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Achieving deal value through human capital management

Many global and international businesses aim to grow and thrive through acquisitions and mergers. But with the majority of these deals failing to deliver their expected value, executives and leaders often find themselves at the end of the integration process looking back wondering what went wrong. As mergers and acquisitions become a driving force in global competition, companies are now being forced to take a closer look beyond the immediate consequences, into the complexities of integrating two – often completely different – worlds into one.

Text by Sharon Parker

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Achieving deal value through human capital management

Successful deal value depends heavily on managing human capital risk, especially at the leadership level. Companies will readily focus their energies on the integration of tangible assets such as IT systems and cost synergies, yet human capital risk management gets overlooked, often to everyone’s detriment. Often issues that arise from misaligned leadership, executive retention, and employee disengagement cloud the reality of pre-deal visions such as a higher stock price, increased revenue, and greater prominence as a leader in the market.

What makes human capital risk management so important?

It has been found that 90 percent of mergers and acquisitions do not realize their expected deal value, based on a study of 100 European companies conducted by the Hay Group in 2010. So, what are the companies that succeed in the post-acquisition environment doing right? In an evolving, recently ...