The 'smart' of the deal: putting people first
- Larry Gennari
- 20 hours ago
- 3 min read
I’ve been counseling buyers and sellers in M&A transactions for decades. For sellers, I often pose the same fundamental questions: Why do you want to sell? Do you have a number in mind? Will the business measure up under due diligence? Buyers face important questions too. Why are you buying this company? Will this acquisition on these terms achieve strategic objectives? To move forward, each side must satisfy its pivotal concerns.
One common issue is among the most vexing: What happens to the people after closing? Getting this right can sink or seal a deal. That’s why both buyers and sellers need a few new, thoughtful books.
"Achieving synergies" is euphemistic deal-speak for firing people post-closing. Sure, cutting expenses is a top priority (especially if you are part of a fictitious government agency but aren’t old enough to rent a car), but numbers can’t tell the entire story. Many people in a broad range of positions and across industries do the unrecognized, and unrewarded “connective labor” essential to maintaining the social architecture of a place, according to Johns Hopkins Professor Alison Pugh, author of the must-read book The Last Human Job. Replacing intake nurses, coaches, therapists — even business development people — with AI may seem efficient, but Pugh’s practical advice and compelling examples reveal the stakes for any organization. Job titles alone can’t describe that go-to person who listens deeply and makes quiet change.
Indeed, eliminating positions without knowing the people in them is business malpractice. Who Is Government: The Untold Story of Public Service, the timely new book by Michael Lewis, illustrates this point precisely. Lewis and six other talented writers profile selected federal workers, highlighting how their unique talents and projects contribute to improving our collective lives. I want to meet Jarod Koopman, IRS agent, black-belt martial-arts instructor, and head of a small cybercrime team that shuts down terrorist money-laundering operations and seizes billions of dollars to return to victims of crime and the U.S. Treasury. Dedicated people doing essential work are assets, not liabilities. We should hope they’re all still employed.
Moreover, if the sole focus is on tech and costs, leaders can forget the very purpose of the deal. Adam Becker, science journalist and author of the provocative new book More Everything Forever, urges business and policy leaders not to assume that Silicon Valley’s luminaries and tech gurus know more about balancing profit, technology and people than the rest of us. Billionaires such as Jeff Bezos and Elon Musk, he argues, rationalize their deployment of technology and marketplace dominance as advancing and transforming humanity. The challenge is that their peculiar vision of tech-enabled immortality and a vast utopia in space isn’t widely shared — or even open to criticism, debate or scrutiny. AI-powered machines don’t and won’t prioritize human goals over optimal efficiency. Becker convincingly argues that social problems, like global warming and systemic inequality, require social solutions. That means more persuasion, deeper connections and common useful goals — not just more advanced AI.
Of course, these authors all converge around a larger point beyond M&A deals. Shareholder capitalism and the relentless focus on maximizing profits all the time, every time, with every decision, is failing people in transactions, as well as all of us. That’s why Michigan Professor Andrew Hoffman wrote Business School and the Noble Purpose of the Market, a thought-provoking new book and call to action for business schools and business leaders. The world faces monumental problems that can be addressed through commerce, so long as inspired business leaders recognize their work as a calling to a collective good. Hoffman deftly unpacks a lot in this relatively short book, including how Nordic and Scandinavian market economies create the happiest people in the world — and why corporations are not people with equal human rights.
This tumultuous economy will bring more M&A. Here’s hoping that buyers and sellers remember what’s at stake.
Read in the Boston Business Journal
Larry Gennari is a business lawyer and chief curator of Authors & Innovators, an annual business book and ideas festival. Watch recent interviews with authors here. Gennari also teaches Project Entrepreneur, a business fundamentals bootcamp for returning citizens, at BC Law School.