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A lot of talent is lost right around the time of deal announcement much prior to creating a resource retention plan. What practices have you seen deployed by companies to retain talent?
Very true, Surabhi. A possible tactic might be to include verbiage within the initial announcement alluding to a plan to retain talent. This way, NewCo employees have hope of a future with the acquiring company. Having HR involved in the very beginning can help craft this message. Many times the acquiring company concentrates only on the financial aspect of the acquisition.
Some company have some great retention programs, it can be limited in scope unless the company have the foundation in a place like the culture of the company
People spend 1/3rd of their waking life at work. the company need to make them feel exhilarated, motivated, and know that they are adding value in what they do every single day. The culture embodies hiring great people at all levels, having career options, being recognized and rewarded, understanding what is expected of them and for the company to really listen to their feedback.The best retention program for a company is a culture that unites, engages, and inspires its employees. If that is not in place, then what value would a formal retention program bring to your company? Develop a culture that brings out the best in people, not people that just come to work for the paycheck.”
Our focus clearly lies in nurturing a unique culture that attracts and retains great people.
I like Dawn idea on communication in the beginning and wanting to retain the talent. Have conversations from the start on how you are going to help the employees achieve their goals and hit targets for success. Employees want to be valued. Maybe individual meetings with key employees will be key to success to maintain the best employees.
You can only retain talent by communicating (correctly) and making the talent believe that there will be opportunities in the merger organisation. Including HR Business Partners clearly makes sense. In one of the deal I witnessed informal communication with the new org leaders/Line mangers helped more than HR.
You may consider the use of stock options or ESOPs to retain key talent.
I agree, top talent wants to feel like they are part of successful team with opportunity for career growth. The faster you can engage the identified key resources in projects outside of just integration work, the faster they will embrace their new organization.
When we did an acquisition a few years back, we were lucky to not lose any talent in the process. Right from the beginning, we made sure our message was clear and during presentations both our company and the key leadership of the acquired company was involved and remained positive during the process. We made sure to travel and meet with staff in-person, roll them into our benefits that would improve their overall compensation (we are an ESOP and extended a SERP option to them), as well as ongoing support and joint meetings. The message was that we were here to support them and support their continued success.
I think good continuous communication would help. giving clarity about their role and future growth will help a lot to bring down the anxiety/insecurity among the talents. of course announcing upfront financial benefits also help.
I agree with these posts that communication is key along with method and timing of the communication. If the communication is not done early enough, you lose people. Another thought, it is common when we talk about retaining top talent we tend to think about the leaders, those aspiring to “move-up” and yet we should also be cognizant of those that have the knowledge and experience, trained on the systems and are huge assets to their teams but tend to fly under the radar and are also at risk of fleeing if companies don’t recognize their value.
During the due diligence process, our team would get a feel for who the key staff members are. We’d get comments like “he/she’s a keeper.” In those instances, there are retention bonuses that are offered to keep the person for the short to mid term. After that, normal efforts such as salary adjustments, future growth opportunities, and educational opportunities are discussed. Also, probably the most important thing that we do is to develop relationships with those key staff members. When people feel like they are part of the team and valued, they are more likely to stay.
– Create clarity and communicate as frequently as possible. Be transparent
– Make sure people feel they have job security. Set clear goals, measure the performance, provide constructive feedback
– Make sure the compensation and incentives is as competitive as possible
– Make sure the career and growth path is clearI believe both buyer and seller must be aligned as far as culture is concerned. One of the main factors in retention.
A merger or acquisition will always put a strain on talent retention. That being said, the keys to retaining remain the same. Make people feel valued, work to minimize uncertainty, communicate the why of change constantly, and ensure people feel well compensated.
Similar to what others have said, it is vital to understand who the key employees are to be retained at the top of the organization (as they have a significant amount of influence on Target company employee retention) & immediately do two things: (1) Have these leaders serve on the Integration Team; and (2) Establish Retention Bonus plans for these individuals. For the broader employee population, clear & frequent communication from the top is essential. Town Halls & email updates are good ways to do this. Finally, it is critical that the Acquiring company’s senior leadership set some key ground rules for the integration work, including “rules of engagement” when deciding what people, processes, and technology to adopt. For example, does the Acquirer retain all existing processes or technology? Or does evaluation occur & if it is found that the Target company’s processes or technology are better, the decision is made to adopt theirs?
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