Fifty-seven percent of leaders anticipate an increase in deal activity in 2021 and 2022, according to a Mercer survey, yet a majority of deals fail to deliver value because they fail to focus on people. In fact, 47 percent of our survey respondents cite an inadequate focus on people issues throughout the deal process as the primary driver of shortfalls. The areas that matter in deals get included in the financial modelling, and tellingly, only 44 percent of the time are people risks sufficiently reflected in this modelling.
Our research and experience in supporting nearly 1,400 deals every year point to one thing: people. Traditionally, people are considered an expense, and therefore, the value they bring to deals is on the cost side of the ledger. What gets missed is that people are the delivery vehicle for revenue. The right leadership team, the right skill sets and the right understanding of organizational goals are what drive deal value. Yet these issues are frequently neglected in putting a deal together. And, in many cases, they are viewed as items that will “get figured out” or be dealt with after day one.
NOTICING THE RED FLAGS
There are often red-flag statements that signal the presence of unresolved people issues in a deal. These statements do not explicitly call out people risks. Instead, they suggest that significant misalignment of goals and misinterpretation of messages among the workforce is likely.
Phrases like “This is a merger of equals” can imply that nothing needs to change and that people should continue what they were doing and how they were doing it, even after the deal is made.
Bu hikaye SME Magazine Singapore dergisinin Issue 21, 2021 sayısından alınmıştır.
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Bu hikaye SME Magazine Singapore dergisinin Issue 21, 2021 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Giriş Yap
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