My thought about that and my question back to them is always, well, even if you don't do the deal, how would you see this helping your organization? You see the penny drop? Because these leadership capabilities are critical for an organization, full stop. They just get heightened when so much change comes into play, such as in a merger or an acquisition.

What are some of the things leaders can do to improve employee experience during M and A?

One of the things that leaders can do to improve employee experience, and this may seem a weird one, but do not be afraid of the emotion that you're going to experience. No one talks about emotions at work, or very rarely do we talk about emotions at work. But the reality is this kind of change brings up a lot of stuff for a lot of people. If you want to improve the employee experience, you really have to lean into what's going on for them and not just ignore the stuff that's kind of uncomfortable. The other part that goes hand in glove with that is around communication. Ten, 15 years ago, the research showed that organizations weren't doing enough communication in deals. And that was one of the factors that was making deals fall over. Over the last 10 years, organizations have gotten a lot better at that. And so there's a lot more infrastructure around communication and a lot more information that is going not just one way, but two ways in an organization. And so with that as a good foundation, not being afraid of the emotion and being prepared to have the conversations about what's on your mind and being able to sit with that discomfort or concern is probably one of the most important things that leaders can do to improve employee experience.

Yeah, it sounds like this falls along the lines of empathy.

You're right. You're absolutely right. Walk in those shoes. Absolutely. And not judge people for what is a natural reaction to a circumstance. People hesitate to share what they're worried about because they are worried that something bad will happen if people know how they're feeling. And so creating that environment of openness and you know, kind of no retribution, no blame, no punishment for actually feeling concerned or being worried or saying frankly, what a leader might need to hear in order to help them be better.

I wrote a little bit about empathy in the context of M and A and actually had an interesting interview with one of my mentors, Mark Goldston, who's published a book on the topic. I'm curious if you had any thoughts about ways to encourage it and make these leaders more conscious about it?

Yeah, look, I think that, I mean, that certainly would be part of, you know, part of the. What's the right word? Curriculum topic. You know, when you're actually getting leaders ready and doing the leadership development, not training, but, you know, the development to help them show up as a better leader all the time, and then some training to say, well, how does that actually work in a deal situation? Because that's even more heightened. Absolutely. You need to build that in. So the empathy and also the personal awareness, because those two actually go hand in glove. You can't have empathy without personal awareness.

On the other side, what can employees do to help leadership understand where they may be lacking?

Give your leaders benefit of the doubt. Don't assume the worst. And the reason I say that is that the empathy that you were just talking about goes both ways. Like that same kind of fear and concern and worry and heightened emotion that employees are feeling is the same that their leaders are feeling. Right. Everybody, all of these human beings with all of these human emotions are trying to work through this together and figure out where to go. And so to the extent that it's possible to give each other the benefit of the doubt, it sets up a situation where then leaders can be open to feedback that they need to hear, which will help them improve and do a better job to bring employees along. Does that make sense?

They gotta let their guard down and be vulnerable.

Yeah. Yep. But it goes both ways. And so that, you know, kind of that chicken egg thing about you're not willing to let your guard down until you feel safe. And so the leader actually has to make an environment where their team feels safe to bring things up again. This is no different than just good leadership 101. Right. But it's just that it gets heightened in times of significant change, like a merger. So no one's going to bring up something big unless they feel safe to do so. So back to that influential leadership capability that creating an environment where it's okay for people to say what's on their minds is critical for leaders, that you need to create the environment where employees are prepared to speak up. And probably the employees need to raise a little courage when they can to be able to give the feedback where it's needed. But in the end, my view, it's up to the leaders to create the environment. And if that environment is healthy enough that people are prepared to raise issues, then they should feel free to give feedback, fearless and frank feedback in that circumstance.

Right now, you pointed a lot of your data and results back to how leadership capabilities can impact the success of a deal. How do you get the companies to actually, in their executive leadership to understand that?

Again, my first thought on that is there's nothing like a failed deal to capture the attention of senior leaders in boards. Back in the day, when I worked at Mercer, my job was to go into the market and convince organizations that this is something that would actually help their dealers, and this is something that would make their deal more successful in making these investments. The return would be, you know, would be positive and, you know, with the benefit of a global marketing team and et cetera. You know, we did the research and we went out there to convince the world that that was something important to do in my business. Now, without the size and scope, I always look for organizations that have done at least one and they know what's going on. So to help people understand, there's nothing like experience to teach. And getting burned once is probably the biggest way to capture attention. That sounds all quite negative, but yes, there's nothing like a failed deal to capture the attention of organizations in terms of making the right kinds of investments. When we looked even at the data in this recent research that I've done, I mean, leadership shows up as the top issue mentioned in all of the themes that had significant associations with employee experience. Leadership was the word most frequently used when we asked about lessons learned. There's not a heap of research out there, but the research that is out there that touches on leadership is something that, from where I sit, is important to get the word out because stakes are so high. I have a personal view that nobody should be injured at work. And when we think about workplace injury, you think about the wall caving in or the scaffolding falling down or someone getting injured in a manufacturing environment or something like that. To me, breaking a person's spirit at work is also an injury. You know, the stress on people that comes from the kind of change that happens with the deals. We should not be putting our people in a position of that emotional injury or that personal stress that comes with this. And to me, breaking someone's spirit is just as bad as dropping a wall on them. And as organizations get more across that and more recognizing of that, I think there will be more willingness to invest. Having said that, there's nothing like the bottom line that gets attention. So is four and a half times more likely to achieve your deal objectives enough of incentive?

I think I noticed a failed deal always isn't a wake up call because some of these companies have developed M and A machines that are purely financially driven off of just close the deal press release a bump in market cap and they just keep going. And eventually it gets to the point when all this stuff gets realized and it's a big mess because a lot of these companies in the end don't even get integrated properly. So I think there's some of those circumstances as well with some of the larger serial acquirers.

Some of the larger serial acquirers are actually getting better at this. Bain's done some research over the last 10 years. They've done a couple of studies that just looks at areas that we've improved in terms of doing this and looking at the long term impact of growing by M and A on organizations that actually do this. Well, there is research out there to say we are getting better at it. But when you still look at 50 to 70% of deals fail to achieve the stated objective, that stat, I hate to even cite it anymore because it's just been said for so many years, but the reality is the ones who are doing it in a very concentrated way and in a very deliberate way do have a machine that sits and it includes all of the things that we're talking about this morning which is why they can keep doing it.

When I'm looking at your research paper right now, I think we could talk more about the M and A fundamentals because it's interesting how you laid them out between clarity, execution and capability.

Yeah. So when I originally did the research and came up with the four and a half times more likely to be successful when people have a positive experience or odds going to 23 times when we just look at the ones that really did well or the ones that really did horribly, when I looked at that I got a little bit scared because I just thought this isn't out there, this isn't in other research. People haven't published something on this. I spent the next eight months digging deeper into that and looking at what is it that actually drives the people experience, that drives the deal outcome from all of that Camera three fundamentals that really are that need to be there One being clarity, the second, as you said, being capability, and the third being execution. In looking at those, what we found is like leadership, clarity is also a predictor of deal outcomes.

Yeah, I was going to say let's define clarity because I see you mentioned really the whole thing around asking the why and defining that clearly. I'd love to hear your interpretation.

Yeah, when I say clarity, I'm really talking about two things. So it's clarity of purpose for the business. Why are we here? What are we doing? How have we organized ourselves? How do we do things around here? What's our culture? What environment are we working in? How are we going about our business as usual? And then as a natural extension of that, what's the deal rationale? And accept expected outcomes for what we're about to do so that you're in a situation where these key messages to employees and anybody else that you need to influence and the impact on customers and partners and employees is known. So when we're talking about clarity, we've got all of our business as usual business purpose, outcome, strategy, how we work in the environment that we're in. And we also have in that context, the deal rationale and expected outcomes. Ideally, what we want is that deal rationale and expected outcomes to just flow naturally from why we're in business in the first place. So that the key messages to people internally as well as externally make sense and that we're really clear on the impact of this deal on our customers and on our partners and on our employees. So we've got three ma, clarity, capability, and execution. And the clarity is about business as usual as well as clarity about dealer rationale. When we talk about capability, we actually, again, talk about business as usual capability as well as deal capability. So our business as usual infrastructure, all of our enabling platforms, and as far as the deal goes, our infrastructure, our resources, skills, knowledge, experience to support that. And when we talk about execution, this is all of the getting it done. So clarity is all about context. Capability is all about getting ready, and execution is about getting it done. If you imagine a Venn diagram where clarity meets capability, this is where deliberate M and A leadership comes in. This part about what do we have? What do we need? How do we prioritize, how do we invest? How can we prepare for the deal?

Where does leadership's level of experience fall into this?

My first reaction to that is, look, the more experience, the better, the more deal experience, the better. Because every deal is different if a leader experiences a deal as an employee. So we talked earlier about empathy and this idea, like if you've had a deal done to you before, you lead through a deal, you're actually going to have a lot more empathy than if you've never experienced a deal. My first deal that happened to me was I was an employee and the law firm that I was in acquired another firm and I showed up on in our. The culture of that organization was that we work for clients all week and Saturday morning we pop in for half a day and do all of the administrative things that we didn't do during the week and chat with each other and walk around and have cups of coffee. And one of those Saturday mornings I showed up at work around 9, 30 or so, 10 o' clock to find a lot of boxes and a bunch of people that I didn't know walking around. Set my things down in my room and went across the open area and stood in the doorway of a stranger that I'd never met before and said, hi, I'm Karen. Hi, I'm Karen. Who are you? What are you doing here? What's going on? She, who now is one of my best friends in the world, explained to me that their firm had just been acquired by my firm. And we chatted. I didn't think much of it, we just talked and kind of went on about our day. I found out later, much later from my friend, that on that morning I was the first person that even spoke to her. So 10 o' clock on the morning of the day that you show up in a firm, your new home and some kid, I was a kid then some kid who out of curiosity crossed over and said, hello. Wow, how not to do a deal. Right?

Yeah, that's a really good point. I like in the beginning of your research how you point out some of the big challenges and problems with M and A. And the one that sticks out to me is underestimate the time complexity and cost of getting human beings to do what needs to be done.

That is so true.

It's almost thinking like the cliche with construction projects. It always ends up costing more and taking longer than you expect. But when you look at M and A, it really comes down to the people. And it's very similar. It takes a lot more time, complexity and cost of getting people to do things.

I was sitting with a client this week and the managing director of this organization is high level guy, moves fast, kind of short attention span, just get it done kind of guy. And then he's got this amazing person working with him that's trying to figure out how to get this done. And the mismatch between what it actually takes to do that thing that you can say in one sentence. It's a gulf. And again, back to what I was saying earlier about nothing like a deal gone wrong or a deal that you're struggling through to be a good teacher, because as soon as an organization goes through it, they realize that there's more to it than meets the eye. That's about leadership, but it's also. It's actually just, you know, broadly about project management and getting. Getting like. Like. Like we said, getting humans to do what it takes to get. Get something done. Get the outcome that you expect.

Yeah, you're right. You know, you also make a reference about timeliness of things, and that's another shortfall that often happens.

Yeah, yeah. I mean, and this stuff, I mean, all of the things that you're bringing up are true for any project or true for any major change. And I think the kind of the rule of thumb about this is when you're doing it in a deal scenario, because of the heightened emotions that happen, the degree of difficulty just goes up. And when the degree of difficulty goes up, the time stretches out or the stakes are higher. Right. Because say, one of the requirements of your deal is you need to meet certain objectives, and that actually requires certain people to be available and around and still with the firm. So you don't want turnover of the people that you really need. You also don't want to lose clients. And to the extent that people matter to keep your clients, that will absolutely drive whether or not that deal is successful. And if your people are triggered emotionally, you know, afraid, concerned, worried, distracted, dusting off their resumes. And that's what happens. Your best ones have a lot of options, and so they are your biggest at risk to go. The return that you expect on the investment that you're making in this deal goes into jeopardy as soon as that timeline starts creeping out.

You know what I like best about this paper is the end of it, where you have the summary of different tips and ideas on how to overcome a lot of these challenges.

Yeah, look, that's one of the parts that I love as well. And those top tips from the trenches, they literally have come from verbatim comments that people wrote in when they completed the research survey that I sent out.

So we don't have time to go through all of them because there's quite a few in here. But for any listeners that's gotten this far in this interview, there's definitely going to be a link in the show notes so that you can find it the paper yourself and take a glance at it. Make sure you find the checklist of the back with all these little tips in it. I find it really valuable to wrap things up. Karen, what would you say are the top tips that you would emphasize for anybody that wants to improve leadership in their next MA transaction?

Well, look, I'll defer to the wisdom of the crowd on that one and just share the tips that that Ki Sang Yoo just referred to. The ones related to leadership. First tip, invest early in M and A leadership development opportunities for senior staff. And this includes work on business cultural differences. Second tip, prepare leaders to sponsor complex change so they can skillfully lead their people through it. Third tip is ensure that leaders are experienced, visible and involved with the capability to effectively remove barriers to deal objectives. So those are the top three. And then there's kind of a side one that is probably worth worth saying. There's a couple of more practical rather than philosophical tips. One is from day one, have only one leader per division. Sounds obvious, but that not knowing who to follow is actually a real challenge if you had shared leadership. And the second one is move swiftly to shift out any executives that are not aligned with the future culture. So if you've got anybody who's not role modeling the behaviors that are expected for the future move them on sooner rather than later. If you can't change their behavior quickly, if you can't change their mindset quickly, move them on and go forward without them. It's a negative way to end if you can't.

No, I think it's a really good point because. And I talked to Keith in a recent interview on the same topic. People hesitate to let people go on those early indicators and they're too hopeful.

Yeah, look, absolutely. I mean, it's a thing that I have too. You overestimate your ability to change someone. You overestimate your own ability to manage a situation. And if you're getting feedback and if you're getting the vibe that it's not working, if you're getting it, chances are it's not. And people will be looking at you as a leader about what you're going to do about that. So when we go back to that role modeling thing, which is the most critical part about this leadership, right. When you go back to the role modeling as a leader in a business, in a merger, everyone's looking at you. And if everyone can see that something's not working and they see you not doing something about it, you need to think really hard about what that message sends, what messages that sends, and be.

Prepared to act to conclude your research. Karen, how would you position why any of this matters?

What we learned is that people experience makes or breaks a deal. We learned that leadership as well as clarity makes or breaks people experience. We learned that culture presents the greatest challenge and that capability and execution are just table stakes. And so if an organization doesn't have these MA fundamentals covered, it's an uphill battle to create value from their deals. And interestingly, when objectives are met in spite of ineffective practices, usually this is at the expense of people in some form. If an organization takes a shortcut, they're going to leave value on the table. And even when they meet the milestones that they set, if they don't attend to these things, they're probably missing opportunities to further improve on their deal outcomes.

Picking up on a lot of lost opportunities.

Absolutely. And it's funny, those things don't even get they don't get recorded when what gets measured gets done. When you're ticking off your things on your project sheet, the best the best M and A practitioners get that leading an M and A program isn't about ticking the boxes on the charts that come out of the program office. It's actually about working in between and understanding the opportunities and bringing people together to actually create value that you know, can go beyond what was what was expected.

Yes, I would definitely agree with that. Thanks Karen.

Thanks Kisan. Thanks for having me.

Thank you for taking the time to explore the world of MA with our podcast. Please subscribe for more content and conversations with industry leaders. If you like our podcasts, please support us by leaving a five star review and sharing it. I enjoy hearing feedback and connecting with our listeners. You can reach me by my email. It's Kisan K I S o n@dealroom.net M&A Science is sponsored by Dealroom, a project management solution for mergers and acquisitions. Additional educational content is available on Deal Room's blog@dealroom.net blog thank you again for listening to M and A Science. See you next time.