The human factor in M&A

With technology and communication facilities and easy outreach to the general public, the level of business competitiveness in which we find ourselves globally is high, and as a consequence, in order to grow business, many companies have opted for mergers and acquisitions. However, it is often forgotten that the success of this type of transactions cannot be reduced to the analysis of numbers or merely financial considerations, since to a large extent the people involved will always be an essential factor in its management and success, both in the pre-closing and once it is concluded. Companies, which are nothing more than legal entities, do not merge, acquire, or sell by themselves, but there will always be a human factor behind them, people with different backgrounds, values, ideas, goals, and abilities.

Initially, in the background of a negotiation, it is impossible to say that it can be carried out in a one hundred percent objective way, since judgments and other elements loaded with subjectivity are part of the nature of human beings. However, these subjective criteria can be reduced to a large extent, creating an adequate negotiation environment, with external advisors who support with the guidance and the granting of objectivity, as well as with management teams that, in addition to being aligned, are willing to give up points to reach fair agreements, being faithful to their organizational cultures.

Additionally, when an M&A transaction is closed, the retention of talent and the strategy for human relations must be considered, not only at the management level but with all employees.

Lack of attention to talent retention can not only block a company’s growth but also reverse it, leading to the loss of important customers and suppliers. Considering this, it is essential to identify those critical roles, talent, and people with extensive know-how in the functioning of the company and after that, plan and implement the plans for their retention.

Finally, a solid foundation of relationships is an essential factor in a positive work environment and in building trust and confidence. The closing of an M&A transaction must also consider the alignment of policies and objectives, which is why the training of human capital, the integration of compatible teams and the appointment of leaders who support the growth of the company are crucial.


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