Don’t seek a merger for the wrong reasons. If the driving force behind a merger is only the hope of saving money or saving one organization from extinction, there is a greater likelihood that the merger won’t succeed. Nor should you attempt a merger because it “it worked there, so it can work here.”
Look for these traits. A grass-roots, volunteer-led effort to effect a merger may have a better chance of success. Also, successful mergers often have “a high-profile corporate champion.”
Don’t expect immediate action. It’s not unusual for merger talk to brew for a decade or more before anyone acts. It takes the right combination of leadership, politics and circumstances to bring about a successful merger.
Examine different structures. Combining organizations is just one of many options. Leaders can select from multiple types of federations, partnerships, marketing agreements and menu-of-services agreements that might suit their communities better than a merger.
Consider co-locating or jointly working on projects before merging. Doing so is not a prerequisite of a merger, nor does it guarantee a merger’s success, but these types of arrangements allow employees to get to know one another better and may even help you determine the right way or right time to proceed.
Be brutally honest about the expected outcome and timeline. Determine whether the organizations are considering a “true merger of equals,” regardless of the size of staff or budgets, or an arrangement more akin to an acquisition.
Understand the non-negotiable issues. The location of the future office and the name of the new organization can be highly sensitive issues.
You can’t please everyone. Nor should you try. Instead, consistently focus on what’s best for your community, not companies or individuals.
Budget adequate time for due diligence. Mergers can take more time than you expect. Make sure all facts about the finances of both entities are fully understood.
Expect the unexpected. Unanticipated issues involving money, politics, people or image will arise. Boards should be prepared to be nimble and flexible during the merger process.
Don’t underestimate the costs associated with mergers. In time, a merger may save money by eliminating redundancies, but don’t forget about the cost of staff time, legal fees, accounting fees, rebranding costs, dual leases and any new training/team-building for the newly combined staff.
Listen—a lot. Then listen some more. The “big issues” may look different from each side of the table.
Be wary of how your merger will affect other local business organizations. If you consolidate leadership organizations, you may make other organizations nervous. Invite them to be part of the process. Even if they refuse your offer, doing so will help them see you’re not a threat.
Be deliberate about melding cultures. Allow cultures to come together rather than forcing them to come together. This takes patience, the inclination to let employees express concerns, and willingness of the CEO to defend both cultures’ traditions.
Honor the past while looking ahead. A merger has to be about finding commonality and keeping the best elements of predecessor organizations. Programs and initiatives that aren’t working or no longer fit the goals of the new organization should be considered for the chopping block, but don’t forget the intangibles as each is assessed.
Align benchmarks with new goals. Traditional methods of tracking membership retention or ED investment dollars might not tell you whether you are succeeding.
Budget for member surveys following a merger. A survey lets you know whether you are on track, allows you to make necessary modifications to your work plan, enables you to promote your interest in what members think and provides substance to build marketing campaigns.