15 February 2008

Merger uncertainties at Yahoo!

Clear communication for uncertain times.

The unsolicited bid by Microsoft is having its impact on Yahoo! employees – news reports say they're thinking of jumping ship.

But the bid process is likely to be protracted, fuelling fears of slow integration later and delayed development projects. Yahoo! says Microsoft’s offer is too low, while investors are poised to take advantage of any price increase.

Don't be hostile
David Ferrabee, (pictured, right) managing director, change & internal communications at Hill & Knowlton, this month's Hub editorial board guest expert, emphasizes the importance of giving reassurance in situations such as hostile bids.

Leaders are inclined to say very little to avoid any communication that could leave the company a hostage to fortune.

Reassurance is key
"Unfortunately that’s not the best approach. It’s best to get back to the business and reassure employees," Ferrabee says. He also stresses the importance of communicating with investors, the market and even the hostile bid company that this is a solid high-value business.

Ferrabee is seeing several businesses now waking up to what happens when they say nice things about themselves in public. "It has a direct impact on the way shareholders feel about you, which affects the company, which affects your ability to borrow, which affects your ability to expand and so on," he says.

Continuity is vital
His advice for internal communicators is to focus on business as usual. "Business continuity is a fundamental whenever a major change happens in the company," he says. "You need to prioritize what’s important while also recognizing the changing situation."

Most people come to work to work. "They don’t want to come in to worry or stop working," Ferrabee says. He adds that they want reassurance, to understand the circumstances and see how they might be affected. Internal communicators can help people focus on what needs to be done.

Explain the timescale
The main fear people have is for the changes to affect them almost immediately. Ferrabee explains that acquisitions are rarely completed within 9 months, and often take much longer. The bid must be successful first, regulators may be involved, the legal work and due diligence will all need to be completed.

Once people know the timescale, then they can apply the appropriate level of anxiety," Ferrabee says.

"We often think of internal communicators as focusing on people at the sharp edge – when in fact one of the key things they should do is advise senior leadership in these situations."

Report developments internally
Ferrabee suggests communicators remind leaders of their communication obligations towards the business they're running.

"Leaders must continue to talk in a way that doesn’t leave employees off-side," Ferrabee says. "No one wants to find out about their job by reading the morning papers. In these circumstances leaders tend to forget and talk to the media first."

Have your say
Any crisis situation is bound to worry employees, simply through fear of the unknown. Most will think they’ll be affected immediately, whereas in situations like hostile bids, the change will take many months to impact – if it ever does.

In the meantime, your company could lose some of its best people. This is a particular danger in knowledge-rich companies where key knowledge assets (staff) can walk out the door – possibly to a competitor – at any time.

What do you think is important for communicators to do during a situation like this? Does the rumor mill get to you last? How often do your senior leaders approach you for advice? Or, if you’re in the know, maybe you get to them first?

Discuss these issues with other comms practitioners by joining the Internal Comms Hub members' group on the Communicators' Network.

Related articles and resources:
How to manage the people side of mergers

TOP TIPS: Six ways to communicate effectively during a merger

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