What obstacles stand in the way of successful mergers and acquisitions?

• Inability to sustain financial performance;
• Loss of productivity;
• Incompatible cultures;
• Loss of key talent;
• Clash of management styles;
• Inability to manage/implement change; and
• Misunderstood objectives and synergies.

People issues. Mergers and acquisitions often fail due to "people issues" arising from the deal. Specific people-related reasons why many mergers fail include:

• Disagreements among management about the new entity's direction;
• Infighting among legacy departments;
• Incompatible cultures;
• A sense of frustration among employees caused by lack of communication about the company's goals and direction; and
• Disputes and misunderstandings about new benefit plans, layoffs and changes in roles and responsibilities.

Many of these obstacles involve HR areas and can be avoided with proper planning and preparation.