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Why
Do Both Marriages and Business Mergers Have a 50% Failure Rate?
By
Laurence B. Valant
AUGUST 2008
- Marriages and mergers end up on the rocks 50% of the time. Many
management relationships, like husband and wife pairs, end up in
such irreversible trouble that one person simply has to go—or
be let go—often without a severance package. Accountants
are not immune to these troubles. The most abused process—and
yet also critical for long-term success in any business relationship
or marriage—is communication. More specifically, the source
of problems in interpersonal relationships is often the lack of
clear, unambiguous communication. The death knells of any relationship
are these words:
- “That’s
not what I wanted at all,” and
- “That’s
not what I thought you said.”
Two rules
can ensure success. These laws of interaction are effective in
manager–subordinate relationships, merger and acquisition
courtships, as well as in marriage. They are:
- Expectations
must be clear and quantifiable, and
- Communications
must be unambiguous.
Unfortunately,
the high rate of failure in business or marriage relationships
can often be traced to the intentional desire of the communicator
to be completely unclear about expectations. Some managers or
spouses are intentionally vague about expectations in order to
exercise power over the other person. You’ve probably heard
this in the workplace or in a marriage: “I don’t know
what I want, but I’ll know it when I see it.” That
may work when buying art, but it is a recipe for failure in achieving
positive results in a business or marriage.
Clarity of
expectations means quantifying the outcomes to be achieved. Unambiguous
communications result when people candidly, directly, frankly,
fairly, and honestly recognize reality and talk about it in sincere,
impersonal terms. Yes, unambiguous communications can be painful,
but they need not be mean-spirited or unkind. The facts are the
facts; it is what it is. Unambiguous communications are achieved
when the parties deal with the quantifiable facts openly, confront
reality, set objectives, and develop plans to follow up. Both
parties must commit to the objectives and the plans.
Only after
the communicators are completely sure of what they want can they
effectively share those expectations. If you say, “Let’s
meet on Friday to talk about the [family, business, or post-merger
business] budget,” you have failed to understand the second
rule above. An appropriate reply would be, “Talk about what
about the budget, specifically? Come on, you can tell me.”
In addition, by being vague you have abused the first rule, because
you have provided no clarity of expectations or outcomes.
Of course,
the receiver of the communication has the right and the obligation
to push back to the communicator and say, “Let me see if
I understand what you want,” which helps lead to clarity
of expectations. Receivers must practice their own form of unambiguous
communications, as well, by questioning (as needed) the directives
from the communicator. “If you want that new division (new
car, family vacation), it will cost not X, but 2X.” “OK,
go ahead.” “OK, I can do it.” Roles, responsibilities,
and expectations must be clear on both sides in order for the
initiative (and the relationship) to be successful.
Laurence
B. Valant is president and CEO of Valant & Co. (www.valantco.com),
a business performance improvement consultancy. He can be reached
at lvalant@valantco.com
or 303-589-3840.
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