Understand the new players
A few months back, Goldston made a personal visit to FTD to
make sure he understood what its people were about. While the
company was probably more used to getting flowers, Goldston
believes a more personal touch is required.
He spent four days in FTD’s Chicago office and took the time to
speak in front of every employee. He also met with every single
member of the senior management team — all 40 of them. His
hands-on approach played to what he thinks is most important
when you’re acquiring a company: You have to get to know them.
“Why do so many acquisitions fail? Let’s face it, they’re done by
smart companies with smart investment bankers,” he says. “Why
do so many of them fail? Because it’s the conquering theory: ‘We’re
going to force our culture onto your company’ — that doesn’t
work. You have to be able to meld and assess people, assess their
skills and make them feel post-deal they’re not part of an us and a
them.”
That initial assessment requires the hands-on approach Goldston
uses. Instead of sending out his people to figure out if a company
can fit with United, he makes sure he does the scouting.
“Most guys that I know that are peers of mine, they send out their
advance teams, they do the work, they report back and decisions
are made, and the only people the CEO meets are probably the
CEO, the CFO and maybe one or two other key players, that’s it,”
he says. “You rarely meet a CEO who’s met people 40, 60, 100 deep
in an acquired company.”
When Goldston is looking at a company’s people, he is trying to
figure out the work ethic and job capabilities of the company.
“Part of it is, is it very clear to me and to them what their jobs are
and how they are doing,” he says. “Some of that has to do with the
overall corporate fortunes, the other has to do with how does the
head of marketing and his or her marketing department perform.
What do they do, what’s their work ethic like, what’s the quality of
their work product like, and what kind of people do they appear to
be?”
If a company doesn’t have the clear makings of what will work
with United, Goldston won’t close the deal.
“Buying a great brand name and a company that you perceive to
be a great enterprise that doesn’t have great human capital, will
not be a great company,” he says. “You see some of these big brand
names go bankrupt and you’re like, ‘Wow, how could that company go bankrupt, everybody’s heard of them?’ Yeah, well, what kind
of people did they have?”
