In term of HR challenges during an M&A, I think that employee retention in the new structure is one. Another one is standardization of HR policies between the two sides and last but not least is the capacity of employees to adapt to a new corporate culture (or we could also think about the buyer making a move in embracing some of the culture of the company it merges with).
I believe the greatest challenge is to align staff’s expectation with a view that any discrimination, including perceived discrimination, is kept to minimal as negative feelings may start small but may have a large impact as that spread from one to another.
The state legalization of marijuana in the United States has posed an issue for us. Our formal policy is no tolerance for a positive marijuana test. Usage has become commonplace and acceptable in our society. This can cause fear and concern as we onboard the new employees.
I think HR faces the most challenges. People are the #1 asset. If the people part and impacts are not smooth, everything else is impacted. Culture, retention, health benefits, insurance, 401k, etc. Each has its own nuances and expectations that need alignment. I would bucket change management in here as well as that is critical to the HR function’s success.
Adjusting to acquired company culture and values, adapting to new work environment and regulations, talent retention, lack of communication and maintaining employment benefit/compensation are among the few challenges related to HR during M&A.
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