From finances to facilities, there are a lot of moving parts to nail down during a merger or acquisition. Employee transition is one critical area that should not be overlooked before, during and after the transaction. In today’s labor market, acquiring and retaining a well-trained, highly skilled workforce spares buyers the considerable expense of investing in an entirely new team. Here are three guiding principles to follow when merging two teams or onboarding new employees through an acquisition.
Just as due diligence is performed for operations and finances, so too should buyers scrutinize labor costs and employment policies and procedures, including hours worked, benefits, PTO allotment, telecommuting and flexible work arrangements. Watch employee count thresholds for any new regulatory obligations that could be triggered by a larger team. Clarifying differences between the two workplace environments is essential to the communication efforts discussed later in this post, as it helps team members more easily understand their role, what changes are in store and what career paths and leadership opportunities will look like under the new entity. These efforts underscore the value each employee brings to the table and helps them envision a long-term future with the company.
Proactive and frequent communication is key to a successful integration or new team member on-boarding. It also helps prevent counter narratives or inaccurate perceptions, which can be tough to reverse and detrimental to the culture you are trying to create (more on that below). As early as possible, develop a robust communications plan that includes which messages to share and when employees will receive them. While some information must remain confidential, try to be as transparent as possible and anticipate questions along the way. This approach demonstrates that employees are respected members of the team and integral to the transaction’s success. Make sure the plan includes both internal and external communications so employees are not caught flat-footed or off message when out in the community or interacting with professional peers.
Champion the Culture
During a merger or acquisition, change runs deeper than updating a logo or replacing signage. Employees must be educated and integrated into the new organizational culture. As part of the transition planning, assign several champions among the existing team who can be on the front lines helping new employees adapt and gain their buy-in around additional changes on the horizon. Take engagement efforts beyond slogans and handouts with in-person or virtual meetings, forums and activities where new team members can get to know their colleagues and feel welcomed and valued. In addition to enhancing company culture, setting a positive tone from the start and helping employees understand the benefits they’ll gain from this transaction may also help reduce the turnover that is an inevitable and unavoidable part of every merger or acquisition.
Neglecting the human aspect of a merger or acquisition can be costly, in terms of losing talent and skill in an unstable labor market. RKL’s Human Capital Management team can help companies develop a proactive and comprehensive plan to develop a unified culture and protect their employer brand in the marketplace. Contact your RKL advisor or reach out through the form below to start the conversation.