A banking executive proud of surviving decades of mergers and acquisitions is suddenly afraid of the unprecedented turmoil the credit crisis has unleashed
Sharon, a senior operations manager at a financial institution that has just been bought, has seen plenty of turnover, turmoil, mergers, and acquisitions in her 25 years in banking, but nothing like the current crisis on Wall Street. And she's been on both sides of the deal: her company has done the taking over; she's worked for companies that have been bought. Sharon has always been one of the people who has survived every regime change, and she prides herself on the fact that every boss she has acquired has quickly seen her worth and expanded her jobs. Her titles, sphere of influence, and net worth have grown commensurately.
She's confident that her impressive track record at her recently purchased employer will earn her points with the new C-suite team she has to impress. For each of the last seven years, every profit center she has been in charge of has seen growth year to year and quarter to quarter. In two of the last five years, her division was one of only three that was profitable in the global company, putting the company well in the black.
Still, there are some troubling signs after the sudden announcement of this recent, fire-sale purchase. Several of her peers, not just in the U.S. but in other parts of the world, have already left, and despite what the official company communiqués say, Sharon knows that most of them haven't left to "pursue other opportunities and spend more time with their families," even though they'll probably do more of the latter than they would like, given the tight job market. "These are really good people, and I mean good at their jobs," she says. "Two years ago, even a year ago, it would have been unthinkable that any of these people would have left without other jobs to go to—that they would have been forced to leave."
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What troubles her even more, however, is the change that has come over her boss, a normally communicative, confident leader who has become withdrawn and tightlipped. "I know he signed a three-year contract last year so the fact that he seems so worried worries me," she admits. Sharon hasn't been able to get a meeting with him to find out if her reporting structure will change, if she'll be getting more employees, or who her counterpart is at the other company.
Despite her own strong track record, what's happened to her peers and that she doesn't know what's going on with her boss does dent her confidence a little bit. "I'm just trying to do my job, but it's hard because people who report to me directly are asking me a lot of questions that I can't answer," she says. "Also, I feel a tremendous responsibility to the people who work for me. I've had to cut a lot of staff in the last 18 months and they've all absorbed a lot of extra work and I want it to have been worthwhile for them. A year and a half ago, there was more opportunity out there and plenty of them could have pursued other things, but they stayed here in part because they were part of a great team that we had built together. I hope we can keep our team and our culture intact."
She gives herself 60-40 odds that she'll still be in her job in six months. "I think my track record speaks for itself, and I know how to cut costs while maintaining high performance," she says. "If this had happened 18 months ago, I probably would have started looking for a job right away. Now, I just don't know. It's too hard to read the tea leaves right now."
If you're on the losing side of a "shotgun marriage" acquisition, you probably have little time to plot your next move, says author David D'Alessandro
If you have 12 eggs, put about two of them in the basket of being able to stay at your job, David D'Alessandro advises employees of vanquished companies. "It's not a question of how good you are, or your value to the company," he says. "Chances are, if your company is one that has been acquired in one of the shotgun marriages made necessary by the financial crisis, the company that conquered yours has someone who already does your job, and the advantage is going to go to the person who came with the acquiring company."
D'Alessandro, author of Brand Warfare, Career Warfare, and Executive Warfare (all published by McGraw-Hill Professional, which, like BusinessWeek, is owned by The McGraw-Hill Companies (MHP)), points out that these shotgun marriages will bring about a whole new set of rules for how companies merge. "You won't see culture clash," he says. "There won't be time or tolerance for that. One will just absorb the other, and you can guess which company gets absorbed."
Normally, when companies merge, it's a process that has been many months in the making. Departments and key personnel at both companies are evaluated for their strengths and weaknesses even if it's a merger of unequals, or a less-than-friendly takeover. "In those cases, you stand a much better chance of being able to keep your job, provided you're good at it and offer real value," he says. "It's about picking the strongest components to make the whole stronger."
Living on Borrowed Time
A completely different mindset is in play when one company acquires a weaker or devastated rival. "People think in terms of winners and losers, and by default, if you work for the company that had to be bought or rescued, they're the loser and by extension you'll be thought of one as well," he points out. Merit won't even enter the equation.
The "conquered" and "vanquished" mindsets of winners and losers will permeate all levels of the organization, D'Alessandro asserts, from the C-suite to the administrative staff. While you'll basically be living on borrowed time, D'Alessandro says, there are things you can do to make the most of that time.
He advises you to be as helpful and supportive as you can to the new regime, especially your new boss, who will be looking for any excuse or opportunity to get rid of you. "If the plans ultimately call for you to be gotten rid of, if you're not providing any value to them in the short term, they'll think, 'Why not just do it now?'" he says. Your most valuable asset isn't how good you were at your job; it's your knowledge about it and the organization. "Give that to them," he says. "It's all you have that can't be duplicated, outsourced, or gotten at a cheaper price."
Of course, the more you give away your institutional knowledge, the less value you have to your new bosses. And that's why you should be looking for a job from Day One. "You probably have [a] minimum of three months, maximum nine—if you're lucky—to stay on the job because of information and skills that the new team will find valuable," he says. "Don't waste any of that time."