Leaders' Struggle: What to Share and Keep Quiet During Mergers and Its Effect on Employee Anxiety
Impact of Uncertainty During a Merger Can Be Even More Distressing Than an Actual Layoff
Impact of Uncertainty During a Merger Can Be Even More Distressing Than an Actual Layoff
When a big organizational change happens, like a merger between two companies or even a merger between two teams, people are wondering how everything might work.
They are wondering how they will work together with other people in the same role they have. What will the overlap be like? Or will their roles be reduced?
The cascade of information from the top of a company downward, especially in the changed time of a company merger, can fall into failure traps. We think we are clear and getting our points across but we are not. This failure of communication can spread fear and chaos.
According to Stephen Heidari-Robinson and Suzanne Heywood in their Harward Business Review article, “The psychological impact of uncertainty during a reorg can be even more distressing than an actual layoff. The longer that badly planned reorgs drag on, the more the mystery endures and the longer it takes to see the business results the reorg was intended to bring about.”
Why is Certainty so Important?
Certainty is one of the basic psychological human needs. The lack of certainty can bring big consequences as already shown above.
What happens when certainty is not there in a reorganization, especially in a merging situation and why is it important?
Reduces Stress: Uncertainty triggers the brain's threat response, increasing cortisol (the stress hormone), which makes people feel anxious, overwhelmed, and out of control. Certainty calms this response, reducing anxiety and creating a sense of stability.
Boosts Focus: When things are uncertain, people tend to feel distracted, scattered, and unable to focus on tasks because their brains are busy worrying about the unknown. Certainty helps free up cognitive resources, allowing them to concentrate and perform better.
Builds Trust: In uncertain times, people often feel insecure, mistrustful, and doubtful about leadership or their future. Certainty activates the brain's reward centers, fostering trust and making employees feel secure in their roles and the company's direction.
Tell me, what struggles do you have as a leader or employee in merging situations?
Bottom line:
This article is a food for thought one where I invite you to reflect upon how certainty is felt in your organization, what do you do as a leader to support your people to get one of their basic psychological needs met?
This is great! I am a leader in company that merged and then acquired several other companies years ago. I have seen it all, including the joy on the other side after years of hard work integrating cultures, products, processes, and of course, PEOPLE!
Great content & very clearly written Andra!