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Human capital management and the success or failure

of M&A
This survey seeks your views on the human-capital dimension of mergers, acquisitions,
and divestitures. We’re interested in understanding how talent management,
compensation and benefits, leadership development, organizational design, and other
components of the employer/employee relationship contribute to the success or failure of
M&A transactions.
1. Please complete the following statement with the phrase that best describes your
opinion.

Mergers and acquisitions currently play a .................. in my company's business

stragegy, compared with its industry peers.

Major role

Contributing role

Minor role

Please select at most 3 choices for question 2.

Please fill in the text box next to the selected choice in question 2.
2. To the best of your knowledge, which of the following were the primary objectives of
your company’s M&A transactions in the last two years? (Please choose up to three.)

Gain access to new markets

Improve economies of scale

Add complementary products, brands, or service lines

Vertically integrate supply chain, production, and/or distribution

Acquire proprietary technology or operating processes

Capture market share from competitors

Respond to competitive or regulatory pressure

Gain access to professional talent, engineering or operating expertise, etc.

Diversify lines of business

 Other (please specify):

Not sure/Does not apply

3. In your opinion, how well have your company’s M&A transactions in the last two years
met their primary objectives? (Please choose the one answer that best describes your
view.)

Exceeded expectations

Met expectations

Failed to meet expectations

Not sure/Too early to tell

4. Which of the following statements best describes how your company has usually
integrated its acquisitions (or has been integrated into another company) in the past two
years? (Please choose one.)

Limited integration: Transaction partners operate separately, linked by a parent

holding company or a subsidiary relationship

Absorption: The dominant transaction partner has fully integrated the acquired
company’s operations in its own operations

Transformation: The processes, practices, and assets of each transaction partner

were integrated to form a new type of company

Does not apply

5. Do you expect your company will maintain the integration structure mentioned in
question 4 or alter it in the next three years? (Please choose the one answer that best
describes your view.)

In the next three years, my company is likely to …

 Integrate acquired businesses more closely

Maintain current level of integration

Establish new independent operating units or subsidiaries

Don’t know/Too early to tell

6. In your opinion, how difficult were the following internal activities for your company
when merging with other organizations in the last two years? (Please choose one in
each row.)

N
S
o
o
V t
m
e
e
r v
w
y e
h
r
a
d y
t
i
d
f d
i
f i
f
i f
f
c f
i
u i
c
l c
u
t u
l
l
t
t
Desig
ning
huma
n-
capital
progra
ms
(e.g.,
emplo
yee
comm
unicati
ons,
comp
ensati
on
 N
S
o
o
V t
m
e
e
r v
w
y e
h
r
a
d y
t
i
d
f d
i
f i
f
i f
f
c f
i
u i
c
l c
u
t u
l
l
t
t
and
benefi
ts,
talent
mana
geme
nt,
organi
zation
al
chang
e,
etc.)
Devel
oping
huma
n-
capital
strate
gy
(e.g.,
organi
zation
al
design
,
leader
ship
teams
, etc.)
Integr
ating
admini
 N
S
o
o
V t
m
e
e
r v
w
y e
h
r
a
d y
t
i
d
f d
i
f i
f
i f
f
c f
i
u i
c
l c
u
t u
l
l
t
t
strativ
e
proce
sses
and
syste
ms for
the
financ
e and
accou
nting,
IT,
and
HR
functio
ns
Integr
ating
sales
and
marke
ting,
produ
ction,
deliver
y and
other
operat
ing
proce
sses
Please select at most 3 choices for question 7.
Please fill in the text box next to the selected choice in question 7.
7. In your experience, which of the following human-capital activities have presented the
greatest challenges when integrating acquisitions in the last two years? (Please choose
up to three.)

Cultivating employee engagement, productivity, and morale

Aligning new company culture with business strategy

Identifying and retaining high-performing employees

Managing the international aspects of merger integration (e.g., differences tied to

culture, regulation, geography, etc.)

Aligning compensation and benefit programs across the combined company

Making headcount reductions

Overcoming political and territorial distractions among senior management

Communicating the business rationale for change to employees

Other (please specify):

8. To what extent did the HR function at your company actively participate in the
following activities during M&A transactions in the last two years? (Please choose one in
each row.)
 H
R
H
RH
p
R
a
p
r
a p
t
r a
i
t r
c
i t
i
c i
p
i c
a
p i
t
a p
e
t a
d
e t
de
v
d
e
t
r
o t
y
o
li
a
t
gs
t
r o
l
e m
e
a e
o
t e
r
e x
n
x t
o
t e
t
e n
a
n t
t
t
a
ll
Targ
et
iden
tifica
tion
Due
dilig
enc
e
Inte
grati
on
plan
ning
Inte
grati
 H
R
H
RH
p
R
a
p
r
a p
t
r a
i
t r
c
i t
i
c i
p
i c
a
p i
t
a p
e
t a
d
e t
de
v
d
e
t
r
o t
y
o
li
a
t
gs
t
r o
l
e m
e
a e
o
t e
r
e x
n
x t
o
t e
t
e n
a
n t
t
t
a
ll
on
and
cha
nge
man
age
men
t

9. In your opinion, would greater HR involvement in each the following activities have led
to better deal outcomes (i.e., fewer surprises, smoother transition, greater value), or not?
(Please choose one in each row.)
 N
Yo
e ,
s g
, r
g e
r a
e t
a e
t r
e H
r R
H i
Rn
i v
n o
v l
o v
l e
v m
e e
mn
e t N
n p o
t r t
p o s
r b u
o a r
b b e
a l /
b y D
l wo
y o e
wu s
o l
u d n
l o
d n t
o a
h t p
a h p
v a l
e v y
l e
e l
d e
d
t
o t
o
b
e b
t e
 N
Yo
e ,
s g
, r
g e
r a
e t
a e
t r
e H
r R
H i
Rn
i v
n o
v l
o v
l e
v m
e e
mn
e t N
n p o
t r t
p o s
r b u
o a r
b b e
a l /
b y D
l wo
y o e
wu s
o l
u d n
l o
d n t
o a
h t p
a h p
v a l
e v y
l e
e l
d e
d
t
o t
o
b
e b
t e
 N
Yo
e ,
s g
, r
g e
r a
e t
a e
t r
e H
r R
H i
Rn
i v
n o
v l
o v
l e
v m
e e
mn
e t N
n p o
t r t
p o s
r b u
o a r
b b e
a l /
b y D
l wo
y o e
wu s
o l
u d n
l o
d n t
o a
h t p
a h p
v a l
e v y
l e
e l
d e
d
t
o t
o
b
e b
t e
 N
Yo
e ,
s g
, r
g e
r a
e t
a e
t r
e H
r R
H i
Rn
i v
n o
v l
o v
l e
v m
e e
mn
e t N
n p o
t r t
p o s
r b u
o a r
b b e
a l /
b y D
l wo
y o e
wu s
o l
u d n
l o
d n t
o a
h t p
a h p
v a l
e v y
l e
e l
d e
d
t
o t
o
b
e b
t e
10. In your opinion, how well did your company perform the following human-capital-
related tasks in the course of its M&A activities in the past two years? (Please choose
one in each row.)

E AR
x do
ceo
e qm
l u
l af
et o
ne r
t
pp i
eem
rrp
f f r
ooo
rrv
mme
aam
nne
ccn
eet
Devel
oping
a
huma
n-
capita
l
strate
gy for
the
trans
action

that
aligns
with
broad
er
deal
object
ives
Ensur
ing
workf
 E AR
x do
ceo
e qm
l u
l af
et o
ne r
t
pp i
eem
rrp
f f r
ooo
rrv
mme
aam
nne
ccn
eet
orce
produ
ctivity
and
perfor
manc
e
throu
gh
the
transit
ion
Identif
ying
and
retaini
ng
key
emplo
yees
Desig
ning
and
imple
menti
ng
comp
ensati
on
and
benefi
 E AR
x do
ceo
e qm
l u
l af
et o
ne r
t
pp i
eem
rrp
f f r
ooo
rrv
mme
aam
nne
ccn
eet
t
progr
ams
Estab
lishin
g the
desire
d
comp
any
cultur
e
Addre
ssing
the
global
aspec
ts of
workf
orce
integr
ation
Pricin
g
huma
n-
capita
l
asset
s,
 E AR
x do
ceo
e qm
l u
l af
et o
ne r
t
pp i
eem
rrp
f f r
ooo
rrv
mme
aam
nne
ccn
eet
costs,
and
risks
into
the
deal
Com
munic
ating
with
emplo
yees
(e.g.,
comm
unicat
ions
on
transit
ion
timeli
nes
and
decisi
on-
makin
g
ration
ale)
Estab
lishin
g,
 E AR
x do
ceo
e qm
l u
l af
et o
ne r
t
pp i
eem
rrp
f f r
ooo
rrv
mme
aam
nne
ccn
eet
comm
unicat
ing,
and
meas
uring
perfor
manc
e
stand
ards
acros
s the
combi
ned
entity

11. In your opinion, how well were the following human-capital factors priced into deals
at your company during the last two years? (Please choose one in each row.)
 S
o
Vm
N
ee
o
rw
t
yh
a
e
et
f
f
f
fe N
e
ef o
c
cf t
t
te
i
ic s
v
vt u
e
ei r
l
lv e
y
ye /
l D
p
py o
r
r e
i
ip s
c
cr
e
ei n
d
dc o
e t
i
id
n
n a
t
ti p
o
on p
t l
t
to y
h
h
e
et
h
d
de
e
e
a
ad
l
le
a
l
Huma
n-
capita
l
integr
ation
costs
(e.g.,
cost
of lost
 S
o
Vm
N
ee
o
rw
t
yh
a
e
et
f
f
f
fe N
e
ef o
c
cf t
t
te
i
ic s
v
vt u
e
ei r
l
lv e
y
ye /
l D
p
py o
r
r e
i
ip s
c
cr
e
ei n
d
dc o
e t
i
id
n
n a
t
ti p
o
on p
t l
t
to y
h
h
e
et
h
d
de
e
e
a
ad
l
le
a
l
produ
ctivity,
emplo
yee
retenti
on
cost)
Value
of
new
 S
o
Vm
N
ee
o
rw
t
yh
a
e
et
f
f
f
fe N
e
ef o
c
cf t
t
te
i
ic s
v
vt u
e
ei r
l
lv e
y
ye /
l D
p
py o
r
r e
i
ip s
c
cr
e
ei n
d
dc o
e t
i
id
n
n a
t
ti p
o
on p
t l
t
to y
h
h
e
et
h
d
de
e
e
a
ad
l
le
a
l
talent
and
capab
ilities
Cost
savin
gs
throu
gh
workf
 S
o
Vm
N
ee
o
rw
t
yh
a
e
et
f
f
f
fe N
e
ef o
c
cf t
t
te
i
ic s
v
vt u
e
ei r
l
lv e
y
ye /
l D
p
py o
r
r e
i
ip s
c
cr
e
ei n
d
dc o
e t
i
id
n
n a
t
ti p
o
on p
t l
t
to y
h
h
e
et
h
d
de
e
e
a
ad
l
le
a
l
orce
reduct
ion
Huma
n-
capita
l risk
(e.g.,
lack
of
 S
o
Vm
N
ee
o
rw
t
yh
a
e
et
f
f
f
fe N
e
ef o
c
cf t
t
te
i
ic s
v
vt u
e
ei r
l
lv e
y
ye /
l D
p
py o
r
r e
i
ip s
c
cr
e
ei n
d
dc o
e t
i
id
n
n a
t
ti p
o
on p
t l
t
to y
h
h
e
et
h
d
de
e
e
a
ad
l
le
a
l
emplo
yment
contra
cts for
key
emplo
yees,
collec
tive
bargai
 S
o
Vm
N
ee
o
rw
t
yh
a
e
et
f
f
f
fe N
e
ef o
c
cf t
t
te
i
ic s
v
vt u
e
ei r
l
lv e
y
ye /
l D
p
py o
r
r e
i
ip s
c
cr
e
ei n
d
dc o
e t
i
id
n
n a
t
ti p
o
on p
t l
t
to y
h
h
e
et
h
d
de
e
e
a
ad
l
le
a
l
ning
expos
ure,
etc.)
Finan
cial
cost
of
retire
ment
 S
o
Vm
N
ee
o
rw
t
yh
a
e
et
f
f
f
fe N
e
ef o
c
cf t
t
te
i
ic s
v
vt u
e
ei r
l
lv e
y
ye /
l D
p
py o
r
r e
i
ip s
c
cr
e
ei n
d
dc o
e t
i
id
n
n a
t
ti p
o
on p
t l
t
to y
h
h
e
et
h
d
de
e
e
a
ad
l
le
a
l
obliga
tions,
health
plans,
etc.

12. What advice can you offer your peers in finance and HR who are interested in
improving their company’s ability to price human-capital factors into deals? (Please enter
a few lines in the text boxes below.)
Advice to finance executives...

Advice to HR executives...

13. In your opinion, to what extent, if any, does effective management of the following
dimensions of a deal improve companies’ ability to realize the full financial value from
that deal? (Please choose one in each row.)

Effective management of…

 C
o
n
t
r
S
G i
o
r b
m
e u
e
a t
w
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h
l s
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y
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e
a
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i i
 C
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n
t
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 C
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 C
o
n
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G i
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 C
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n
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G i
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r b
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 C
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n
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 C
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n
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14. In your opinion, to what extent would further developing the following capabilities
improve your HR function’s ability to contribute to the success of M&A transactions?
(Please choose one in each row.)

Further developing HR’s…

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15. What final advice can you offer your peers who are interested in realizing the full
value of their company’s acquisitions? What should they do? What should they avoid?
(Please enter a few lines in the text boxes below.)

Advice to finance executives...

Advice to HR executives...

Please fill in the text box next to the selected choice in question 16.
16. What is your title? (Please choose one.)

Chief financial officer

EVP or SVP of finance

VP of finance

Director of finance

Treasurer

Controller

Chief human resources officer

EVP or SVP of human resources

VP of human resources

Director of human resources

CEO, president, or managing director

Other (please specify):

17. What were your firm’s worldwide revenues, in U.S. dollars, in its most recent fiscal
year? (Please choose one.)

<$500M

$500M-$1B

$1B-$5B

$5B-$10B

$10B+

Please fill in the text box next to the selected choice in question 18.
18. What is your organization’s primary business? (Please choose one.)

Aerospace/Defense

Auto/Industrial/Manufacturing

Business/Professional services

Chemicals/Energy/Utilities

Construction

Financial services/Real estate/Insurance

Food/Beverages/Consumer packaged goods

Hardware/Software/Networking

Health care

Media/Entertainment/Travel/Leisure

Nonprofit

Pharmaceuticals/Biotechnology/Life sciences
 Public sector

Telecommunications

Transportation/Warehousing

Wholesale/Retail trade

Other (please specify):

As a token of our appreciation, we're giving an Apple iPad to one survey respondent. To
be entered into this drawing, please enter your complete contact information, including
your email address, in the box below.

Thank you very much for your participation in this study.

Sam Knox
Vice President and Director of Research

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