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Diversity of Thought: Carlos Mallen on building diverse teams post mergers and acquisitions

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Carlos Mallen is Senior Vice President, Human Resources for the Americas and Europe at Exela. Prior to the formation of Exela, he was the SVP, Human Resources for Americas and Europe at SourceHOV. Before joining SourceHOV, Mr. Mallen served as the Head of Human Resources for Mary Kay Latin America, building a skillset that includes HR strategy, organization design, employee relations, recruiting, compensation and benefits, international assignment services, and employee recognition. Mr. Mallen has a Bachelor’s Degree in Industrial & Labor Relations from Cornell University and holds a General Course Diploma from the London School of Economics and Political Science.

Carlos, a lot has been said about diversity and inclusion but there is little to no guidance of building diverse teams post-mergers and acquisitions. Can you share some of Exela’s best practices?

Exela is a new brand that exists since 2017. Prior to that, it was a group of smaller companies put together through mergers and acquisitions. We are a very diverse company employing people of different generations and walks of life. Add to that cultural diversity as Exela operates in more than 20 countries and you will see the big picture.

Diversity post-merger has two main aspects:

  1. Cultural diversity at a national level, and
  2. Cultural diversity at a company level

It all starts pre-merger with getting to know the entry group of people, their values, ambitions and aspirations. Each organisation has its own way of doing business and standard operating procedures. Communicating early on what Exela’s expectations and values are is key to building a strong diverse team post-merger. Setting clear expectations and providing guidance delivers great results and helps to address the insecurity that is often associated with mergers and acquisitions. It is normal for the people to ask themselves what their new roles and responsibilities will be, what are the chances for their jobs being cut once the deal is closed, how their remuneration will be structured going forward and much more. Providing the answers to such critical questions leads to smooth post-merger integration and motivates both teams to work as one. Even more, cultural diversity often results in diversity of thought that challenges the status quo.

Working with the management and the leadership team post-merger to understand what their needs are and how to help them to be successful adds value to the organisation as a whole. At Exela, we have been lucky as mergers and acquisitions added diversity at certain levels where it was much needed. Working with the individuals and helping them to be successful is the best practice that always works for us. This shall happen both ways – top-down and bottom-up.

In addition, Exela has many diversity and inclusion programs we are proud of. Anything from providing jobs to people with disabilities to hiring veterans to participating in various initiatives. We are very proud of supporting veterans and helping them to stay with the job.

Understanding the skills of people with disabilities and what they can do is key to creating jobs that present a good opportunity for them and attract them to these jobs. We also deploy and repeat our successful diversity hiring practices across geographies.

As you mentioned, cultural diversity may drive diversity of thought but it may also result in tension and lost productivity. How do you address such cases? For sure, you had cases when post-merger integration wasn’t easy.

You hit the nail in the head. Indeed, it is hard as we have revenue goals, EBITDA goals pre-merger and post-merger and other KPIs we need to adhere to. The way we go about achieving these goals is different each time. There is a surviving culture that is driven from the top as the CEO may still be with the company post-merger. It is championing diversity of thought and encouraging leaders to ask themselves ‘’ Hey, at Exela they are doing these things in a different way. Maybe they are right and it is worth the effort to adopt their practices.’’ If we do something in a different way, we may achieve a different result and achieve our EBITDA and revenue goals.

The decision-making process is always very critical. Often, we have a CEO who is used to making decisions independently as the company previously was not part of a big group of companies. It takes time to adjust to the new hierarchy and organisational structure. Our job is to help these leaders to continue to be effective and feel empowered in their new roles. Sometimes it is something as little as a title change but people have emotional attachments to it, and it may result in demotivation and loss of productivity. Sometimes it may be the job description and role and responsibilities that have changed. It is very personal, and each case needs to be addressed on an individual basis. Over the years, with all the companies I have been involved with, I realised that if you get the decision-making process right, everything else will flow in the right direction. Those leaders of the acquired organisation will then help their employees to understand that this is the new way of doing things, being it a new system, a new process or new approval chain for example. Getting them acquainted and accustomed to the change prevents frustration and keeps employees motivated and allows them to voice their concerns and experiences and provide recommendations.

On the other hand, if you don’t get that right, it leads to tension and frustration and people start looking around for a place where they will feel more valued.

During the years, Exela acquired many companies. Can you provide an example of post-merger integration that went really well and resulted in a strong diverse team?

There was one legacy organisation called BancTec, that was acquired in 2014. This organisation had two revenue streams – services stream and hardware revenue stream. We knew that we needed their know-how around hardware and post-merger both organisations were more profitable and efficient combining the knowledge and expertise on both sides. BancTec also had the engineering talent that was critical for our success. Over time, we engaged with the legacy leaders to understand better what the client needs are, what the marketing opportunities are and how both organisations can exchange knowledge and help each other. On the BancTec side, the leaders were of a different generation, they had a different mindset and would approach the same opportunity from a different angle. The engineering talent was also used to the legacy way of working so we engaged them in discussions around the future of our technology and the strategic direction. Later, we launched a new solution – Exela Smart Office, which is attracting a lot of attention and it is the person who was previously leading BancTec that leads it.

At Exela, we don’t make assumptions about people, we provide them with what’s needed to be successful, explain our values and then we work with them.

Very impressive! You mentioned supported employment programs. Can you tell us more about them? A lot of people are long -term unemployed due to personal circumstances and find it hard to re-join the workforce.

We identify jobs where there are not many limitations or specific skills that are required. Once we have people on board, we continuously train them so they can acquire new skills on the job and progress their careers.

When creating jobs, we try to be more open and allow people to progress fast as some of them are bright and quick learners. A good example is an employee who stopped working after marriage due to personal circumstances. After 18 years as a stay at home wife, she had to join the workforce again and it was very hard for her to secure a job. However, looking at her achievements, it was clear that she had potential and only needed to be given a chance. Now, she is advancing her career and is very happy with her job.  

No talent shall be left behind. Overcoming hardships only make people stronger and more motivated.