When companies are involved in mergers or acquisitions, the impacts can be wide-ranging. Multiple workforces are often consolidated in the name of strategic synergy. Staff who remain may feel overwhelmed and anxious, wondering if their jobs are secure. Morale can suffer.
This environment can have a disruptive effect on design and construction projects, especially large, multiyear programs. Managers are challenged to assure project continuity as responsibilities are reallocated among staff who may not have the project history, institutional knowledge and long-term commitment needed to shepherd projects to successful completion.
Having worked as an owner and a contractor on design and construction projects in this environment, I’ve observed some things that can help them succeed. Among them:
Strong strategic partnerships and relationships. The leaner the owner’s workforce, the more important it is to develop partnerships with suppliers who can help fill capability and continuity gaps. Often, these owners choose to work with trusted partners with deep institutional knowledge and a history of success with the owner organization. The partnership approach can also extend to an owner’s procurement process. Long bidder lists may help secure the lowest price in the short-term, but bidding comes at an eventual cost — both direct and indirect. Lean companies tend to limit the bid table to strategic partners that bring a variety of competitive advantages to the process, including the ability to provide continuity in the event of staff turnover during projects
A lean owner workforce with subject matter experts, engineering leadership and a small team of project managers and construction managers. Competitive owner companies tend to concentrate their most robust staffing in the areas of their core competencies. That’s just good business sense. The challenge for owners is to identify the optimal staff needed to manage the workload, while satisfying synergy goals. Contracted staff for engineer-procure-construct (EPC) projects, not a core competency for operating companies, are designed to be lean, agile and project-focused. Contracted EPC personnel can also be centralized or regionally distributed depending on how the owners’ project sites are best served.
Clear communication. When companies merge, information that may seem clear at upper management levels can become muddied as it travels to the bulk of the organization. Companies that communicate directly, candidly and regularly with staff can help minimize anxiety and low morale. The value of clear communication can also extend to all stakeholders who wish to understand the potential impacts on their projects and contracts.