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Chances are, if you've spent any time in Corporate America, your company has either been acquired, acquired another firm, or been part of a merger. Like a shark that must propel itself through the water to capture life-giving oxygen, so our corporations must move forward. The corporation's reasons for continuous advancement, though, are a bit more murky than those of the shark.

In today's corporate world, every fourth person seems to have an MBA. They're brimming with cookie-cutter ideas on how to grind out just the right financial metrics to continue staying on the sunny side of Wall Street. Sometimes this requires some financial sleight of hand, because numbers are very pesky things and without constant vigilance, they can get quite ornery.

Like any good sleight of hand, the skill is in the distraction, keeping the audience mesmerized so that they don't notice the smell of cooking books in the back room. One way to do this is growth, and the easiest way to grow a corporation is by absorbing other corporations through merger or acquisition.

Sure, you could try to grow organically by providing a quality product or service, adding customers, booking more orders, hiring more people, and generating more revenue, but that's so 19th century. Nowadays, it's just so much easier to muddy the fiscal waters by going on an acquisition binge and buying up other firms in your market sector.

On the face of it, this makes a lot of sense. You're capturing more market share (assuming the customers of your target company will stick with the new combined firm). You're neutralizing competition, since the acquired firms are now on "your side". It's a great time to make acquisitions, as companies fall on hard times and you can scoop them up for pennies on the dollar. Wall Street loves this sort of growth story. Any chart that keeps going up - whether it's sales, revenue, profit, market share, manager bonus payouts, heck, even global warming - is the drug of choice for Wall Street.

Mergers and acquisitions offer tantalizing opportunities to move money around the corporate balance sheet. All sorts of costs can be lumped into "restructuring" expenditures. Those at the top of the executive food chain always make out quite well. Stock grants are made, bonuses are paid out, corporate perks are awarded. It's all good... if you're in the corporate one percent.

Unfortunately mergers and acquisitions often they wreak havoc on employees and customers. Follow along below the logic gap for the rest of the story...

Employees know all too well the stresses of mergers and acquisition. Despite the colorful e-mails emanating from "corporate communications", it's the same sh*t, different day. We'll be joined by these wonderful, top-notch people from "NewCo", bringing with them great customer relationships, plenty of backlog, and great innovative thinking blah, blah, blah. I'm sure you're as excited as we are to welcome them into our Dysfunctional fold here at "DysCo". In the weeks, ahead, you'll be hearing more about the synergistic [insert stream of buzzwords here].

The message as received by the employees is a lot less upbeat: every time we go through this crap, there are layoffs and office consolidations. Either way, we're screwed. We're supposed to be all buddy-buddy with those people from NewCo? After they beat us out on that big contract for MegaPetrol? I don't think so.

Customers aren't usually all that happy either. At best, the merger or acquisition will be a major distraction. DysCo's employee's will be too worried about their jobs to pay attention to their work. New corporate entities require lots of legal work on contracts. When competitors merge, it gives the customer fewer options, and less opportunity to play one bidder against others to compete for their business. There's also the fear that customer service will go by the wayside when DysCo's a giant corporate behemoth.

Managers are the only group for whom these corporate perturbations may offer some positive outcomes. If they survive the merger or acquisition with their job intact, they might be able to cobble together a better role in the organization.

While Wall Street is being dazzled with emerging numbers suggesting that the merger or acquisition is yielding exactly the hoped-for benefits, employees - from the technicians through the ranks of the managers - are being dazzled with the internal story line. Now that we've acquired NewCo, we have the opportunity to upgrade our systems and processes. Translation for the overoptimistic: we'll get some cool new programs. Translation for everyone who's been through this before: here we go again.

In an ideal world, every new acquisition really could improve the growing company. Maybe they a better accounting system, a more robust safety program, a better suite of medical benefits, a stronger reputation for corporate giving, a more generous bonus program, nicer office locations, or more comprehensive training programs. Certainly they'll bring new customers, new technologies, new geographic reach. You'll have access to all this and more.

The corporate communications folks will dangle these enticements as proof that this is going to be just awesome, but in reality, it's just more sleight of hand. No, little employee, none of these things will come to pass. DysCo will still be a soul-less corporate behemoth whose only concern is the enrichment of its executives and continued gullibility of Wall Street. The only upside to this debacle for the Great Unwashed Masses is the possibility that someone will spring for a few pizzas for one of the interminable PowerPoint presentations. Most likely, though, it'll be brown-bag time.  Oh, and you'll need to work an extra hour to make up for the time you spent at the corporate presentation.

Viewed in the rear-view mirror, many mergers and acquisitions resemble a slow-motion train wreck. Those employees and managers who have their doubts will bail early rather than sticking around to see what happens. Those folks are often the brightest and most entrepreneurial (leaving the less bright/entrepreneurial colleagues behind to pick up the pieces). Customers will be lost in the shuffle as shoddy work, half-hearted customer service, and general chaos lead to broken relationships.

Countless employees will be laid off or will quit when they find that their new role or new office location is unpalatable. Folks in accounting will be set for a while, as will those in Human Resources, but everyone else will find their lives upended with no improvement to follow.

Meanwhile, the executives will have their hands full looking for ways to shelter their new wealth and keeping that sleight of hand going with the next deal. Sharks gotta swim, corporations gotta grow. In my next life, I'm hanging out with the sharks.

Originally posted to cassandracarolina's fossil record on Wed May 15, 2013 at 08:24 AM PDT.

Also republished by Community Spotlight.

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