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The deal model may account for revenue growth, margin improvement, synergy capture, integration cost, and capital requirements. Beneath the same model are assumptions that receive less scrutiny: key leaders will stay, critical talent will remain engaged, culture friction will be manageable, employees will trust the new owner, and the acquired capability will scale inside a different operating model.
Planning for these assumptions to become realities doesn’t just risk upending your talent strategy. It risks future value creation.
The CHRO's role in M&A is changing. Beyond managing diligence checklists, integration plans, benefits, retention, and communications, CHROs can help CEOs and boards answer a more commercial question: will the talent system required to deliver the deal thesis survive the transition?
Here are five ways Russell Reynolds Associates has observed leading CHROs drive successful M&As.
Every acquisition rests on assumptions about people. Some are obvious: key executives will stay, teams will remain productive, and retention plans will work. Others are less visible: acquired leaders will adapt to a larger enterprise, informal influencers will support the transition, and new ways of working will not slow execution.
The CHRO's distinctive contribution makes those assumptions explicit. What leadership conditions must be true? Who is most likely to leave and how might we get ahead of that risk? What cultural attributes must be protected? What organizational capabilities must be built? Where could people-related risk erode the value case?
Acquisition success depends on a clear view of the leaders, roles, capabilities, relationships, cultural attributes, structures, and organizational context. This people-value thesis should be built before the integration plan, not after leaders discover which assumptions were wrong.
Understanding the value drivers behind a deal also means understanding where that value depends on people. Alongside assets, technology, market position, and scale, value may be carried by specific leaders, specialists, client relationships, or teams whose capabilities are difficult to replace. The deal thesis should therefore identify both what creates value and who is essential to preserving and extending it after close. And those value carriers do not always sit where the organization chart might suggest.
Consider a common pattern in capability acquisitions. The executive leadership team looks important—and it is—but the true value may sit below the top team: the product leader who built the approach, the client-facing expert trusted by the market, the technical specialist others rely on, or the manager who holds the team together. If those people are not identified early, the acquirer can retain the visible leaders while losing the capability that made the deal attractive.
Identifying value carriers is only half the question. The acquirer also needs to know whether they can succeed in the context they are about to enter. Many acquired leaders are moving from a speedboat to an ocean liner. Some will thrive with scale and infrastructure. Others will struggle with slower decisions, more governance, new incentives, and reduced autonomy. The risk is not that they lack talent; it is that the environment in which their talent was effective may be changing faster than they are prepared for.
The CHRO can help the deal team avoid confusing past performance with future fit. Who can operate with more governance without losing momentum? Which leaders need coaching, sponsorship, or a different role to succeed? Which departures would materially weaken the deal thesis?
Consider a familiar integration failure. A large company acquires a smaller specialist business for its innovation, speed, and close customer relationships. Within months, the buyer introduces its approval layers, reporting cycles, procurement processes, and enterprise policies. Decisions slow, key leaders become frustrated, and clients begin to experience a different company. The business has been integrated, but much of what made it valuable has been weakened.
The lesson is not that acquired companies should be left untouched. It is that the integration model should follow the value thesis. The acquirer needs to be clear about which elements must be combined to create value and which must remain distinct to preserve it.
Full integration can create scale, alignment, governance, and efficiency. It can also erode the speed, identity, customer intimacy, or entrepreneurial energy the acquirer wanted to buy. In some deals, the acquired business is valuable precisely because it operates differently. It moves faster, makes decisions with fewer layers, gives experts more autonomy, or maintains a client intimacy the larger enterprise struggles to replicate.
The CHRO can help the CEO and integration team decide what must be standardized quickly, what should remain distinct for now, which leaders need autonomy to remain effective, and which cultural attributes are sources of value rather than quirks to be cleaned up.
Culture belongs in this same conversation. It shows up when leaders decide whose process prevails, whose pace sets the standard, whose voice counts, and which parts of each organization’s legacy are worth preserving. If the top team continues to behave as representatives of the legacy organizations, integration may be structurally complete but behaviorally stalled.
Ambiguity is expensive.
Employees in acquired organizations are not waiting for a long-term strategy presentation. They are asking immediate, practical questions about their role, manager, benefits, ways of working, team, and future in the company. When answers come slowly, people fill in the gaps themselves. In competitive talent markets, they often leave.
Many acquirers over-rely on financial retention tools. Retention bonuses may be necessary, especially for critical roles. But money alone rarely creates commitment. People stay when they understand their future, trust the leaders communicating with them, and believe the new environment offers a credible path forward.
Providing that clarity requires more than a day-one town hall. The strongest acquirers use several levels of communication: senior leaders explain the rationale for the deal and its future direction; department heads translate what it means for their part of the business; and managers address the practical questions affecting individual teams. Managers should be briefed early and equipped with consistent talking points, FAQs, guidance for difficult conversations, and a clear route for escalating questions they cannot answer.
Employees also need a reliable source of truth that distinguishes what has been decided, what will remain unchanged, what is still under review, and when further answers will be available. Town halls, small-group sessions, open forums, and anonymous question channels can then be used to identify where uncertainty remains. Leaders should regularly share what they are hearing and how they are responding, rather than allowing questions to disappear into a feedback process.
Practical uncertainty can quickly become strategic risk. Employees may understand the broad rationale for the deal, but their decisions are shaped by immediate questions: Will my benefits change? Will I still be remote? Who will I report to? Is my role safe? The people most confident in their market value are often the first to test it.
Not every answer will be available on day one. Credibility comes from being transparent about what is known, honest about what is not, and disciplined about when and how the next answers will be provided.
For the CHRO, clarity is not cosmetic. Providing clear and consistent responses to the practical questions new talent will ask—and equipping managers to continue that dialogue—is an early test of whether the acquirer can build trust quickly enough to preserve the value it bought.
One of the most underappreciated gaps in M&A is the failure to define what success looks like on the people side of the deal. Most organizations track financial performance rigorously. Far fewer define success in terms of leadership effectiveness, team integration, retention of critical roles, knowledge transfer, cultural alignment, or the ability of the acquired organization to keep delivering the capabilities the buyer valued.
If the people assumptions were material enough to support the deal, they should be visible enough to manage after close. The CHRO can help turn those assumptions into a simple people value scorecard: who must be retained, what leadership transitions matter most, what must be true at key integration milestones, and what indicators show that people-related value is being created or eroded.
The CHRO does not own every outcome alone. But the CHRO can ensure that the people conditions required for value creation are defined, tracked, and discussed with the same seriousness as revenue, cost synergies, systems integration, and operating milestones.
Before signing—and again before close—CEOs, boards, deal teams, and integration leaders should ask the CHRO five value-critical questions:
M&A may begin with a financial model, but value is realized through leaders, teams, culture, and execution.
The CHRO's mandate is to make the human assumptions behind the deal visible early enough to test, protect, and manage them. In that sense, the new M&A CHRO is not merely supporting the transaction. They are helping design the conditions that allow the deal thesis to become enterprise value.
Mehrdad Derayeh is an Executive Director at Russell Reynolds Associates, focused on helping organizations create value through leadership at moments of transformation and growth. He is based in Toronto and New York.
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