Ready to sell your agency, but worried about losing your employees? Learn from three agencies who are acquisition experts to find out exactly how to break the news, navigate the transition process, and what they wish they had known along the way.
News flash: your employees are scared of change. To make matters worse, while all of us have at some point experienced anxiety, depression, or fear of the unknown in the workplace, these levels have risen by 25% since 2020 and aren’t slowing down anytime soon.
This is a daunting time for home care providers seeking to announce a company-wide change as big as a new acquisition—which is why you can’t afford to wing it! If you want your employees to embrace change and stay with your agency through a transition, you’re going to need a carefully planned strategy.
Which is why we’ve called on the experts from HomeCare of the Rockies a Family Tree Company, Family Tree In-Home Care, TeamElderCare Consulting LLC, and Arosa to share the strategies they used to retain employees during their own company mergers and acquisitions.
Head into your acquisition armed with these proven strategies so you can say hello to the future without bidding farewell to your employees.
Breaking down how to break the news
Introducing organizational changes
Addressing common fears and concerns
Your role post-acquisition
Breaking Down How to Break the News
Although you have some breaking news to share with your employees, successful mergers begin when there is no news to “break” at all—only new opportunities and possibilities to build.
Ari Medoff, CEO of Arosa, suggests framing your merger or acquisition as an opportunity for employees to gain new opportunities they wouldn’t have without the upcoming change:
“Generally, we find that employees from our newly acquired companies quickly understand we are a mission-driven organization with deeply rooted core values. This resonates with them and many quickly see that joining a larger, growing company presents new, previously unavailable, career opportunities.”
Follow this strategic communication process to deliver the news in a way that motivates your employees to grow with you and be excited about the new opportunities that await them:
1. Communicate your vision with your employees well before acquisition time to build a solid foundation of trust.
Sandi McCann, Founder of HomeCare of the Rockies a Family Tree Company, cautioned that your vision to expand and grow shouldn’t come as a surprise to your employees:
“With HomeCare of the Rockies, everyone on our team—leadership, office support staff and caregivers, even our referral community, understood that we wanted to expand and grow as part of our purpose. Because we had been communicating this message with them over the years prior to our decision to be acquired, and employees had clarity on our purpose (to provide exceptional care support for older adults and advocate for better and higher paying jobs for caregivers), it made “breaking the news” more of a “great news” message. We were simply right in line with our plans: to expand and grow.”
As you’re getting ready to be acquired, consider postponing sharing the big news until your employees have had adequate time to understand their importance within your organization—an easier task than you may think for agencies who already treat their employees like priceless assets rather than replaceable commodities.
2. Make sure both companies are on the same page by creating a communication plan.
Without establishing clear communication and expectations between both companies, your acquisition announcement will send an automatic alert to your employees that the foundation of your company is cracking. Ensuring all parties involved agree on the same action plan, before announcing the news, will unify the messaging you present to your employees.
Tim Murray, CEO of TeamElderCare Consulting LLC, suggests that the buyer and seller sit down together to answer the following questions before any announcements:
Confirm merger details:
How will the company be integrated into the buyer’s company?
Who will run the new company?
What roles (if any) will the previous owners have post–acquisition?
When do you tell your most valuable referral partners?
When do you tell your office staff?
When do you tell your caregivers and clients?
Plan communication content:
Write out what you will say to your office staff.
Write out the email you will send to your caregivers.
Write out the email/letter you will send or communicate to your clients.
3. Share the news according to your organization’s chain of command to ensure the correct people hear the news first and prevent rumors.
Now that you’re ready to share the good news, who do you tell first? Use your company’s organizational chart or chain of command to prevent rumors from spreading before you can tell each department in person.
McCann breaks down the communication process she used to make everyone feel positive about the upcoming changes and leave her employees with a clear sense of direction:
“Once the overarching tone was established, we created our initial messaging and communications through multiple channels: in-person, virtual townhall meetings, email and letters. We began first with our leadership team, then with our office team. From there we reached out to caregivers and clients (simultaneously), then to our referral community.
(Note: To take a closer look at the image above, right-click to “open in new tab.”)
Daniel Gottschalk, Co-Founder of Family Tree In-Home Care, added that, as you communicate to stakeholders, you need to focus on how the transition will affect them. Make sure your staff and clients aren’t left with anxieties about how the change will affect things like pay rates, bill rates, benefits, retention of the team, and opportunities for advancement and training.
It’s also important to not only plan who you will tell, but how you will tell them:
“In the week prior to the acquisition going live, we met with 100% of our employees through in-person orientation over several sessions to fit everyone’s schedules. They were highly organized, professional, upbeat and friendly, with packets and slides for employees to review, walking them through every step. We provided fun “take-a-ways” with more talking points and fun snacks.”
Although everyone’s company culture is different, you’ll want to make sure you take the time to tell everyone the big news in-person. Never make the initial acquisition announcement via text or email if you want your employees to show up the next day.
4. Strategize the perfect time to tell everyone.
Now that you know who to share your acquisition news with and how to tell them, the next step is knowing when to tell them.
Gottschalk outlines the ideal time to tell your employees about an acquisition to get them excited about continuing their employment with your company:
“We once announced a deal 6 weeks prior to closing and before we could even get to know and work with the team, they had nearly all quit. Telling staff about a deal too soon can result in the seller’s lawyers feeling too exposed and the employees left with too many weeks to imagine the worst-case scenario.
“On the flip side, communicating too late will erode trust with the team. We believe the sweet spot lies somewhere in the middle, and on average, we first communicate with office staff 3-4 weeks prior to the closing date. Caregiver and client communication usually comes 2 weeks prior to closing.”
Introducing Organizational Changes
Once you’ve announced the change, your job is to make your company’s impending transition as least intimidating as possible.
Medoff explained that it is best not to disguise the changes that are about to be made, but rather make a plan for your employees to embrace them:
“Never say ‘nothing is going to change’—of course things will change! You don’t want to lose credibility by telling folks what you think they want to hear but you also can’t afford to change everything all at once. So getting the messaging right about the pace of change and then following through on that plan is key.”
Pace the organizational changes happening in your company by dividing what you need to do before, during, and after acquisition according to McCann, Gottschalk, and Murray:
Establish a positive work environment and company culture to begin with—before making any changes.
Request a point-of-contact from the acquiring company or an integration project leader who can manage all the steps and any issues that arise during integration.
Ensure the acquired owner is positive, authentic, transparent, and outwardly embraces the change for employees to see.
Tailor all communication with a healthy understanding of your employees’ expected fears and concerns.
Prepare your office staff with a list of questions and answers so the whole team can address concerns with a unifying language.
Introduce changes as slowly as possible.
Be there in the office with your door open as much as possible so that you can easily communicate with your employees and keep a pulse on company morale during the transition process.
Quickly identify leaders and influencers in the company who can serve as your ally and get them involved in any issues that arise. Their buy-in will influence and support the rest of the team to collaborate through proposed changes.
Maintain business as usual by keeping employees focused on delivering exceptional care to your clients.
Continually reassure your employees and coach them through any friction that arises from the transition process of bringing two teams together.
Hold an event for the team where the buyer can introduce themselves, share their background, and reassure your staff.
Develop a post-acquisition organizational chart with the buyer to clearly communicate the change to employees. They’ll want to know their role after the company is acquired, who they report to, and key people in departments like HR and payroll.
Develop a transition plan outlining the steps for integration of various systems and processes of your company.
Implement organizational changes in bite-sized pieces to make the acquisition easier to swallow for your employees.
Addressing Common Fears and Concerns
We know that employees fear change in the workplace, but what do your employees worry about when it comes to acquisitions?
Keeping your employees’ concerns top of mind will help you prepare for the types of push back you can expect to face:
Job stability/fear of losing job
Changing job responsibilities
Feeling less competent while learning new systems, policies, and procedures
Preferred work schedule changing
Changes in PTO, pay, and benefits
New management’s expectations
Company’s financial stability
Transitioning from a smaller business to a bigger corporation
While the goal is to hand the reins over to new leadership, you can help the transition process be a smooth one for your employees. Document and communicate employee concerns to the new management to show your employees that you trust the new company, and so can they. You’ll also want to make sure your employees are absolutely clear on who they can contact for questions and comments when you are gone, if you will be leaving the company.
Be a part of the transition process for at least four months to show that you believe in the importance of helping employees adjust to their new work environment.
Your Role Post-Acquisition
You’ve sold your company—now what? While your agency is no longer yours, you are still a major influence on your past employees. Although you no longer own your company, your greatest role has just begun.
Murray explains that previous owners need to make the transition from agency owner to advocate and describes exactly how to do that:
“First, recognize that once you sell, it is not your business and you do not make the decisions anymore. Be careful about committing something you now have no control or authority. Remember, it is not your baby anymore.
“Second, if you are still part of the company as a consultant, your role is to be an advocate. If your ex-employee has a concern, listen to the concern, and bring this concern to new leadership. New leadership will fully recognize employees will need some time to assimilate to new ownership and will have concerns.
“Third, be proactive in helping the new leadership during the integration process, documenting and communicating suggestions, to make the process as smooth as possible while also helping your ex-employees feel more comfortable.”
Make sure that your employees, partners, and even you understand your role post-acquisition. Your employees need to see you believe in their new management and also know that you’re going to help take care of them until they can trust that.
Murray consulted for four months to help smooth the transition process and hire their leadership replacements. This practice helps show your employees that you didn’t leave before personally ensuring they were in good hands.
Passing on Your Commitment to Quality
There is only one way to truly keep your employees after an acquisition: keep putting them first. You can keep your legacy alive by ensuring your caregivers are taken care of for years to come.
Make it a non-negotiable that your buyer continues checking the pulse of their caregivers. Be known as the founder who took care of their employees even after they were gone and welcome this practice into your newest adventure.
Unsure if it’s the right time for you to sell? Check out our most popular episode of Vision: The Care Leaders’ Podcast to learn the game plan every executive needs to prepare their business for a future buy/sell.