The 1990s saw sharp increases in the value of mergers and acquisitions. In the United States, the value of mergers rose almost tenfold, from $195 billion in 1990 to $1.75 trillion in 1999. Worldwide, the value of merged businesses increased almost seven times, from $464 billion to $3.4 trillion. Examples of such mergers (some completed and some proposed) include America On-line and Time Warner, Exxon and Mobil, MCI and Sprint, CBS and Viacom, Vodafone Airtouch PLC and Mannesmann, Pfizer and Warner-Lambert, and AT&T and Media One Group.

There are specific forces in today’s global economy that are driving this parade of mergers:

• Huge stock market gains increase the availability of funds for acquisitions.
• Mergers are a relatively easy way to obtain new ideas, products, and markets.
• Mergers encourage increased efficiencies through consolidation and economies of scale.
• Deregulation of the transportation, energy, telecommunications, and finance industries has opened the door to mergers where they were once discouraged.
• The cold war’s end gave impetus to acquisitions within the defense industry.
• Computer advances have enhanced management of huge organizations.
• Once a significant merger occurs within an industry, those firms not involved seek their own deals in order to stay competitive.

As long as the above forces hold sway, we can expect continuation of the trend towards more and bigger mergers and acquisitions. Therefore, it would not be surprising if your job search or continued employment become dependent on the status of an employer that is somehow involved in a corporate merger. What may mergers mean for your career?

On the positive side, mergers may make the organization more profitable and secure; protect the firm from global competition; provide access to new products and services; and increase sales. For those employees who enter or remain with the business, this may mean greater job security, expanded opportunities to tackle new areas and learn new skills, new promotional possibilities, and attractive stock options.

On the negative side, consolidation may mean shrinking promotional opportunity, demotion, or even layoff, especially during periods of recession. Familiar and friendly managers may be replaced with new leadership. People issues often take a back seat to systems and procedures. With one corporate culture usually dominating, many employees must adjust to new work rules. Increased travel, long hours, employee turnover, and pressure to combine or eliminate various departments that appear duplicative or unnecessary depress work environments during early stages.

Those who have experienced mergers first hand have the following advice:

• Be optimistic about the benefits of the merger; don’t be a roadblock.
• Take things one step at a time, in an honest and forthright manner.
• Do all that you can to obtain information about the acquired firm.
• Seek to establish communications and good relations with appropriate staff.
• Don’t offer uninvited, critical opinions or advice.
• Relieve tension by talking to friends outside the firm or playing sports.