Whether your business will shortly be put up for sale, or you are in the acquirer’s seat and considering the purchase of an existing company, a prime area of concern is – or should be – the target business’s employees.
In fact, with research indicating that top talent often leaves in the months following an acquisition, the importance of finding strategies to retain and motivate employees can’t be understated.
Fortunately, there are several tried-and-tested techniques you can use to maintain staff morale and encourage people to stick around for the long haul – not just during the M&A process but long after too.
The importance of employee engagement for your M&A strategy
It’s no secret that engaged employees are more likely to be dedicated and productive, making substantial contributions to a company’s growth.
According to Gallup, investing in (and measuring) your team’s engagement levels can have a positive knock-on effect on various crucial aspects of your company’s operations – from improved profitability and turnover to a decrease in absenteeism, accidents, and even ‘shrinkage’ (also known as theft).
Gallup went on to highlight the importance of employee engagement during a disruption – and that can surely apply to an acquisition, which, no matter how well it is handled, is still likely to cause a few disruptive issues.
But what can you do to improve your workforce’s levels of engagement and boost their morale during an acquisition? Let’s find out.
1. Communication is key
In any healthy relationship – whether personal or corporate – clear and effective communication is crucial to continuing success. This is particularly true during times of upheaval, such as M&A activity. If you want staff to stick around, then you must be open and honest with them about the acquisition process and what you will be doing to support them during the transition.
Staff who feel valued and cared about are more likely to remain committed to the business, even after it changes hands. However, if communication is poor – and if they feel like their lives are being decided upon behind closed doors by faceless directors who have no real interest in the impact it will have – then, quite unsurprisingly, they are more likely to defect.
In short, consistent and effective communication is key. Make sure your management team is well-briefed and equipped to answer employee questions and concerns, keep people updated, and maintain that all-important staff morale.
2. Prioritise your team’s well-being
While the M&A process can, understandably, be stressful for company directors buying or selling a business, it’s important not to overlook the mental impact it also has on employees.
Research has revealed that a significant percentage of staff experience serious issues during mergers and acquisitions, such as rising stress levels, anxiety and depression – even suicide. To mitigate these troubling effects, it’s vital that the workforce is given support to help them maintain their equilibrium.
This could take various forms but may include counselling sessions and one-to-one chats with managers or line leaders. You might also want to invest in some team-building activities to bring new and existing staff together in a positive atmosphere that helps to make everyone feel welcome and valued.
Building social connections can work wonders for boosting employee resilience and morale.
3. Offer incentives to stay for the long haul
Incentives – both financial and otherwise – can also be a big help when it comes to boosting staff morale and helping retain talent during and after an acquisition.
When it comes to financial options, these can range from equity stakes to deferred cash bonuses or performance-related rewards.
On the other hand, you may prefer non-financial incentives, such as extra training or the opportunity to work on an exciting new project. You will probably find that being given the opportunity to expand their skills or boost their career trajectory is even more appealing than a simple monetary reward.
4. Invest in employee onboarding
If you are the acquiring company, then you may want to think about dedicating some time and effort to onboarding your newly acquired employees and making them feel welcome in their new corporate culture.
This onboarding process can include:
- One-to-one sessions
- Welcome packs
- FAQ sessions
- Staff lunches
- Team building sessions
While this can take some time, money, and energy that you may rather spend elsewhere, the truth is that this onboarding process can reap dividends in the months following your acquisition.
How a business broker can help
Because acquisitions can be so complex, with many vital elements to oversee – including maintaining staff morale and motivation – it can be beneficial to hire an expert to guide you through every stage.
For example, a business broker specialising in mergers and acquisitions can step in to oversee the entire transaction from start to finish. Crucially, they can also provide in-depth advice on how to manage the integration phase and introduce your new employees successfully into your company.
Because the M&A process can be so complicated – and because so many tend to fall short of their promise – it can be hugely helpful to have a knowledgeable and experienced business broker by your side throughout.
Harris Acquire, at your service
Here at Harris Acquire, we understand how important it is to motivate and retain top talent during and after an acquisition. If you are about to embark on this significant M&A process, we would be more than happy to advise you and support you throughout the transaction.
To find out more about our services and how we can be of assistance, don’t hesitate to give us a ring on 01926 757100 or email Hello@harrisacquire.com and a member of our friendly and experienced team will be in touch.
