A merger of two accounting firms can broaden your client base, open you up to new markets and new niche services, and give you a great breadth of talent. But a merger can sometimes result in loss of clients and the exit of staff. How can you get the pros of a merger while avoiding the cons?
Critical to a successful merger is choosing the right practices to merge. Partners from both firms need to get along and share compatible business philosophies. The cultures of the two companies need to be similar since a firm’s happy clients and employees are used to that atmosphere and will most likely not want something very different. Further, neither merging firm should have any excess liabilities or pending litigation.
Emotions can run high in a merger, especially when a smaller firm is being absorbed into a larger firm. The founding partner of the small firm needs to be comfortable with relinquishing control over a company he or she has built, and the staff needs to be comfortable joining a larger organization with the many changes involved.
Once you’ve established that the firms’ partners can work well together and that the firms have compatible cultures and are otherwise healthy, the key to success is a well-thought-out merger plan, including client and staff retention planning, communication strategy, technology transition planning, succession planning, and policies and benefits adjustments, if needed.
Few people like change and they like it less if it’s abrupt and with little explanation. Develop a communication plan that will start well ahead of the merger, with specific guidelines on retaining both clients and employees. Be sure to stress to clients all the things that will remain the same and explain how the changes will actually benefit them: more services at their fingertips, more talented staff to serve them, etc. Let them know well in advance so they have time to adjust, and keep in personal contact with them, which will assure them that they are truly important to you.
Similarly for staff, maintain some familiar structures or policies, but also stress how the merger will be good for them, too. Be sure to plan policies and benefits packages so that your employees will, indeed, benefit in some way and feel valued.
Technology can be a real problem, especially if one firm was using outdated tools. All information will need to be integrated into shared systems, so develop a detailed technology transition plan, which may include transferring data from one firm to another or consolidating both firms into a new service or cloud host.
The merging firms need to be as compatible as possible and partners need to be on very good terms if the merger is to be a success. But it’s equally important to carefully plan the merger in order to retain your clients and your most talented staff. If you choose wisely and plan carefully, your merger is likely to be the beginning of a new and exciting period of growth and success for your newly merged firm.