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									             Insight on Coaching
Managing Through Mergers and Acquisitions Transcript




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Time        Speaker              Transcript

0:31        Tom Floyd            Hello everyone and welcome to Insight on Coaching.
                                 Insight on Coaching explores the many facets, flavors, and sides of the emerging
                                 professional coaching field.
                                 I’m Tom Floyd, the CEO of Insight Educational Consulting and your host on today’s
                                 show.
                                 Well today’s show focuses on how coaching can assist managers and corporate
                                 executives, guide their companies through mergers and acquisitions. Topics
                                 discussed include:
                                     How coaching can be used to help leaders create strong and effective work
                                     teams.
                                     How coaching can bridge cultural differences across organizations that are
                                     coming together and help leaders and managers communicate with confidence.
                                     And how coaching can ensure the retention of key employees as individuals from
                                     different companies and cultures come together.
                                 Well to get started I’d like to share some recent information and interesting tidbits that
                                 some folks in our research team came up with related to mergers and acquisitions.
                                 Take a listen to this.
                                 According to Dealogic, in 2006 mergers and acquisitions in the United States totaled
                                 310.7 billion, which is a pretty astounding number.
                                 Substantial mergers and acquisitions in 2006 occurred between organizations
                                 including General Motors and Cerberus, Alcatel and Lucent, Boston Scientific and
                                 Guidant, NTL which is a UK-based cable company and Virgin Mobile, and the
                                 National Bank of Greece and Finansbank of Turkey just to name a few.
                                 Now the technology sector also saw a significant number of mergers and acquisitions
                                 as well, for example AT&T acquired Bell South.
                                 I’m sure a lot of our listeners have heard about the acquisition between Google of
                                 YouTube last year.
                                 Cingular acquired AT&T Wireless, and then Hewlett-Packard also acquired Mercury
                                 Interactive which is a company here in the Silicon Valley.
                                 Well to kind of step back though before we speak with some of our guests more
                                 about this let’s talk a little bit about what a merger is exactly.
                                 Doing a quick scan on the web according to Wikipedia, a merger is a combination of
                                 two companies into one larger company.
                                 Such actions are commonly voluntary and involved stock swap or cash payment to
                                 the target.
                                 Now a stock swap is often used because it allows the shareholders of the two
                                 companies to share the risk involved in the deal, and another important thing to note
                                 is that a merger can kind of resemble a takeover in some situations but can
                                 sometimes result in a new company name which could combine the names of the
                                 original companies and potentially new branding and other factors as well.


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       Confidential   |   October 22, 2008
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       Managing Through Mergers and Acquisitions Transcript
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                             Now also according to Wikipedia’s definitions an acquisition can take the form of a
                             purchase of the stock or other equity interests of an acquired organization or it can
                             also result in the acquisition of all or a substantial amount of the acquired company’s
                             assets.
                             Now our team looked at data from other sources as well and for example according
                             to the Harvard Business Review mergers and acquisitions can occur for five primary
                             reasons those this list is certainly not exhaustive:
                                 One, to deal with over capacity through consolidation in mature industries.
                                 Two, to roll up competitors in geographically fragmented industries.
                                 Three, to extend into new products or markets.
                                 Four, as a substitute for research and development.
                                 And five, to exploit eroding industry boundaries by inventing an industry.
                             Now in change management terms in our organization IEC also considers mergers
                             and acquisitions to be a type of transformational change which means a significant
                             change that effects the company’s missions, its strategy, its culture, environment,
                             workforce, and essentially the company’s overall identity or who the company really
                             is at its core.
                             So it’s a pretty big change.
                             Well as you can imagine challenges and problems certainly occur during mergers
                             and acquisitions.
                             Depending on the type of merger Harvard Business Review indicated there can be a
                             variety of challenges including quickly having to decide what stays and what goes in
                             the newly merged company which Harvard Business Review describes as
                             rationalization.
                             Also, if the acquiring company is as large as the company being acquired and both
                             have differing values and processes determining how to bring these two radically
                             different groups together.
                             Power struggles and fights for control of the new company between the management
                             groups of both organizations can certainly come into play as well.
                             And also not extending enough outreach to stakeholders within both of the
                             organizations coming together and really involving key influencers or resisters
                             impacted by this major change in the process.
                             Well as we said at the beginning today’s show really focuses on how professional
                             coaching can be used to help individuals involved in a merger or acquisition and I
                             really think we’re going to have a lot to talk about today and I’m looking forward to
                             hearing from our guests’ perspectives on many of these items.
                             So hopefully this helped set the stage for a lot of folks out there.
                             Well let me go ahead and before we jump into our conversations with our guests I will
                             give you a quick overview of both of them.
                             I am very happy to welcome two guests to today’s show; Emily Crawford and Tim
                             Dorman.

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   Confidential   |   October 22, 2008
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   Managing Through Mergers and Acquisitions Transcript
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                                 Emily Crawford is an acknowledged expert in creating value in the human resources
                                 function with more than 20 years’ experience in talent management and
                                 organizational development she’s provided strategic counsel to a variety of firms in
                                 the retail industry.
                                 Currently, Emily also provides consulting services to organizations seeking to perfect
                                 the human side of business.
                                 Previously as Chief Learning Officer for Saks Incorporated, Crawford was
                                 responsible for directing talent assessment, education, and development for more
                                 than 50,000 employees.
                                 She received a President’s Award for saving more than 5 million in hiring and training
                                 expenses at a major retailer, a $500,000 grant from the National Retail Federation
                                 Foundation to develop the Fundamentals of Retail Management Program.
                                 The 2006 Brandon Hall Excellence in Learning Award and the Bersin and Associates
                                 Learning Leaders Award for 2006.
                                 Welcome to the show Emily.



6:40        Emily Crawford       Thank you.



6:41        Tom Floyd            Our next guest is Tim Dorman.
                                 Tim Dorman leads the Leadership Coaching and Development Group of Korn/Ferry
                                 International, helping executives, teams and corporations around the world achieve
                                 their highest levels of performance and potential.
                                 He brings an effective blend of general management experience in a publicly held
                                 company, twenty years of consulting in executive coaching, organizational
                                 development, executive search and career management and nine years of corporate
                                 human resource management.
                                 He has coached senior executives in a wide range of industries including media,
                                 financial services, high technology, health care, transportation, manufacturing and
                                 retail.
                                 Tim is a frequent speaker to professional groups on leadership development,
                                 organizational change issues and international business.
                                 He is a member of the International Coaching Federation.
                                 Welcome Tim!



7:28        Tim Dorman           Thank you Tom.




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       Confidential   |   October 22, 2008
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       Managing Through Mergers and Acquisitions Transcript
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7:29        Tom Floyd            Now today’s show is going to be a group discussion.
                                 I’m going to pose questions to both of our guests as a panel to get the group’s
                                 thoughts and to get both of your thoughts.
                                 Now Tim and Emily kind of starting out from a big picture perspective my first
                                 question really is why is coaching an important intervention to consider when going
                                 through a merger or acquisition?
                                 Tim, let’s start with you.



7:55        Tim Dorman           When you were sharing your research Tom that your team put together I was
                                 reminded of some additional research that has indicated that despite best intentions
                                 the majority of mergers and acquisitions fail to achieve the financial objectives which
                                 were part of the driving force that led the merger or acquisition to begin with which
                                 then poses the question what happened to the best intent, why did they fail.



8:31        Tom Floyd            Exactly.



8:32        Tim Dorman           And one of those primary reasons again and again and again is because they did not
                                 pay significant attention to the people’s side of the equation that at the end of the day
                                 are responsible for driving the relative success or failure of that merger or acquisition
                                 and you’ve got cultures that simply could not come together effectively.
                                 Coaching is simply a very, very effective vehicle to address that reality.



9:05        Tom Floyd            And in terms of really thinking of people in the equation from your perspective what
                                 really keeps companies from doing that?
                                 Is it that they’re so focused on the actual financial side and wanting to make it
                                 happen as quickly as possible that just kind of pushed off to the side or-



9:21        Tim Dorman           That’s a great question because the reality is if the answer is simple why doesn’t
                                 everybody do this?



9:30        Tom Floyd            Exactly.




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       Confidential   |   October 22, 2008
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       Managing Through Mergers and Acquisitions Transcript
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9:31        Tim Dorman           And I think part of it is simply sort of the thrill of the chase and the focus on the
                                 financials and trying to drive those and yet if you take a look at the acquisitions and
                                 mergers that have been successful you will typically find a very, very high correlation
                                 to a very effective focus on the people’s side of the equation.



10:07       Tom Floyd            Got it.



10:08       Tim Dorman           I’ll leave it to Emily to come up with the reason why more people are not participating.



10:13       Emily Crawford       I’ll give it my best shot.



10:15       Tom Floyd            Go ahead.



10:16       Emily Crawford       Well I totally concur with you Tim and when I was thinking about the question there
                                 are so many people at so many different levels who are going to be affecting the lives
                                 of front line workers, managers, and up the ladder to their partners and they don’t
                                 pay enough attention to the people side of the business and all of the changes that
                                 people are going to experience through the acquisition or the merger.
                                 So many decisions that have to be made and I think that one of the reasons that the
                                 people side is left out very often is that the people’s side of the business doesn’t have
                                 a financial amount, a financial aspect of the business that they can say it costs us X
                                 number of dollars to communicate with people, it costs us X number of dollars to
                                 manage performance, it costs X number of dollars to educate them.
                                 So very often that variable in the equation isn’t included. So they’re after the financial
                                 chase and they don’t really know how much the people’s side of the business is
                                 costing them.



11:32       Tom Floyd            Or is necessarily thinking about too what the costs are if for example the company
                                 they’re acquiring suddenly a bunch of people leave.



11:41       Emily Crawford       Yes.



11:41       Tom Floyd            That hasn’t been messaged correctly to kind of keep them on board and in alignment
                                 with what’s going on.



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       Confidential   |   October 22, 2008
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11:47   Emily Crawford       And knowing that what happens is the merger and acquisition has to re-interview and
                             rehire their people.



11:57   Tom Floyd            Got it.
                             Well I’m hearing the music for our first break, let’s go ahead and go on pause. More
                             on mergers and acquisitions and how coaching can help when we get back.



14:50   Tom Floyd            And where we had left off we had just introduced both of our guests, Emily Crawford
                             and Tim Dorman and really talked at a high level about why coaching is an important
                             intervention to consider especially in terms of the people side of the equation.
                             And kind of continuing along that same line of thought the next question that I really
                             have for both of you is who typically gets coached during a merger or acquisition?
                             In other words who are the primary audiences that are key targets for coaching
                             during a merger or acquisition?
                             Emily, let’s start with you.



15:41   Emily Crawford       Well I’m not sure and Tim perhaps you can comment on this too I’m not sure there is
                             executive coaching or coaching in its strictest sense where people are given advice
                             based on information and there’s a plan of development or change or improvement.
                             I would suspect that there’s more of a consultative approach with the senior
                             executives, the decision makers, and the people who are going to be closing the deal
                             so to speak there’s obviously financial advice, there is people advice, there’s
                             operation systems processes, and a goal that they have to achieve but I think the
                             advice comes in the form of consultative approaches and they generate a lot of
                             reports and they’ve generated a lot of data that supports the decision to merge or
                             buy.
                             I think some more front line people, middle managers ought to be involved in not so
                             much the decision but how to execute it and that’s where I think the void is in
                             coaching employees.



16:55   Tom Floyd            So then currently from your perspective a lot of the coaching has been typically done
                             with executives of both companies so to speak, the company being acquired and the
                             company doing the acquiring.



17:05   Emily Crawford       Yes.




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   Confidential   |   October 22, 2008
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   Managing Through Mergers and Acquisitions Transcript
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17:05   Tom Floyd            Really working with them but not necessarily focusing more on middle managers and
                             other folks within the organization who are also impacted.



17:14   Emily Crawford       Exactly.



17:15   Tom Floyd            Okay, got it.
                             Tim, what are some of your thoughts?



17:19   Tim Dorman           In a similar vein for the merger or acquisition to be effective and for that matter for the
                             coaching itself to have any value it needs to be fully integrated with the rest of the
                             merger and acquisition plan, and as Emily stated there’s a piece of that that may be
                             very consultative in terms of working with a CEO to identify sort of what the optimal
                             processes might be in terms of handling if you will the people end of the business.
                             Coaching the CEO in terms of how to communicate most effectively, cascading that
                             down in the organization to the people who have responsibility for essentially sharing
                             that message with their respective teams, and making sure that you are also
                             including the key talent of both firms, both firms, both enterprises who are being
                             impacted by this organization so that they are not observers they are participants in
                             the process and it’s a mix of consulting to them relative to roles and messages that
                             need to be delivered but also coaching to help them do that as effectively as
                             possible.
                             Typically those kind of efforts do not cascade down in the organization sufficiently but
                             the reality is you can take the same approach in terms of working with teams at all
                             levels of the organization to one to ensure that they have the message relative to the
                             change that is occurring and their respective roles in it and any recommendations
                             that they may have to move forward most effectively.
                             And then on a group basis doing some work in terms of how their particular
                             workgroup teams can respond most effectively to these changes as work needs to
                             continue.



19:47   Tom Floyd            And how frequently or how common is it for the typical CEO or executive involved in
                             a merger acquisition to really think I think I might need some help during this, I think I
                             might need some coaching, I think I could really use some guidance in this.
                             Do you see that as something that commonly happens or do you see perhaps the
                             converse in some cases where they might feel you know what this is very hush-hush,
                             I don’t want any of this to leak out, I don’t feel comfortable getting advice or confiding
                             in anyone as I’m going through this we’ll just figure it out.




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   Confidential   |   October 22, 2008
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   Managing Through Mergers and Acquisitions Transcript
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20:18   Tim Dorman           Well I think the reality Tom is that a CEO faced with a potential merger or acquisition
                             is definitely going to seek counsel from the outside but that counsel will typically take
                             the place of investment bankers, lawyers, and significantly less frequently that of
                             executive coach or organizational consultant.
                             I think therein lies the challenge for some of the reasons that Emily had talked about
                             earlier that there’s a piece here that is just as critical to the success of the
                             organization but because perhaps it can’t be modified and in the rush to get things
                             done sometimes it doesn’t get the attention and resources it should.



21:11   Tom Floyd            Got it.
                             Emily, anything you would add?



21:14   Emily Crawford       Yes, and during these mergers and acquisitions there’s typically the transitional
                             process that is developed internally and/or in addition to consultative services from
                             the investment bankers, from the financial officers, et cetera.
                             Within this transitional plan there are details in terms of orchestrating sequences of
                             events that have to take place.
                             In that is the communication, in that is the plan to execute, and Tim you also said
                             earlier that more involvement from people will really generate a more successful
                             merger or acquisition and therein lies the opportunity, is that people who are
                             executing to this plan should be coached at all levels because every time a new
                             decision is made that is going to effect execution of this plan it’s going to snowball
                             into something else, it’s going to if it’s a financial decision it’s going to effect
                             operations, if it’s an operational decision it’s going to cost money, it’s going to effect
                             the lives of the people.
                             So the more involved various levels of executives can be in this execution and be
                             coached to deliver good messages the better off the merger will be.



22:37   Tom Floyd            And how does that coaching really change as you kind of go down in the
                             organization?
                             Do you find that it’s typically one-to-one coaching for the CEO and executives and it
                             involves maybe a one-to-one kind of the next level down then it becomes kind of
                             group sessions?
                             Is it only one or two folks that you’d recommend or involve from a coaching
                             perspective? Is it a team of coaches that come in?
                             Is it facilitated sessions with managers and employees kind of further down the
                             chain?
                             What does that tend to look like?



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   Confidential   |   October 22, 2008
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   Managing Through Mergers and Acquisitions Transcript
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23:08   Emily Crawford       My experience it looks like very often that managers are coached to coach
                             employees, and when companies decide to go a little deeper they will offer group
                             sessions for employees.
                             So the employees, the frontline people, the managers of those frontline people may
                             not get one-to-one, they get more group coaching where they’re advised as to how
                             best communicate, they’re advised in terms of what the plan is and where their part
                             in the plan is but the one-on-one is usually reserved for higher level executive
                             positions.



23:52   Tom Floyd            Got it.
                             Tim, any thoughts there?



23:57   Tim Dorman           The only think I would add is that our experience has been that the most effective
                             mergers and acquisitions have occurred when people at all levels of the organization
                             participate early on, not just in the sort of the transfer of information in terms of what
                             is coming down but very early on participating in what should be traveling up.
                             So within a respective work group what are their needs, what are their concerns?
                             They may not know precisely all of the factors behind the merger or acquisition or
                             what is going to transpire but they do have needs, they do have recommendations.
                             If you take, and let me give you an example, frequently what you see at the time
                             around a merger and acquisition is a dropping off in terms of market share between
                             the two organizations.



24:59   Tom Floyd            Interesting.



25:00   Tim Dorman           And if you can go to a sales team or a customer service team on the front end letting
                             them know in general terms what is going to transpire but getting recommendations
                             from them in terms of how do we maintain the highest level of customer service.
                             What do you need from us in order to feel good about the work that you’re doing
                             during this transition?
                             And so there’s a communication up as well as a communication down.



25:30   Tom Floyd            So it’s not just typically, it typically could be followed I guess as one way but in reality
                             what you’re saying is a lot of successful mergers and acquisitions involve
                             communication both.




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   Confidential   |   October 22, 2008
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25:39   Tim Dorman           That’s correct, and the coach can play the role of catalyst in making that happen.



25:44   Tom Floyd            Got it.
                             Now in terms of kind of what or when the coaching activities typically begin it sounds
                             like you both are definitely saying that the earlier the better, what does that typically
                             look like?
                             So right when the announcement is made it begins?
                             Does it start before the actual announcement is made and then kind of the next part
                             of that question is how long is coaching generally needed then?



26:12   Tim Dorman           Which of us would you like to proceed?



26:13   Tom Floyd            Go ahead.
                             It doesn’t matter.



26:16   Tim Dorman           I think it’s important to remember that in a merger you’ve got change occurring at
                             different times for different people.
                             At the time that you go public with a perspective merger at that point it may be old hat
                             for the Chief Executive Officer who may have been having confidential discussions
                             for 6 months but it’s absolutely brand new to somebody else, and so if you look at
                             merger as a change event it’s very important to see where people are in terms of
                             timing and the coaching that you may be doing with the CEO has nothing to do with
                             how do you handle the ambiguity of change and everything to do with how do you
                             communicate most effectively the change that is going to occur.
                             And then you’ve got other people at exactly the same time are hearing it for the first
                             time and for them they’re entering a new unknown world, and so the coaching with
                             them may be how do you respond effectively to change?
                             What are the things that you should be doing in this brave new world that is
                             dramatically different than it was yesterday?
                             So I think it’s important to look at coaching not as a discrete event that occurs at one
                             point in time and continues for X number of months and then stops as much as a
                             continuum contingent upon the needs of the respective constituencies.




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   Confidential   |   October 22, 2008
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27:45   Tom Floyd            Got it.
                             Well I’m hearing the music for our next commercial break.
                             We’ll go ahead and go on pause. More on mergers and acquisitions and the
                             effectiveness of coaching in these situations when we return.



30:26   Tom Floyd            For those of you just getting tuned in today, today’s show focuses on mergers and
                             acquisitions and how coaching can be helpful in a merger/acquisition situation.
                             And where we left off before the last break we were spending some time talking
                             about when coaching typically occurs and who it typically occurs with during a
                             merger and acquisition.
                             Tim you really brought up a great point around the importance of change
                             management and really knowing or understanding where people are in the process,
                             so for the executives being involved up front if they’ve been talking about it for 3 to 4
                             months they’ve already accepted that change, they’re aware of it, that’s going to be
                             new to other people.
                             And one of the things that came to my mind in that is there’s something that our
                             company uses called the wave model which a lot of other change management firms
                             use as well and instantly that popped in my head.
                             If you think of a change as a wave and the first kind of a four-phase process there,
                             the first phase that really hits you is denial and shock.
                             So if you find you that you lost your job for example you’re so shocked about it that
                             that’s where you spend some time before you can even begin to deal with it.
                             The next step in the process being anger or defensive retreat; this isn’t happening,
                             you’re denying it, you’re angry about the change if it was a job that was lost.
                             Then it’s really exploration; okay, I don’t accept this yet, I’m willing to keep my mind
                             open to it, and then acceptance and adoption most importantly, okay, I get the
                             change, I’m dealing with it, I understand where I’m going with this and I’m moving on.
                             So it’s almost like when I heard you say that you really almost have to understand
                             where people are by department, by group, or by individual in that process and kind
                             of coach them accordingly around that.
                             Emily, any thoughts?
                             Anything that you would add there?




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   Confidential   |   October 22, 2008
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32:35   Emily Crawford       Yes, I really believe in the work that William Bridges did in his book called
                             “Transitions”, and one of the key points that organizations have to remember as all
                             levels of their employees go through this change process is that they’ve got to help
                             their employees and coach their employees to come to an end about the way it used
                             to be.
                             So today we are company A tomorrow we’re going to be company B.
                             Until you let go of company A and what work was like and how I worked in that
                             organization.



33:02   Tom Floyd            Right.



33:02   Emily Crawford       You’re never going to move onto company B and be productive.
                             So the coaching really has to acknowledge the fact that yes change occurs for
                             different people at different times and some people are going to get stuck in company
                             A and they don’t want to leave.



33:17   Tom Floyd            That’s almost like they have to be able to let it go first, let it go before they can kind of
                             move on even thinking about the other thing.



33:26   Emily Crawford       Correct.



33:27   Tom Floyd            It amazes me sometimes on a personal note the similarities between coaching in this
                             case and dating, it’s almost like telling somebody okay well I still love my ex-wife or
                             my ex-husband or girlfriend or whatever and it’s not time to start dating somebody
                             else yet.
                             Something like dating for the workplace; well I haven’t let go yet, I was dating that old
                             company.



33:45   Emily Crawford       You’re absolutely right.



33:46   Tom Floyd            I had a relationship with them.



33:48   Emily Crawford       Before you can move on you’ve got to let go what you had before.



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   Confidential   |   October 22, 2008
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33:51   Tom Floyd            Exactly.
                             Well it makes total sense to me.
                             Well I guess the next question that I would have we’ve covered this a little bit but do
                             you think from both your perspectives does the type of coaching differ from or should
                             I say the company that’s doing the acquiring and the company that’s getting
                             acquired, or does it really come down to the things we’ve already been talking about
                             that helping people accept the change on both sides and move past it?
                             Emily?



34:21   Emily Crawford       Yes, and again I think it’s going to really depend on what goes on at the front end
                             and how it’s communicated because what organizations have to look at is is the new
                             company being the boss, and are they thinking in terms of well we’re buying this
                             company, this other organization so they’re going to have to assimilate into our
                             organization?
                             So what you have to look at is what kinds of communication and processes are you
                             instituting that will help the two come together?
                             And pick processes and norms and culture, the good part of what both companies
                             have to come together to create this third organization.



35:14   Tom Floyd            So it can be almost common for some the acquiring company to think no you’re going
                             to conform to us.



35:21   Emily Crawford       Exactly.



35:21   Tom Floyd            When the reality is no we’re both conforming to something new and we need to
                             agree on this new thing together?



35:27   Emily Crawford       Yes, and that’s why in our work at the Kabachnick Group we believe in using surveys
                             and assessments to get to that point because the type of coaching will vary based on
                             who’s acquiring whom.



35:43   Tom Floyd            Now what’s some of the trends in data and things like that that you tend to find from
                             some of the surveys and assessments that you use?




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   Confidential   |   October 22, 2008
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35:51   Emily Crawford       Well again a strong belief in what we do is right and we believe that the customer or
                             the product should be developed this way.
                             We have a point of view of our market share, we have a point of view about systems
                             and customer service operations, and so what comes out is that the organization who
                             is acquiring the other organization is imposing everything on the company they’re
                             buying.



36:20   Tom Floyd            Got it.
                             Tim, any thoughts?



36:26   Tim Dorman           Frequently even in a company, even in a situation that is being characterized as a
                             merger there is always a stronger of the two equals and that’s very important to
                             acknowledge, and many times in a merger while there may be lip service paid to
                             we’re going to find this new third way the dominant culture of the dominant firm in the
                             merger or acquisition will prevail.
                             In those particular cases the coaching that goes on within the dominant party is
                             primarily going to be around how do you plan and execute and communicate as
                             effectively as you possibly can.
                             The coaching that will go on with the company that is less dominant will be one of
                             how do you respond as effectively as you possibly can, and how can you retain your
                             identify and control, and how can you secure alignment in this new organization.
                             If as truly does exist in some cases there is a new third way that is established so
                             that it’s not one culture or the other that is dominating as much as the new one that’s
                             emerging them the coaching becomes the same for each.
                             And how do I take the best of what I’ve done in the past and integrate it into this new
                             organization and how do I check the excess baggage at the door and embrace the
                             change that’s coming?
                             And ideally when you move into an organization that has gone through a merger and
                             acquisition it’s wonderful to think that you’ve got this new third way that is going to be
                             the best of both worlds, but at the same time I think it’s important to be pragmatic,
                             keep your eyes open, and make that judgment call in terms of what you have
                             because you may need to respond to it quite differently dependent upon what the
                             strategic direction is.



38:48   Tom Floyd            Got it.
                             And in terms of the frequency where you really see one culture that’s really dominant
                             would you say that’s fairly common where one typically tends to be stronger than the
                             other or is it really kind of a good mix?




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39:02   Tim Dorman           My experience has been that there will usually be one that is dominant that will
                             prevail.
                             It may be enlightened dominance, it doesn’t mean that it’s bad at all it’s simply that
                             one organization will dominate, and I think it’s the exception rather than the rule
                             where you have an integration of equals and a brilliant, insightful, rewarding third way
                             established.



39:35   Tom Floyd            Got it.
                             And we’re getting close for our next break.
                             I want to go ahead and slip one more question in before we go to break and that’s
                             kind of if both of you had to really quickly list out helpful ways or tips that in terms of
                             how coaching can help companies retain key employees from both organizations as
                             they come together what would some of your suggestions be?
                             Emily?



39:59   Emily Crawford       I would start with re-recruiting my top players, my top talent, and making sure I knew
                             who those people were because as soon as there’s an announcement or an inkling
                             that companies are going to merge most of our utility companies, communication
                             companies we probably know that’s going to happen before it starts to happen and
                             having a plan in place to make sure that I the company and the managers in the
                             organization spend time with top talent because as soon as that announcement goes
                             out the head hunters and the recruiters are going to start coming out of the
                             woodwork.



40:37   Tom Floyd            Interesting.
                             And that might not necessarily just be the top talent at the top of the food chain per
                             se but other key directors, key individual contributors, key engineers, key subject
                             matter experts that are IT literally if the person leaves that’s going to really effect it.



40:52   Emily Crawford       Totally, so include that in the plan of how you’re going to include those people in the
                             communication and really think about re-recruiting them.



41:02   Tom Floyd            Got it. I like that.
                             Tim, anything that you would add or recommend?




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41:08   Tim Dorman           Same thing; get them involved early, seek their recommendations as opposed to
                             simply sharing your plans, and I believe that our experience indicates that getting
                             your key players involved in executive coaching that is fully integrated into the rest of
                             the transition plan is a very pragmatic, tactical, high-yield approach to retaining your
                             top talent.



41:44   Tom Floyd            And kind of if we look at the typical merger or acquisition how may in terms of a
                             percentage people would you say end up leaving on average during this process?
                             Would you say its 10 percent, 40, 50, 60?
                             What does that generally look like?



42:02   Emily Crawford       I’m thinking.



42:02   Tim Dorman           I have seen situations where 100 percent of the talent that they considered to be high
                             potential mission critical has been retained in both the acquiring firm and the firm that
                             was being acquired.



42:23   Tom Floyd            Okay.



42:23   Tim Dorman           Which is quite extraordinary.



42:25   Tom Floyd            Yeah, definitely.



42:27   Tim Dorman           And the opposite of that is equally true where particularly after sort of retention
                             bonuses may have run their course where you will have a majority of your mission
                             critical people leaving the organization within 6 months.



42:50   Tom Floyd            Got it.
                             Well I’m hearing the music for our last break here so let’s go ahead and cut to
                             commercial and when we get back more on mergers and acquisitions, we’ll give you
                             a scenario to talk about and we’ll wrap up the show.
                             Stay tuned everyone.




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   Confidential   |   October 22, 2008
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Time    Speaker              Transcript

45:33   Tom Floyd            For those of you just joining us again today’s show focuses on mergers and
                             acquisitions.
                             For the last portion of this show what I’d like to do is give both of our guests, Emily
                             Crawford and Tim Dorman, a scenario and kind of talk about some of the things that
                             they might recommend from a coaching perspective based on that scenario.
                             So here’s the scenario so I’ll give everyone a few minutes to think about this; so in a
                             strategic move to expand and grow its business a production company tells its
                             employees at its New Jersey location that a press release will be going out in the
                             weeks to come announcing that the company is acquiring another operation and
                             moving its headquarters to Orlando, Florida in the next year.
                             The new facility will be twice the size of the existing facility and the acquisition
                             supports many corporate goals identified for the fiscal year.
                             The CEO goes as far as to say that he has received and appreciated the support he
                             received from the state and county local governments.
                             Now not a lot of information is given beyond that although the CEO emphasizes that
                             more information and details will be communicated throughout the organization
                             through the management chain, and that managers at all levels will be going into a
                             series of meetings after the announcement is made.
                             Kind of stepping back from that and turning to both of you.
                             I’m going to start with the first question here kind of from your perspective what type
                             of coaching interventions or support should be offered to employees immediately
                             after that announcement is made?



47:10   Emily Crawford       I’d like to start with that one.



47:12   Tom Floyd            Yeah, go ahead.




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47:10   Emily Crawford       If you don’t mind.
                             What needs to happen there is first step is to establish criteria for an effective
                             message about this change because again this may be the first time that employees
                             are going to be hearing this and that message has to have some very clear elements
                             to it.
                             It has to be very succinct, no jargon, communicate, over communicated,
                             communicated often, and re-communicated, and also includes what the goals are,
                             what’s the first step?
                             Where are we going?
                             Where are we headed?
                             And they have to be honest about expectations, and it’s really nice if, and very
                             effective if the communication message includes metaphors and stories, and the
                             message answers some key questions for employees.
                             What’s this change about?
                             Why are we making this change?
                             Give me some financial information.
                             Give me some reasons and rationale for initiating this change.
                             Who’s going to be impacted?
                             And what are you asking me to do going back to our earlier comments about getting
                             everybody involved.
                             If a company can answer those questions and develop and craft their message to
                             answer those questions I think the organization is off to a really good start.



48:44   Tom Floyd            In terms of the frequency you touched on that a little bit right when it’s made, do you
                             find, are we talking about constant communication, is it daily? Is it weekly? Is it bi-
                             weekly?
                             Particularly right after that announcement is made how important is frequency?



49:01   Emily Crawford       Frequency, there’s something that’s going to happen every time a task or a
                             component of this strategy is executed and it’s going to start snowballing into
                             operations and how people work.
                             So I’m not sure there is a magical formula, I don’t know of one in terms of frequency
                             but it may be that my direct supervisor should talk to me everyday for a period of time
                             until I know exactly how to work differently.



49:33   Tom Floyd            Got it. Tim?



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49:37   Tim Dorman           People are going to be talking about the merger or acquisition every day, every hour
                             so really the question is the extent to which you want to influence that, and the
                             frequency should be driven by that and then I would concur with Emily.
                             And it’s not so much coaching that needs to occur through an outside third party;
                             ideally it’s terrific if this can be integrated into how the managers operate and convey
                             information and also how they themselves are behaving.
                             But as soon as that CEO makes the announcement of we’re hiring a firm and we’re
                             moving to Orlando all of a sudden there is a tremendous vacuum and the bottom line
                             that everybody rushes to immediately be what does this mean for me and how am I
                             going to be impacted?
                             And to answer the collective what does this mean for me the CEO has to be able to
                             communicate effectively, frequently, and with the highest level of trust possible.
                             This is what we know, this is what we don’t know, this is the process that we’re going
                             to go through to determine what the changes are, here is our timeline, and I think that
                             if a CEO and by extension the leaders who are driving that merger or acquisition can
                             demonstrate and continue to earn a high level of trust among the employees people
                             will respond in a very effective way.
                             When there is an absence of trust all of the processes in the world don’t make any
                             difference.



51:47   Tom Floyd            So kind of that lack of trust or once somebody really senses that it’s almost like it can
                             cause them to shut down in this situation.
                             In terms of mentioning the importance of managers in this situation and like coaching
                             and guiding them, how could middle managers continue to guide and support
                             employees through the transition?
                              What are some good, key practices for middle managers to keep in mind?




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Time    Speaker              Transcript

52:14   Emily Crawford       Well I mentioned earlier that you have to give up the old way before you can begin
                             the new and within that thought process middle managers have to understand that
                             between the ending and the new beginning there is a hiatus, in between letting go of
                             the old way and taking hold of the new there’s going to be difficult times and this is a
                             dangerous phase when systems don’t work very well and people lose heart easily,
                             and so middle managers have to recognize that they’ve got to perhaps build in some
                             temporary sources of support and whether it’s having more coaching sessions,
                             having more staff meetings so that they keep them well informed and they have to
                             build in these temporary sources so that that trust that Tim was talking about
                             continues to build.
                             The more information you have the less likely you’re going to go out and create your
                             own rumors about what people are going to have to go through or who’s losing their
                             job or who’s staying with the company.
                             So I think those kinds of interventions really help organizations maintain their
                             business during these mergers and acquisitions.



53:36   Tom Floyd            Now I had worked with one client I loved the term and communication they did
                             around this so much that we recommended this idea to another firm that we worked
                             with.
                             They actually implemented a Rumor Management Hotline, and that’s what they
                             called it and that’s what they communicated around.
                             So it was if you are hearing anything about this change call this number and they had
                             people dedicated just to kind of saying yes, this is what’s true, no, that’s what’s not
                             true, this is what’s going on around that, and I really liked that.



54:07   Emily Crawford       Great, great tactic.



54:09   Tom Floyd            Tim, any thoughts there?



54:11   Tim Dorman           From a very tactical point of view what’s important to remember is that it’s not
                             business as usual, it’s business as unusual.



54:19   Tom Floyd            I like that.




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   Confidential   |   October 22, 2008
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Time    Speaker              Transcript

54:21   Tim Dorman           And as such it’s going the extra mile to communicate both through formal rumor
                             hotlines and in terms of informal accelerated management by walking around and
                             staying in touch with people, and within your respective work teams that you’ve got
                             responsibility for focusing equal amounts on both the professional and the personal,
                             what is the work that we have to get done?
                             How do we maintain the highest level of customer service in this time of extraordinary
                             change and uncertainty?
                             How do we do that?
                             And how can we help each other?



55:00   Tom Floyd            Got it.



55:00   Tim Dorman           And let’s acknowledge that all of the problems that we have on an individual basis
                             and find ways to support each other in that effort.



55:09   Tom Floyd            Got it, excellent.
                             Well a huge thank you to both of you for joining us for today’s show.
                             And as always I want to say thank you to all of our listeners for spending time with us
                             today as well.
                             For more information about our show you can look us up on the Voice America
                             Business Channel, you can visit our website at www.ieconsulting.biz, and you can
                             also feel free to shoot me an e-mail me at tfloyd@ieconsulting.biz .
                             Don’t forget you can look us up in Apple iTunes as well for the podcast version of the
                             show, just go to Music Store and enter Insight on Coaching in the Search field.
                             Thanks again everyone, we’ll see you next week.




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   Confidential   |   October 22, 2008
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