Kenexa (NASDAQ:KNXA), a global provider of business solutions for human resources, is underscoring the importance of a structured human resources approach to drive the success of mergers & acquisitions (M&As).
In a recent study, Dave Millner, Consulting Director of Kenexa EMEA and Director of Kenexa HR Institute, outlined that synergies projected for M&As are not achieved in 70 per cent of the cases and productivity could decline by as much as 50 per cent in the first six months without a streamlined HR strategy to support the new entity.
The study calls for avoiding unnecessary complexities and saving the business redesign for a later stage. "It is crucial to create understandable organisational structures and to build on the combined strengths of the organizations. There are '7 Habits for HR' that are critical to driving M&A: integrity, courage, vision, value for money, empathy, professionalism and execution," said Millner.
Millner continued, "Several HR functions must become more strategically and commercially responsive. M&As need core process to be followed as well as highly competent HR functions that understand the strategic, financial and operational drivers. If the HR function is skilled across all these disciplines, M&As should not be an issue."
The results indicate that key HR performance imperatives for M&As include creating a dedicated HR infrastructure for M&A; gaining an early insight into the deal objectives; assessing and identifying strategy HR/people-based risks; and identifying financial, compliance, cultural and talent risks.
"Any proposed M&A must also plan responses for the identified risks, build a communication plan, monitor and respond to the integration risks and assess the performance of HR during the pre- and post-integration phases," said Millner.
Kenexa has rich experience in M&A, having helped a range of clients across Europe, Middle East and North Africa with activities including assessment of people capability, providing re-structuring advice and design, re-designing of talent processes and re-shaping HR functions.
"The regional and global trend is that M&As are starting to move again and HR has a critical role to play in ensuring that maximum value is attained from any such transaction," Millner said.
