50% Of Business Mergers Fail By Ignoring Human Element

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25th September 2008, 05:09pm - Views: 535

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25th September 2008

50% of business mergers fail by ignoring

human element

Half of all business mergers classified as unsuccessful in terms of “benefits realisation”* - 5 reasons for failure.

Around half of all business mergers are classified as unsuccessful in terms of “benefits realisation” and yet proposed

large-scale mergers in the retail banking sector show that businesses are not losing their appetite for this risky process.

Brisbane-based change management experts Astor Levin explain in a recent whitepaper** the five reasons why mergers

fail and six things organisations must do to stop this happening. Failure is due to:

1. lack of change readiness

2. insufficient or ineffective planning

3. failures in effective management of the change program

4. ineffective communication

5. insufficient follow through and a failure to achieve sustainable organisational learning

According to Astor Levin’s whitepaper, six points are crucial to the success of a merger:

1. good communication

2. linking reward/recognition with desired values/new behaviour

3. acknowledging and responding with genuine empathy to employee resistance

4. being aware of change burnout

5. helping employees deal with continual change

6. finding ways for employees to get involved in the change

Astor Levin director Sonya Melbourne adds “Really the number one culprit for the failure of change management

programs - quite apart from the five reasons we cite in the white paper - is not understanding and dealing with the

human element of the process. What looks good on paper can very quickly become undone if this is not taken into



*Hunt, J. W., Lees, S., Grubmbar, J. and Vivian, P. D. (1987). Acquisitions: The Human

Factor, London: London Business School and Egon Zehnder International;KPMG (1997);`Consulting the map: mergers

and acquisitions in Europe’. (Research report.) London: KPMG.; and others

**Top Tips for a Successful Change Management Program

About Astor Levin

Astor Levin Pty Ltd is a Brisbane based human resource and management consultancy firm that provides services to a

range of private and public sector clients throughout Australia.  The team consists of highly qualified consultants with a

mixture of human resource management, business analysis and organisational psychology backgrounds with global

experience.  Their client base ranges from small business to ASX200 companies. 

For more information please contact David Bateson on 07 3901 1055 / 0402 332287.

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