High Stakes

Use Your Merger (Or Acquisition) to Talk About More than Just the Deal

Use Your Merger (Or Acquisition) to Talk About More than Just the Deal

We’ve all heard it: Healthcare M&A continues at a feverish pace.

Last year marked the highest number of deals in recent history – 115 according to KaufmanHall, with big transactions on the horizon in 2018.

Deals require such a tremendous amount of time and energy from everyone involved, it’s tempting to default to a mode of just getting them closed and done.

That mindset risks missing a huge opportunity. As I shared Friday at the American Health Lawyers Association’s event in Nashville, a deal supported by the right strategy offers far more than proverbial “strategic synergies.” You know, the ones that no one really understands.

Instead, deals done well, and communicated effectively, propel organizations forward. They enable hospitals and health systems to re-engage employees, explain the big picture and communicate a shared strategy in a meaningful – and human – way.

How do you do this? Start by assembling a team from your key internal players, deal counsel, communications advisors and finance and management consultants.

Leaders looking to leverage the strengths of the M&A team to realize its full potential should consider the following five best practices:

  • Hire people with battle scars. A merger or acquisition may be a rare, even once-in-a-lifetime moment for a hospital, but the great value a group of advisors can bring to the situation is experience. They know the red flags and the boxes to check to make sure a deal succeeds. They can keep you from picking up too many battle scars of your own.
  • Don’t accept cookie-cutter solutions. While your team needs to be experienced, they also need to bring fresh eyes and an objective perspective to the table. Be cautious about advisors who come with a template. Instead, work with people who use their unique experience to create the best possible customized plan.
  • Assess your bandwidth. M&A can be an incredible drain on your internal communications and legal staff. Make sure your deal team is scaled correctly to take on the scope of work. There’s a huge advantage to building the team correctly on the front end.
  • Organize early. Communicators, in particular, can help here. It’s important for the health system’s leadership, the internal team and outside advisors to work as one as early as possible. This coordination reduces the fire drills of responding piecemeal to issues that inevitably arise. Agree on a clear shared success and create a communications structure early.
  • Take care of your own. Internal audiences are mission one. Nothing kills a deal faster than physician opposition, for instance. From the get-go, outside advisors must work side-by-side with internal leaders, who should form the core of the M&A team. Together, the right strategies to engage internally can be executed and built out to the broader stakeholder universe. In other words, inside out. Always.

 

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