A Management Buyout (MBO) provides a fantastic opportunity to acquire the ownership of a company’s equity, and it creates an entrepreneurial environment with huge rewards both financially and personally.
Whilst there are many factors the management team needs to concentrate on during this process – such as financial, operational and risk management – handling disclosure to employees is essential in maintaining their goodwill and collaboration.
“It is far better for staff to learn directly from their managers via HR than though rumours about what, how and when the change of ownership (and what it means for them) is going to happen”, explains HR expert Charlotte Gallagher of P3 People Management, based in Hale.
“The human resources department is ideally placed to liaise clearly and consistently between managers and employees. If fear and lack of clarity over job security, contracts, and future role responsibilities are removed, productivity is more likely to remain at current levels”, she continues.
For a business undergoing a change in ownership, it’s easy to see how managers could be tempted to focus solely on the finances and strategy of the takeover rather than the ongoing concerns of the business and its staff.
Charlotte concludes “Human resources can communicate the timeline of changes and keep employees up to date with developments, along with explaining the restructure of personnel and who staff report to on an interim basis and in the future. They will be involved in discussions and the rewriting of work contracts, job descriptions and perks/benefits, and ensuring everyone understands their role in the ‘Newco’”.
HR Aspects Magazine would like to thank Charlotte Gallagher for her contribution to this article.
If you need help and advice for your HR department during an MBO, merger or acquisition, MBO specialist Charlotte Gallagher at P3 People Management has the experience and skills to help.
