When making an acquisition and onboarding a target’s workforce, your Human Capital Management (HCM) practices and processes can make or break the deal. Before you close any transaction, make sure the right policies and procedures are in place. You’ll see it can make all the difference.
As you seal the deal, here are four key HCM trends to look out for:
1. Suitable Compensation and Complete Transparency
The challenge of aligning roles and salaries from the acquired company with your current standards can be quite the headache. You don’t want to undervalue your new employees; yet, you also don’t want to overcompensate them. A proven approach to tackling this situation is to first examine your internal compensation, performance evaluation, and promotional practices (applicable to all staff: old and new). Think transparent, fair, and equal thoughts. Don’t know where to start? Trained HR professionals are skilled in implementing transparent salary banding or frameworks to overcome imbalances in compensation.
2. A Fight for Your Talent
Savvy competitors will notice your acquisition and look to the acquired company’s talent supply. If they can offer higher compensation, better benefits, and more opportunities, your new employees may jump ship. Good talent, and especially great talent, is hard to get but even harder to keep. Make sure your new staff knows you appreciate them and show your commitment to retention.
This begins with a strong organizational culture (demonstrate this on day one and never stop). Next, ensure your benefit offerings are up to market. If you’ve got some wiggle room, enhance those benefit packages with further incentives, like equity ownership or a phantom stock plan, or more intangible benefits, like a firm wellness plan or half-days before holidays. Aligning the interests of your employees and your investment can go a long way! Lastly, keep in mind, an acquisition can be stressful to employees. Orientation and coming up with other creative ways to engage newly acquired employees can go a long way to easing the transition.
3. An Emphasis on Data Privacy During Data Integration
When you acquire a company, you also acquire their data practices, HRIS, CRM, and ERP systems. While you might eventually integrate their infrastructure into your environment, you’re still going to face the issue of data breaches. Basic steps, such as ensuring employee records and any personally identifiable information (PII) is locked down, will get you through the mud at the onset of an acquisition. After that, we suggest leaving the nitty-gritty to the cybersecurity professionals.
4. Be Prepared to Leverage Technology
Technology is constantly evolving and who knows where we’ll be in 5, 10, or 15+ years (still waiting on jetpacks) – that’s why it’s vital to understand the role that technology will play in your investment, and specifically in your interactions with your workforce. We expect technology to progress rapidly, with advancements such as artificial intelligence making their way into your everyday operations. Here’s where you and your team of leaders come in: have a firm understanding of the strategic direction of your organization and if you’re equipped to handle a technological overhaul (or technological mini-haul…we can start small!). Then, examine your potential acquisitions and make sure they’re just as capable.
Our team is here to help every step of the way—including the steps leading up to a potential acquisition. Don’t go at this alone, lean on our team and feel confident in making that investment – or in passing on one. Contact us, we’d love to talk.