There are many factors that contribute to success in M&A transactions. Many involve getting the right people into the right jobs. Unless the deal involves nothing more than physical assets (these are rare), the acquirer will need talented, high-performing individuals at all levels for the deal to reach its potential.
Consequently, it is critical to assess the target company’s human capital with the same rigor that’s applied toward assessing pension liabilities, inventories, financial statements and other significant assets. After all, people are ultimately a company’s most valuable asset and solely responsible for income generation and revenue growth. Identifying and managing people risks and opportunities usually account for the difference between M&A success and failure. In most of the cases we see, however, acquirers know very little about the human capital that may soon be part of their corporate family – at least not initially.
To learn more, read Talent Assessment in M&A: The People Factor (PDF).
Linda M. Gookin