The importance of employee feedback in Mergers & acquisitions (M&A)

Mergers and acquisitions (M&A) are complex, transformative processes. Not only for companies, but also for their managers and employees. While financial, legal and strategic aspects are usually at the forefront, one crucial success factor is often overlooked: employee feedback.

In this blog article, we shed light on why employee feedback is essential before, during and after M&A processes and how companies can benefit from it.

Why employee feedback plays a key role in M&A

In times of change, uncertainty, rumors and resistance are frequent companions. Employees ask themselves:

• “What does this mean for my job?”
• “How will my role change?”
• “Is the new company a good fit for me?”
• Regular and structured feedback provides a platform for recognizing fears at an early stage, promoting acceptance and building trust.

1. Before the M&A transaction: recognizing fears at an early stage

Goal: Create transparency and strengthen trust

Employee feedback should be taken into account as early as the preparation phase of an M&A process. Anonymous surveys, focus groups or employee interviews help to gauge sentiment and identify potential resistance.

Best practice:

“A DAX company conducted an internal pulse survey before acquiring a competitor and discovered cultural concerns early on, which were taken into account in the M&A strategy.”

2. During the M&A process: accompanying change

Goal: Improve communication and manage change processes

Feedback is particularly valuable during the integration phase. It helps to evaluate internal communication, identify problems in real time and maintain employee loyalty.

Recommendation:

Introduce continuous feedback loops – for example via our short two- to four-weekly mood barometer or virtual feedback workshops. Show that feedback is taken seriously and can actively influence and is incorporated into decisions.

3. After the M&A process: ensuring sustainable integration

Goal: Strengthen culture and ensure long-term satisfaction

After the successful completion of a merger or takeover, it is important not to let feedback stop. Employee feedback helps to evaluate cultural integration, uncover hidden conflicts and establish the new “we-feeling”.

Tip:
Use qualitative interviews, follow-up surveys and personal discussions to gain a deeper perspective.

Studies on M&A processes and the importance of feedback

McKinsey & Company (2019): “Managing and supporting employees through cultural change in mergers”

McKinsey emphasizes that cultural differences and a lack of communication are common reasons for the failure of M&A transactions. The report shows that companies that actively seek and consider feedback from employees are more successful at integration. Regular employee surveys help to identify cultural tensions at an early stage and take targeted countermeasures.

Guerrero (2008/2009): Changes in employees’ attitudes at work following an acquisition: a comparative study by acquisition type

Uses survey data to examine how employee identification, uncertainty and job satisfaction develop after friendly versus hostile takeovers. Findings: Communication, networking between teams and supportive measures significantly reduce uncertainty and promote integration.

Bansal (2020): Thinking of mergers and acquisitions? Think of justice: a people perspective

Analyzes how perceived justice (procedural and interactional justice) during post-merger integration influences employee retention, satisfaction and ultimately synergy achievement. Result: Perception of justice significantly strengthens commitment .

Dua & Ahlawat (2024): The Impact of Mergers and Acquisitions on Employee Satisfaction: Examining Effects on Retention, Morale and Productivity (in Indian Banks)

This quantitative study shows that M&A activities are strongly linked to changes in employee satisfaction, retention and productivity. The results prove this: Satisfaction and employee retention are crucial for post-integration performance.

Phase	Study	Insights / Realization	Implementation
Before the M&A	Guerrero	Early uncertainty measurement	Use a survey before the start of M&A
During the M&A	Bansal	Strengthening justice	Transparent communication & fair processes
After the M&A	Dua & Ahlawat	Satisfaction ensures productivity	Follow-up feedback and retention programs