Do M & A Need To Resolve Human Resource Risks?

In mergers and acquisitions of domestic enterprises, people often focus on factors such as capital, debt, fixed assets, and so on.

However, in the process of mergers and acquisitions of large multinational companies, human resource factors often become one of the most critical factors for the success of mergers and acquisitions.

Joseph Claringer's research shows that only about 35% of mergers and acquisitions can achieve the desired goal, and most of the acquisitions fail to reach the target of human resources.

Joseph Claringer pointed out that finding the fatal flaw of target enterprises is the most important step to avoid the failure of mergers and acquisitions.

These defects include internal and external.

The internal fatal defects are as follows: (1) the loss or loss of core personnel; (2) the loss or loss of one or more key customers; and (3) the financial crisis that enterprises will soon face.

In this description, Joseph Claringer regards the loss of human capital in the process of merger and acquisition as the most fatal defect in the merger and acquisition enterprise, and the loss and loss of customers is also caused by the loss of talents in a sense.

"We should be clear that those assets recorded on the balance sheet have a tendency to depreciate, but human capital, although not recorded as assets, tends to add value or leave the business.

"Reconstructing the human resource management system to increase the human capital value of the M & A enterprises, rather than drain them, let us look at the practices of large multinational corporations.

Generally speaking, before purchasing, the purchaser should make an assessment of the human resources situation of Target Corp (that is, due diligence), which includes the company's organizational chart, salary and welfare system, and so on. The most important thing is to have a comprehensive analysis of senior and key personnel, including their ability, salary competitiveness, work experience, or even retirement benefits. According to the evaluation results, a human capital report of target enterprises is formed.

Generally speaking, before the merger, the buyer has talked with the senior staff of the Target Corp about the conditions of retention. And with this report, it is able to find out which incentive means are most effective for retaining senior staff through this report, so as to successfully retain these personnel.

The key task of M & A enterprises is to retain key personnel successfully. This is from the point of importance.

The integration of human resources by multinational corporations in mergers and acquisitions has already formed a set of fixed procedures.

The first step of this procedure is to re establish the human resource management system or repair the old system in accordance with the purchaser's wishes.

The specific way of adoption depends mainly on the difference between the buyer's willingness and the original company's business objectives.

But in general, human resources managers need to redefine the different positions of new companies, screen out and eliminate unnecessary jobs, or hire more efficient people in the same job; adjust the company's performance management, so that the company's remuneration and welfare can be more competitive in the outside market, and it has a more exemplary effect of rewarding, diligent and laziness within the company.

In this process, we should minimize the loss of employees in the original company and avoid the excessive impact and vibration on human capital.

However, if there is a strategic shift in business objectives (such as production of computers into mobile phones), large-scale layoffs are inevitable. At this time, we should strengthen communication as well as doing basic work such as job placement, post sorting and job matching.

Timely communication and resolution of M & a risk communication is an indispensable part of M & a human resources management.

A common practice is to form a communication plan (Com-municationPro-gram) before mergers and acquisitions. This plan includes some principles of information disclosure, media selection of information disclosure, and the number of one to one communication.

The importance of communication is self-evident.

Because mergers and acquisitions, employees will not know whether they can retain the job; if they can retain, then what changes will take place, such as where the job is, how the income is, whether it can adapt to the new organizational structure and so on.

It seems inevitable that people's anxiety is inevitable, so we need to communicate with employees to understand the motives, objectives and effects of mergers and acquisitions, understand their latest progress, and identify their target position in Future Ltd.

Comprehensive and timely communication can play a role in appeasing people and stabilizing enterprises.

After the completion of the work, the human resources integration of the merger and acquisition enterprises will be completed, and human resources management will continue to improve in the new system.

The scientific process is a process to win the key human resources management of multinational corporations in the process of mergers and acquisitions. In fact, there are many places worthy of our study and reference.

Before the merger, a consulting firm was introduced to conduct a comprehensive survey of the human resources situation of Target Corp (that is, due diligence).

From the experience of large multinational companies, the introduction of the third party professional human resources consulting firm at this stage can make the acquisition more rational and avoid the influence of the leadership of the company on human capital analysis.

This survey will not only retain key personnel, but also become an important determinant of the offer.

Because this survey is a human capital assessment for Target Corp, with such a survey, buyers can fully understand Target Corp's human resource status before takeover, thus greatly reducing the difficulty of human resource integration after the acquisition.

The integration manager position is set up at the integration stage to monitor and guide the whole process.

The advantage of this is that there is a final decision in the process of complicated integration, which is conducive to quick conclusion when the interests of all parties quarrel, and does not affect the normal operation of the company.

The experience of a large multinational company is that the specific affairs in the integration stage are carried out by itself, because the mature human resource management model that the multinational corporations have formed over the past decades may only be able to fully control the internal staff.

The four principles must be followed: the Beijing branch manager, Cheng Da, points out that the integration of human resources must be based on 4 principles: 1., the M & a company should communicate with and communicate with Target Corp staff as much as possible, so as to minimize the panic generated by the merger and acquisition.

It should be noted that such communication and communication should be carried out among key employees (i.e. core employees).

2. reintegration of human capital should match the purpose of mergers and acquisitions.

At the same time, try to hire former employees.

3. enterprises should adopt scientific procedures for selecting employees.

4., in the process of mergers and acquisitions, material incentives should be properly integrated with spiritual incentives.

Resettlement of employees who have been laid off actually appeased employees.