When buying a business, many investors focus on the company’s assets, revenue history, and position in the marketplace. However, intangible assets can be just as valuable, such as the experience and expertise of the firm’s employees, who provide the client services and products upon which a successful business is built. Unfortunately, disruptive acquisitions often drive top talent away, but a few simple steps can help ease workers through the transition.
3 Tips for Retaining Employees During an Acquisition
1. Communicate Clearly & Often
More than dissatisfaction with changes in the business itself, many employees leave to avoid the uncertainty about future layoffs or eroding compensation. After buying a business, communicate with the workforce clearly and often, explaining your new vision for the company, what your business plan entails, and how this transition might benefit them. Keeping the employees updated as the acquisition progresses will help them feel as though they’re participants, rather than unwilling subjects in the change.
2. Honestly Explain Compensation Adjustments
Part of buying a business is looking for ways to increase efficiency and maximize profits, so you may choose to adjust employees’ compensation packages. Some workers will inevitably leave if you dramatically reduce their pay or benefits, but making sudden changes after promising stability will usually trigger a mass exodus of talented workers. If you plan to reduce pay or benefits, communicate these intentions to the workforce early in the process.
3. Avoid Making Sweeping Changes
Restructuring the management team, introducing new technology, and implementing new customer relations policies are normal aspects of buying a business. As beneficial as these changes may be, announcing them all at once may feel like a complete abandonment of the company culture. Incremental change may be the best approach, giving employees a sense of continuity and stability during a stressful period.
Buying a business can be an excellent investment, but it’s also a complex legal and financial process that can confuse and overwhelm even seasoned professionals. Since 1988, Zoellner Garten & Co. has connected buyers and sellers throughout Ohio, northern Kentucky, and the United States, negotiating with results and making deals happen. Visit their website for a sample of current businesses for sale, follow their Twitter for more professional insight, or call (513) 852-2400 now to speak with a member of their team.