28 Aug Communicating with Employees During an Ownership Transition
There is no denying that it can be awkward and sometimes problematic for company owners to tell their employees that they are selling. When it comes to planning a successful ownership transition, you’ll need to develop a coherent strategy and be ready to implement that strategy from day one. Experienced M&A advisors can help you develop and execute the strategy.
Key Employees Should Know Your Plan
You never want employees to be nervous or confused. Nervous and confused people simply don’t do their best work. Or even worse, they can rebel, quit, take a job with your competition or even start up a competitor of their own.
There is a way to eliminate employee confusion and help to ensure an effective transition – through honest and clear communication. Make certain that you tell essential employees what your plans are both in the short term and the long term. Be transparent.
Remember these key employees will learn that you are selling before other employees know, so you want them on your side to assist with the transition. Of course, you’ll want to be certain that these key employees keep this information confidential until after the sale. Achieving this goal may mean outlining to these key employees how they will benefit from the change in ownership.
Always Provide Clear and Positive Messaging
You want to tell all of your employees that the sale has been finalized, preferably in person, as soon as possible. The sooner employees know that a big leadership change is coming the better. They will have more time to adjust to the change.
Pay attention to your messaging and make sure it is on target. Be clear and honest with your employees about your motivation for selling as this will help create a more positive climate for the transition. If you understand how their jobs will be affected, then share this information with them as well. Again, transparency is usually the wisest course of action in this situation. “Surprises” could boil over into resentment and even overreactions.
While transparency is key, it is also essential that you remain positive and upbeat about the transition and the new ownership. Steer employees away from seeing the sale of the company as a negative event. Finally, help employees meet and get to know the new owner and his or her strategy. This simple step will also go a long way to reduce friction.
Every transition is different. That is why working closely with proven M&A advisors is a prudent move. The right advisors can teach you how to streamline the ownership transition process and help you avoid costly mistakes.
SIGN UP TO RECEIVE NEWS & UPDATES
M&A and Growth Strategies for Tech, Healthcare, and Others