Selling your organization to a new owner can be a challenging adjustment for both you and your employees. Whether you are staying on in some capacity after the acquisition or not, there are things you can do to make the shift easier for your team. It’s important for you and the new owner to understand that your employees may feel apprehensive about the changes. This apprehension could cause some to leave, especially if there is no change management strategy in place ahead of the switch.
If you want your organization to stay strong after acquisition, here are some things to know ahead of the selling process.
Three Different Types of Sales and the Effect They Have on Your Team
There are three ways you may decide to handle your own presence in your company after it is acquired. This will depend on your preferences and reasons for selling, along with the new owner’s hopes for your involvement. You may be making a full exit, you may be staying on in a reduced role, or you may be phasing out over time. Each of these arrangements impacts your team differently.
If You Exit After Acquisition
If you are exiting the company after the sale, your team may have a strong mix of emotions. If you are leaving to retire, they could feel happy for you but afraid for themselves at the same time. If you are pursuing other opportunities, they may feel like they’re being sidelined. Or, it may make them suspicious that things behind the scenes are not going well. If you run a family business, there will be additional emotions and sentiments to handle regardless of your plans after selling.
If You Stay on In a Reduced Capacity
If you are remaining part of the business’s daily affairs as a director or manager, your team’s initial reaction may be softened. They will still feel uneasy, but there will be comfort in knowing you’ll be navigating the unknown with them. You will all have to accept someone else’s big decisions. You’ll need to be prepared for the new owner to do things differently than you did in the past.
If You Phase Out or Drop Into an Advisory Role
It may be that you and the new owner decide the best plan is for you to fade out over time. This could take anywhere from a few months to a couple of years, depending on the goals and circumstances. It could also mean that you are staying on as an advisor, but will not be part of the daily operations anymore. Any version of a slower exit can help soften your team’s initial reactions to the change, but the same questions and uneasiness will remain.
What’s Change Management? Understanding How it Helps After Acquisition
Change management is the process of preparing and equipping employees to help them successfully adopt new people, systems, or standards. It is an effective way to handle the transition of ownership, as it ensures clear expectations are in place and every team member understands how the change will impact him and his role.
Essential components of a good change management strategy are consistent and open communications with the team, clear outlines of what will be changing, how quickly the change will happen, and honest explanations of how the work day will or will not adjust as a result. In any of the selling scenarios above, beginning to communicate these things to your employees will help them be prepared and make the transition with greater ease.
After acquisition and the sale’s closure, you and the new owner can build on the communication rhythms that are already in place to reassure the team. Knowing that, no matter what happens, they will be treated with respect and remain informed will go a long way in helping your employees trust the process and stay steadier in their daily tasks.
Why Change Management Should Be Part of Conversations with the Potential New Owner
One of the key considerations when transitioning to new ownership is how the change will be managed. While change can be positive, it’s important to know what plans are in place beforehand to make sure your team will be valued and considered. It’s a good sign if the new owner recognizes that a change management strategy is an important part of the transition process. It’s even better if he already has an intended plan of action when it comes to implementing changes.
If the new owner has not considered this, it could be a warning sign that he does not intend to keep your employees after the sale. Or, it could mean that he does not intend to support them through the change. You may decide you’d rather wait to find a buyer who’s a better fit for your team long-term.
If I Sell My Business What Happens to the Staff? Know the Possibilities and Accept Them
Within the fire and security industries, there are many owners who are just as worried about taking care of their teams as themselves through the sale of their businesses! These industries are tightly connected, with skill sets and close vendor relationships carrying through generations. When it’s time to sell, you may find yourself in the same scenario. As much as you may be looking forward to a well-earned retirement, you may also want to ensure you leave your team in good hands.
It’s important to understand the possibilities that follow after a merger or acquisition. Assuming the new owner intends to keep most or all of your staff, they then have their own decisions about what to do. Most may choose to stay and see what happens. Others may be let go as the new owner learns about your team and makes changes to your services or customer base. Some may leave of their own accord. This can happen if they don’t like the new owner, or if their benefits change for the worse.
At the same time, those who do stay may have exciting new opportunities to advance their careers. They may thrive under the new owner’s new energy and ideas. It can be a win-win situation for you and for them!
As you go through the selling process, you will need to accept that you can only do so much about what happens to your team after your departure. If it’s time for you to exit, then you will be hurting your team by staying. But by preparing them for the changes that are coming and making sure the new owner plans to continue your efforts to support them, you can know you did your best. Your team will recognize that as well.
An Industry Broker Can Help You Find a New Owner Who Will Value Your Team
If you’re ready to sell your business, but worried you won’t find a buyer who will support your team, consider working with an industry broker! A broker with experience in fire and security will understand your team better than others. Technicians have very different jobs than other employees, and these industries have special considerations a traditional broker won’t know how to value or navigate. A broker who understands your unique business model and team can help you find an owner who does, too.
AFS Works Exclusively with Fire and Security Business Owners: Call Us Today!
For 30 years, Acquisition and Funding Services has acted as the proud representative of fire and security businesses during their sales to new owners. Owner Rory Russell sold his own security business before starting AFS. He has a passion for advocating for owners like himself through the sales of their businesses. He knows how to speak up for the best interests of you and your team as you search for a new owner.
Fill out our confidential form here to have Rory reach out to you directly. You can also browse our Industry Insights blog for more tips on preparing your business for a successful sale.