If your healthcare organization is not already involved in mergers and acquisitions in some form, it probably will be within the next few years. Today's podcast guests want to help organizations like yours navigate through mergers and acquisitions while keeping your marketing and communications teams aligned.
CEO Stewart Gandolf spoke with Tammy Graves, Healthcare Principal Consultant with Point B; Karina Jennings, Assistant Vice President of Marketing and Communication at Providence Health and Services; and Alan Shoebridge, Senior Director of National Marketing Strategy at Kaiser Permanente. (All three worked together during an intense period of M&A at Providence Health and Services.)
We discussed their recent SHSMD 2018 presentation, “Navigating Uncertain Times: Building a Strategy to Survive and Thrive During Mergers and Acquisition,” which is available here. You can listen to our podcast below or keep reading for key insights.
When Providence Health and Services was dealing with one integration after another, Graves, Jennings, and Shoebridge spent a lot of time figuring out how to handle those mergers and acquisitions, particularly as it related to the marketing and communications departments.
Jennings says, “Each time [Providence] expanded, what we found is that marketing and communications was always at the front end.” With mergers and acquisitions, communications is a huge deal.
Marketing and communications must be engaged throughout the process. But the merging of two existing teams can complicate things quite a bit. In putting together their presentation for SHSMD 2018, they wanted to provide a roadmap for these departments to go through as little disruption as possible during an understandably stressful time.
The first thing most organizations want to know during mergers and acquisitions is what will happen to their brand. Names and logos can be highly personal. And typically, it’s difficult to get the two sides to agree.
For example, Shoebridge explained, one side won’t be willing to give an inch because they feel the community knows their brand too well. Unfortunately, this anecdotal evidence is rarely backed up with research. Marketing and communications teams must be prepared for these types of conversations, ready to provide data and market research to support representing a brand in one way or another.
But too often, a decision is made on branding without first engaging the marketing and communications team. And that can cause major issues moving forward.
Shoebridge points out that branding disagreements often end in compromise. Unfortunately, he says, “this dilutes the opportunity to really push the brand, the master brand, to the next level.” They may end up simply tacking several names onto the original organization name, and that leads to confusion. “No brand is really winning, and the brand isn’t able to position itself for the future,” he says.
Kaiser Permanente’s acquisition of Group Health is a great example of avoiding this pitfall. It must have been a difficult decision to rebrand as Kaiser Permanente, Shoebridge speculates. However, there was no confusion from the public about what was going on.
That’s why, Shoebridge says, marketing and communications departments should be involved early on in the process. “Oftentimes in marketing and communications, we don’t know about what’s going on. We come in too late when decisions have already been made. It's important to build up the right relationships so whenever there’s activity, you can be on the front end of the conversation.”
Practice and hospital branding can be a highly emotional conversation, particularly when one stakeholder feels invested in a particular brand. And sometimes, it truly is best to keep the old brand name. In any case, what’s important is to understand the progression of what may happen and prepare yourself as early as possible.
Jennings says, “None of those things start to happen without the marketing and communications teams coming together, learning who they are, understanding who they are, and figuring out how they’re going to work together.”
It’s also important to figure out how to organize and structure the team, which grows and changes significantly during mergers and acquisitions. In many ways, the success of the brand depends on how well the teams work together.
According to Jennings, Graves was instrumental in creating a methodical process with stages of work that allowed Providence Health to bring people together and listen to one another. There can be a lot of anxiety and distrust during mergers and acquisitions. It’s important to ensure the work continues so the marketing and communications teams can maintain credibility and influence moving forward.
Jennings' advice: “Be people focused. Don’t underestimate the emotion and the anxiety, and how being human can disrupt everything. And don’t make assumptions. A lot of people assume that the current structure is perfect and what someone else is doing is wrong. Really open your mind and be willing to learn and understand so you can make the right decisions for the future."
Graves focuses on accelerating and driving strategies as mergers and acquisitions take place. “A lot of times,” she says, “it feels like strategic planning and execution get put on hold. And I don’t think in this environment we can really wait around a year or two while integrations are going on. (The competition certainly won’t.)”
Graves describes a typical situation: “It’s day one of M & A work, and what do you do with the beautiful strategic plan that your organization has been putting together?” Stakeholders are too busy to deal with it, and it simply gets shelved.
She says teams must shift their mindsets. Instead, figure out how to use this integration period to drive strategic work and find value during the early stages. It’s a time for consolidation of shared services, efforts, and technology. Organizations have the opportunity to find a growth strategy along with the right decision-making and governance structure.
After all, not all staff members will be tied up during a merger. And many are feeling anxious about their new roles in the company during mergers and acquisitions. Why not focus their energy somewhere else so they can truly focus on the future instead?
Graves hopes to give other organizations a roadmap through mergers and acquisitions. But her advice is to “resist looking for a recipe. There is no perfect organizational structure. Make sure you listen first and take your discovery into consideration when you’re driving toward that future.”
Additionally, “Mergers and acquisitions can be a fabulous opportunity for you to reset the strategic direction of your organization. Don’t look at it as simply something to do, but holistically as the opportunity that it is.”