Gartner Identifies 3 Actions for Sales Leaders Following an Acquisition
Company acquisitions pose unique challenges for all the business leaders involved, but sales leaders are in a unique position to help their companies mitigate the risks and unlock value, research firm Gartner points out in a recent report.
“The sales organization is in an interesting position, as its perspective is both internal and external—how the acquisition impacts sellers’ performance, but also how it impacts sellers’ interactions with customers and prospects,” writes Dave Egloff, a senior director and analyst in Gartner’s sales practice, in the report. “With so much at stake, heads of sales must be deliberate about how they manage the transformation following an acquisition. This can be made even more difficult, as many sales leaders lack prior experience with acquisitions and/or the support needed to execute the transition successfully.”
To help sales leaders with that transition, Gartner identifies three immediate actions sales leaders should take:
- prioritize communicating to employees before customers;
- promote tactical execution over strategic understanding; and
- ensure an integration culture, not an acquisition culture.
As for the first, Gartner notes that acquisitions naturally cause uncertainly among employees, customers, prospects, and others involved with both companies involved. If unmanaged, these uncertainties can lead to employee attrition, lower revenue, and missed opportunities, but clear communication is the best way to manage the risks, the firm suggests. And all communications should start with employees first.
“While many suggest a customer-first mind-set, when it comes to acquisitions, employees must come first,” Egloff explains in the report. “Sales employees will not only be the receivers of the corporate message, they will also deliver the message to customers. Sales leaders must prioritize how the sales force is informed. Sellers should be reassured of both the current status of, and future plans for, the company to ensure that consistent messaging is cascaded to customers.”
To help promote a tactical execution instead of just a strategic understanding, Gartner identifies a number of specific value creators for sales that need to be explored leading up to and following the signing of any acquisition deal. These include cross-selling and upselling, targeting new verticals, expanding into new geographies, and developing go-to-market strategies. Sales leaders need to evaluate these value creators to look for quick wins, develop sales readiness, and create long-term plans.
“Quick wins will come from deliberate action,” Egloff writes in the report. “In many cases, the best early steps are in defining the proper routes to market and account ownership. The salesforce must be prepared to actively collaborate and reduce conflict. A ready salesforce is required to bridge the gap from quick wins to future plans.”
To ensure that the right corporate culture is in place, Egloff warns against underestimating the risks and challenges stemming from the acquisition. Integrating the combined sales forces of the two companies can pose unique challenges related to employee retention, company cultures, and go-to-market strategies.
To overcome these challenges, sales leaders need an integration strategy that includes people and perspectives from both companies to avoid alienating key talent. Gartner’s research shows that engaging employees in change management planning increases the probability of success and makes the employees more likely to stay with the company.