Firm mergers dominate the headlines of every legal publications. There are few, if any, top-tiers left in Australia which have not merged with international or local firms to more effectively claim market share. However, with an average 30% of employees deemed redundant after a merger or acquisition, how should employees respond? Insights explores the factors employees should consider, and the best steps to safeguard their careers.
Assess the Impact
Before you rush off to prepare your resume and reach out to recruiters, take a minute to take stock of the situation.
“Some mergers have little or no practical impact on employees – for example, when one company buys another primarily as a financial investment and keeps the target’s operations fairly independent,” Mitchell Lee Marks told the Harvard Business Review. “You’ll need to figure out where you stand before you can plan where to go.”
Conducting a SWOT analysis of what you have to offer the new organisation can be helpful.
“What makes you a ‘keeper’?” asked Mitchell. “What in your personal makeup and career background could be an asset in your new situation?” Conversely, do you not deal well with uncertainty or new colleagues? Are there potential opportunities – potential areas of the new firm in which you might fit in? Do they interest you? Finally, consider where the firm is at its least lean – where there might be staff to cut. If this is your area of law, you may want to ready your resume.
Join a Transition Team
“Most merging companies set up a ‘transition structure’ – a temporary but formal organisation made up of dozens of committees, task forces, and teams charged with realising the expected merger synergies,” said Mitchell. Joining one of these transition teams will give you an insight into how the new firm is likely to operate. If this is a firm you feel you can be a part of, being part of a transition team can give you a chance to showcase your worth to the new firm.
If there is an opportunity to speak more informally with your colleagues, perhaps during after work events, it may be worth seizing it. This may provide a more unvarnished view of the merger and its potential impact on staffing, workload or culture.
Apply for an External Role
It may be apparent that the new firm is no longer the right fit for you. This may be due to staff cuts affecting your area of practice, a shift in culture or inflexibility around working conditions; whatever the case, if you feel it’s time to move on, do so swiftly.
“Sadly, one of the main attractions of a merger for your average partner is the opportunity to get rid of some assistants,” WaitroseLaw told LegalCheek. “Unfortunately, there’s often very little you can do to challenge that decision effectively.”
Negotiate for a solid redundancy package on your way out. Budget will have been allocated, so the sooner you flag your interest, the better.
Leave Before You’re Asked
Just prior to the Henry Davis York (HDY) merger with Norton Rose Fulbright, HDY announced it would cull more than 7 per cent of its Sydney personnel, including six fee-earning lawyers. Many viewed this as a signal of further consolidation to come once a merger occurred.
Rather than wait for redundancy, seizing the initiative and maintaining momentum with your career is essential.
“Consider Rob Michalak, who led the public relations function at ice cream maker Ben & Jerry’s prior to its acquisition by Unilever,” said Mitchell. “Shortly after his company went up for sale, Michalak conducted his personal SWOT analysis and concluded (rightly) that new owners would want to steer the PR function and reduce its ranks. Accordingly, he left Ben & Jerry’s to learn more about how different companies link social responsibility to their business goals.”
One thing is clear: M&As are here to stay.
“I think there’s going to be quite a bit of fluidity in the mid-tier market and you will see some mergers occurring and you’re seeing that now,” Spark Helmore chairman Mark Hickey told Lawyers Weekly. “I think it is a strategic need for a national firm to grow revenue and profit but more importantly to grow through acquisition of like-minded partners.”