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Aug 30, 201812:12 PMExit Stage Right

with Martha Sullivan

What happens after the champagne is popped? Part 2

(page 1 of 2)

In my last blog post, we started the conversation about what happens once you set the champagne glass down after purchasing a company. You have your shiny new company and the keys to the door are in your hand. Now what?

The first few days and weeks as the new owner of a business sets the tone for all your relationships with your new employees, customers, and vendors. Your community and industry players are also watching. What you say, how you say it, and how you act will leave a lasting impression.

You want to put your best foot forward with a thoughtful and well-considered communication plan.

Employees

The day the asset deal closes, you are hiring new employees. Real people with families, commitments, and aspirations. People who are going to be afraid, no matter how good your intentions and plans for continuity are. How you handle yourself and the company in these early days is crucial. You can’t underestimate the importance of doing this part well.

Communications need to be carefully planned and coordinated, including the:

  • Announcement of the transaction;
  • Introduction of your new vision for the company;
  • What opportunities the new ownership legitimately offers employees; and
  • What changes you do intend to make and when.

Your “hiring” process needs to be handled well, too.

  • Will everyone be hired?
  • Will those hired remain in their same position? Will you be changing their job at all right out of the gate?
  • What compensation is being offered? Their current rate of pay or something different?
  • Will “stay bonuses” be offered? If yes, how much and under what conditions?
  • Who is going to meet with individuals and talk through whether a position is being offered?
  • Who is going to help employees complete all the necessary paperwork and ensure that benefit enrollments go as planned?

As discussed in the last post, there are many facets to the new hire processes. We encourage our buyers to put together a hiring packet for each employee that includes an offer letter, a position description, an updated employee handbook, and other materials that may help expand the communication. Draft position descriptions go a long way for setting the stage for a second one-on-one conversation with each hired employee to discuss what changes or corrections might be made and, more importantly, get to know the individual and where they feel they can contribute. Begin and continue your conversations with your employees.

Realistically, you may not plan to offer a position to all of the employees. Think through how you want to handle the conversations with the people who are not being offered a position, down to the smallest detail. Who will meet with them, what’s the script, what resources will be provided, if any, to help cushion the blow, and how will they be allowed to collect their belongings and leave the premises? This is hard for all involved. The “survivors” will be watching and noting whether this is done in a professional and thoughtful manner. Prepare for your conversations with the survivors, as well.

(Continued)

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About This Blog

Spending half her career as an advisor to privately-held and family businesses and the other half in CFO/COO roles, Martha Sullivan is a partner and the succession planning practice leader in the business transition strategies group at Honkamp, Krueger & Co., P.C. She and her team have extensive experience assisting business owners achieve their personal, business, and transition goals. “Don’t think of the 'exit' from your business like it’s a four-letter word. Make it your next adventure!”

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