Mergers and acquisitions are a big part of the business world and they keep the industry moving and changing. Every year, a huge number of companies merge with or acquire another company in order to increase their net worth or streamline their systems. But many, many more deals than this are attempted and fail.
That’s because M&As are not easy and if they aren’t done right there is a huge chance the deal will fall through. No matter how simple you think this major change might be, we can absolutely guarantee that it isn’t. Merging departments and systems and customer lists is almost always a nightmare. That’s why many companies employ a change manager.
A change manager is a professional who manages companies through a major change. They do this using one of a number of models proven to aid businesses in their major change. They monitor absolutely everything from start to finish, working with your teams to assure they hit their milestones, and reacting to changes as and when they happen. If you bring them in early enough, they will even try to help you find the best business to merge with. This is an excellent idea, because what you think might be a good idea might be actually impossible.
Perhaps you don’t want an M&A, but you feel like your company needs to make a major change.
In this article, we’ll discuss some of the best major changes companies manager their way through, as well as some of the most strategic M&As we’ve ever seen.
British Airways major change
In 1981, British Airways used change management in order to help the company become more profitable. It was decided that a company restructure was necessary and that change management was the best way to achieve this.
Reduction in workforce was necessary, and that is never a popular decision, but the chairman used change management to prove to senior leadership that restructure was necessary and possible, and that it would save the company a lot of money.
22,000 jobs were given the axe, including half of the board, planes were upgraded with modern jets, and unprofitable routes were eliminated from British Airways’ schedules. The changes have long since been used as a successful example of change management, and Lord King, the chairman, is credited with increasing the company’s financial strength.
Vodafone and Mannesmann acquisition
In 1999, Vodafone, based in the UK, bought Mannesmann, a German company, and immediately made themselves the biggest mobile phone operator in the world. It opened them up to major opportunities in the years that followed, including deals worth billions of dollars.
This was a major change for Vodafone, but a very strategic decision. They bought up the marketplace and made themselves a major global player, then successfully managed what must have been a major change. They’re still a huge market player today.
Netflix major change
Do you remember life before Netflix? We don’t. But there was a time before they existed, some time prior to 1997.
Originally, Netflix posted DVDs to subscribers, who would then return their items to the business, removing late fees and the fuss that came with a trip to rival companies, like Blockbusters. They disrupted the industry, eventually removing all major competitors from the marketplace, and a big part of that was due to how quickly they adapted to change.
In 2007, they began streaming online to customers, which meant there was no longer a need to wait for your DVD to arrive in the mail. They’re trailblazers. Everyone else has followed suit, though whether they’d have gotten there themselves anyway without Netflix is still up for debate. But the point is that Netflix had a choice, to change quickly and aggressively and become the market leader, or to stay where they were and be left behind. They changed, and we have no doubt it took a great deal of energy and work to do that.
It worked, too. Their subscribers were a massive 137 million in 2018, way higher than the 23 million they had in 2011.
Royal Dutch Petroleum and Shell merger
When Royal Dutch Petroleum and Shell merged in 2004, they reduced several layers of management and increased the company’s asset base. It was controversial, because they had previously been the same company, and they both held stock in a pre-existing company called Royal Dutch Shell. But that made it an easy decision to merge and save money.
Today, they’re one of only a few oil and gas majors in Europe.
This was a major change, but it made absolute sense, and with the help of proper change management methods, we’re sure it was easier than it would have been to merge with a random company.
Lego major change
The idea that a company like Lego might ever go bust is madness to most of us, but they were struggling in the early 2000s, posting a loss in sales and a huge amount of debt.
By 2015, they were the world’s most powerful brand.
In twelve years, they transformed themselves digitally, finding new sources of revenue outside of their physical product. They reinvented themselves for their new young audience and managed to stay relevant. This major change, from physical to digital, was the difference between life and death for Lego. Many other brands refused to make the change and succumbed.
Thinking of a major change?
If you are thinking of making a major change in your organisation or merging with or acquiring another company, Yorkshire Change can help.
Call 0333 090 8710 to speak to one of our experts.