COMMUNICATIONS

Uncertainty and disruption are your biggest enemies after the purchase, and effective communication is your best tool with which to fight these. Part of your plan should be a communications strategy, both internal and external, covering everything from the announcement of the deal and what it means, to your plans for moving the business forward and developing it.

Think of this as both a selling document to your staff and customers designed to maintain and develop confidence in you and the business going forwards; as well as a template that sets out the path that the business is going to take which puts the changes you are planning into context.

To design your approach to communication you need to understand:

• who you are communicating with – which will include both employees inside the business and people outside the business, principally your customers and suppliers
• what you are trying to achieve by communicating with them-which is generally to obtain support for the changes you are planning to make and to reduce any potential damage to the business by removing uncertainty
• what you need to do to communicate effectively – which is to understand what it is that the people you are communicating with will want to know, and provide them with a meaningful answer.

The groups of relevant people and the sorts of issues that they are likely to be concerned about include:

• Employees – who will want to know what’s happening about jobs, who’s going to be in charge of their department, when they will know about changes in procedures, what the plans mean in respect of the projects they are working on.
• Customers -who will be concerned as to whether quality will be maintained, whether they will still have the same point of contact, what will happen to prices, whether the new products in the pipeline will continue to be developed.
• Suppliers -who will be asking whether you will continue to use the existing suppliers, whether you will look to renegotiate prices, whether they can rely on being paid, on time.

It follows from this that you can easily adopt a systematic and structured approach by using a pre-prepared ‘Q & A grid’. To do so, identify all the interested parties across the top of a sheet in as much detail as you think you will need. Then you should think up all the basic, rude, blunt questions that any of them might want to know and list these down the left. This provides you with a grid to fill in where each box will require an answer that can be communicated to the relevant parties.

In each case you should consider carefully the best medium for the message you want to put across to a particular audience, as the means by which people are provided with information can significantly affect the way they react to it. For example, if the plans unfortunately call for the closure of a factory this needs to

be communicated to those employees by way of a face-to-face meeting rather than announced as a press release to local media.

However, once the news is out, as a general rule you should put the answer out as widely as possible. It doesn’t matter if someone hears it three times, as long as everybody that needs to hears it at least once.

This approach ensures that as far as possible you have a consistent and coherent message on any topic.

Of course this grid will never cover every question that you may be asked and there may be boxes in the grid for which you do not initially have an answer. The rule then must be to answer these questions as honestly and openly as possible whilst avoiding giving hostages to fortune or over-promising what can be delivered, which will undermine your future credibility. If you don’t know the answer to a question you should say so, but try to give an indication of when you will know.

Communicating with staff

The two absolutely critical groups are your staff and customers, and your communications process usually starts immediately on completion by holding a meeting with the staff. At this the old owner is likely to want to introduce you to announce that the sale has taken place. Having the old owner do so can help to reassure staff; and do not forget that as a result of the need to maintain confidentiality many of them will either not know of it at all or only recently have found out as part of the process of completion, which may have come as a shock.

You should have a positive message ready for this meeting to maintain enthusiasm, and having worked through your communications matrix be able to deal with any questions that arise or give a timetable for when things will be made clear.

There will often be questions about the likelihood of changes or redundancies, as a prime concern of employees will be whether any of them will lose their jobs. The rule here is as far as possible not to give hostages to fortune. The honest answer is often that:

• once you have taken over, yes, there are likely to be changes and you can never give any guarantees of jobs, but
• you have bought the business because it is successful and it has been so because of the way staff keep the customers satisfied
• to keep the business successful you will want to keep the customers happy and keep the staff who do so
• therefore, the best way to keep the business successful and to keep jobs secure is to continue to provide customers with excellent service.

If this is a succession sale within a family firm, you can emphasise that the sale has ensured there will be continuity in the business going forwards, which will therefore help safeguard jobs.

In addition to any general meeting, you will also need to meet the key players within the management individually as soon as possible post sale and confirm to them personally their importance to you in order to make sure you retain them.

It is a very natural reaction to focus the majority of your initial effort on communicating with the employees. This is because being inside the business they are very visible to you as the new owner and therefore the impact of any problems or issues can be very apparent to you. You will also rightly have a perception that your employees are a key channel for getting the message across to the customers as they represent the business to them. However, simply relying upon your communication with the employees to filter through in a secondhand way to the customer base is asking for trouble.

Communicating with customers

Your customers are the lifeblood of your business and your new competitors will be talking to them direct to suggest that the business sale and the changes that this will mean for the business are likely to have an adverse impact on the quality of service they are receiving (about which they may well be right as there is inevitably some risk of disruption). And if any disruption is prolonged, the people working for your competitors who are doing the talking to your customers may well be your own ex-sales people who are looking to take their relationships with them. It is therefore vital that you have a direct communications campaign to your customers to explain what has happened to the business and to ensure that you retain them through any changeover period.

You should arrange visits to each of your top customers as quickly as possible after the sale (or if at all possible before) so that ideally you can be speaking to them before knowledge of the transaction leaks into the marketplace and competitors start their attempts to poach.

You should ask the existing business owner to set up a series of meetings with the top customers, preferably over the first week or so, in order that they can introduce you to them. You can then make your pitch, which is usually based around the message of ‘business as usual’. This also gives you an opportunity to open a direct dialogue with customers over any concerns they may have regarding issues that you may need to prioritise in your plan, as well establishing a new direct personal contact as quickly as possible.

Communicating with other stakeholders

Going forwards you should try to obtain good sources of information as to what questions all the main groups of people with any interest in the business (or ‘stakeholders’) are asking. This list ranges from shareholders, directors, managers and employees, through to suppliers, bankers, landlords, local authorities, customers and in some cases the general public.

Each group will have their own interests and issues of concern in the business that may have to be dealt with. So you should meet with suppliers and customers on a regular basis and encourage a dialogue with staff, possibly by using focus groups if the business has a large number of employees. And when you identify a question that is causing people problems, you should deal with it quickly.

Try also to identify the key opinion formers within each group. It may quickly become obvious, for example, which employees are the ones that the rest listen to; and so for your message to be effective, you need to ensure that these individuals are convinced. You should also ensure that your middle managers are brought into the process and used as effectively as possible to communicate to the workforce, as they will usually be seen as the normal channel through which such information is officially distributed to employees.

Your communication with all stakeholders needs to be both full and frank and an ongoing process. It is likely, for example, that any plans you have for the business will change over time. To maintain your credibility with the stakeholders you will therefore need to communicate actively how your plan is progressing, as well as the reasons for any changes to the plan in an open and ongoing way.