Managing mergers

Robin Hargreaves recently coordinated the amalgamation of two practices, which inevitably had a big impact on the staff involved. As an employer, he describes what he learned from the experience

Over the past two years I have coordinated the amalgamation of our existing mixed practice with a neighbouring small animal practice, which we bought from the retiring principal. Such a move brings with it several legal and procedural requirements that, while making the financial transaction run more smoothly, can cause real problems to the people affected.

For a start, all parties were constrained by a confidentiality clause; we could tell no one outside the partnership of our plans, and the other party could give his staff no warning of the rapidly approaching upheaval. This situation pertains until the contracts are exchanged, which in our case was only about four weeks before the handover.

This situation had massive repercussions in terms of the impact on staff, particularly those in the organisation to be absorbed.

It is immediately obvious when an announcement is made that several trusted people in both organisations have been kept in the dark, and this can be deeply resented. No amount of explaining the legal background can remove the instinctive feeling that secrets mean nasty surprises.

Over the months that the legal and financial machinery has been grinding through its necessary processes you will have developed in your own mind a picture of how things will pan out. You may be, as we were, completely confident that you can make the whole better than the sum of its parts. But, try convincing people who have heard about this cataclysm 24 hours ago that their jobs will be safe and that the career they have thus far enjoyed will go on in broadly the same way as before, with the additional benefit of the improvements you have spent weeks contemplating.

Anyone who has undertaken this process will be familiar with the TUPE (Transfer of Undertakings [Protection of Employment]) regulations. Essentially, the moment you assume ownership of the business, someone who has worked for the former employer for 20 years has the same rights as if they had worked for you for the same time. New employees feel abandoned, and existing employees behave as if presented with a new, rather sullen step-family. Many times I felt like a social worker or a family counsellor.

Biggest mistake

It was my plan that, if the other practice was making reasonable profits before, then, if it carried on in the same way under our stewardship, that would continue. The existing staff could carry on in their former roles, just with a new boss. More complex integration could wait. Nothing much had to change at the outset, our new employees would grow used to us, suspicion would rapidly dissipate and all would be well.

It was at this stage that I made the single biggest mistake of the whole process. If this article has a theme it is to prevent anyone being as naïve as I was in handling a body of people in such a heightened emotional state. I said: ‘Don’t worry, we are not going to change anything.’ During such a complicated process there are so many variables, and every day there were small changes that had to be implemented. Having nailed my colours so vividly to the mast, I was vulnerable at every turn to having my words repeated back to me. We had simply not been able to predict all that would have to be adjusted, and so to our new employees we were untrustworthy.

What I should have said was that inevitably we were going to change just about everything to some degree, but it would have a positive effect on everyone in the long run.

Integration

It has taken two years to integrate our teams fully; there have been many tears on the way, and three people could not be brought along and were lost in the process. This past Christmas it was fabulous to see all the staff partying up a storm together.

Even now, there are some subtle issues that arise, with necessary changes to former working practices. All along, when you want to adjust some longstanding processes, it is hard for it not to be seen as a criticism of the people who set up the original protocols.

This year we have completely overhauled and renewed our practice management system. This was something that ran the risk of upsetting all our staff; everyone’s lives were going to be more difficult and challenging, at least for a while.

However, this process, while not going without a hitch, has been fully supported by staff at every level, and according to our IT provider has been the smoothest changeover it has ever had.

Our practice manager and I have discussed why this might be, and the conclusion seems to be that everyone was kept fully involved with the planning, had been consulted about how it would affect them, were onside before the disruption began, and there were no surprises.

This article aims to illustrate some of the reasons why certain aspects of our practice amalgamation were so painful. I don’t know how to completely surmount these problems, especially as the most vulnerable people are those being taken over. In such situations, the previous employer has no vested interest in making your life any easier by better preparing his or her staff.

If I were in the same position again, I would insist that everyone had at least some idea of what was in store, and why it was necessary. I feel that there must be a way to achieve this while maintaining a necessary level of confidentiality about the details.

‘Employment law – rights and responsibilities’, is the subject of a one-day interactive business course being held at the BVA on May 4. The speakers are from the BVA’s Mediation and Representation Services, and the course is aimed at those who employ and manage staff. Details are available at www.bva.co.uk/events