usair_begins_with_u
Veteran
- May 9, 2004
- 623
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In case he missed it in todays Wall Street Journal....
[snip]
Human Due Diligence
By DAVID HARDING and TED ROUSE
October 2, 2007; Page A16
Someone may soon buy the European bank giant ABN AMRO Holdings. The Royal Bank of Scotland and Barclays are each offering more than $80 billion and investors are waiting to see if a sale goes through.
But if the past is a guide, markets will focus on assets, portfolios and business synergies and overlook a key to whether the deal is successful: people.
People issues are often the root of failed deals, our research shows. That is because they are frequently an afterthought in the frenzy of a deal. Dealmakers gather reams of financial, commercial and operational data. But they often pay scant attention to what we call human due diligence -- understanding the culture of an organization, the roles that individuals play, and the capabilities and attitudes of its people.
When the human factor takes a back seat, post-merger problems quickly pile up: Managers are forced to postpone decisions or are blocked from making them. Differing management styles frequently lead to infighting. Talent exits. Integration stalls. Investors grow impatient.
In some of the most successful deals, there's a flip side. Rigorous human due diligence helps acquirers get off to a running start. Having done their homework, the new bosses can uncover capability gaps, as well as defuse points of friction and differences in decision making. Most important, when critical people decisions are made right away -- who stays, who goes, who runs the combined business -- an acquired business is much more likely to succeed.
This benefit is borne out in research we conducted among managers involved in 40 recent merger and acquisition (M&A) deals. In 15 deals classified as "successful," nearly every acquirer identified key employees for retention during due diligence, or within 30 days after the announcement. This task was carried out in only one-third of the unsuccessful deals.
[end snip]
You can replace 'key people' with key 'labor groups' Basically Dougie, Lakefield et al failed in their human due dilligence.
[snip]
Human Due Diligence
By DAVID HARDING and TED ROUSE
October 2, 2007; Page A16
Someone may soon buy the European bank giant ABN AMRO Holdings. The Royal Bank of Scotland and Barclays are each offering more than $80 billion and investors are waiting to see if a sale goes through.
But if the past is a guide, markets will focus on assets, portfolios and business synergies and overlook a key to whether the deal is successful: people.
People issues are often the root of failed deals, our research shows. That is because they are frequently an afterthought in the frenzy of a deal. Dealmakers gather reams of financial, commercial and operational data. But they often pay scant attention to what we call human due diligence -- understanding the culture of an organization, the roles that individuals play, and the capabilities and attitudes of its people.
When the human factor takes a back seat, post-merger problems quickly pile up: Managers are forced to postpone decisions or are blocked from making them. Differing management styles frequently lead to infighting. Talent exits. Integration stalls. Investors grow impatient.
In some of the most successful deals, there's a flip side. Rigorous human due diligence helps acquirers get off to a running start. Having done their homework, the new bosses can uncover capability gaps, as well as defuse points of friction and differences in decision making. Most important, when critical people decisions are made right away -- who stays, who goes, who runs the combined business -- an acquired business is much more likely to succeed.
This benefit is borne out in research we conducted among managers involved in 40 recent merger and acquisition (M&A) deals. In 15 deals classified as "successful," nearly every acquirer identified key employees for retention during due diligence, or within 30 days after the announcement. This task was carried out in only one-third of the unsuccessful deals.
[end snip]
You can replace 'key people' with key 'labor groups' Basically Dougie, Lakefield et al failed in their human due dilligence.
