This is a fundamental question that I come up against when speaking with business owners. A business owner can be selling a company for a variety of reasons; retirement, family time, overworked, overstressed, more holidays, time, freedom, ill health, recent scare, tiredness or whatever it may be, the one thing they want is their teams looked after.
We are a funny bunch of moral pioneers in the world, of course the world wants to put entrepreneurs into a category of greedy, rich, business owner but truly we are individuals alongside our teams that help the world go round, and we always will be.
However, this is a common question that I speak to owners about quite often, my answer is always the same.
The definition of Business is a ‘commercially profitable, financial enterprise that works without you.’
Provided that this is the case, why would I look to fire the team that has helped to create that. In an ideal world (but not always) we want to buy a business that can either morph into one of the other businesses or have a management team in place to run the day-to-day business, if there is no management team in place, then I would personally be looking to promote from within rather than externally.
For two reasons, firstly it is less costly than paying recruitment fees and secondly you want someone who understands the business, such as the culture of the company and has been around a while to know how things operate from their standpoint.
This is the ideal scenario.
The last thing a buyer who is buying your company wants to do is buy himself a job. With other businesses in the background, nobody wants to buy a company where we must get involved in office politics, or replace the toilet paper after it has run out, or dealing with the difficulties and ever-increasing difficulties of HR.
As the owner and new buyer of your business there will be a transition period where you can help facilitate what happens, the culture, the vision, the mission, etc but also to help the new buyer put the pieces to the jigsaw in place and operate the company from a higher level and allowing the management team to do what they do best, which is manage the day to day aspect of the business.
Will we change the business?
Sitting down writing this, the truthful answer is ‘I hope we don’t need to.’ If you are buying a good, profitable company that works without or nearly works without the owner minus a few tweaks such as a promotion or employment, then why would a new owner change a winning formula?
Firstly, it upsets the team. Human beings by nature do not like change and depending on the sector too, there is usually certain personalities within each sector that do not like change. To give you an example, try changing a lawyer’s day to day and you will soon scare the team and have a few complaints as the personality type who conducts this job role is used to coming to work and certain time with certain systems on a day-to-day basis.
If a company that you have built is in profit, working well and the machine works correctly, a new buyer should only really need to oil the machine and grease the wheels slightly to make it run better, but that doesn’t mean that the team should notice the change, nor would a new buyer want the stress of changing the company drastically unless it needed it. If it needed that, then it probably wouldn’t be a very good company to buy.
In a quick conclusion, the answer is a firm ‘no.’ Why would a new buyer need to change the company if he is buying a good company in the first place that turns over a consistent revenue and makes a good or adequate profit for that sector that it operates in.
What happens to the company culture after the acquisition?
Business owners often pour their heart and soul into creating a unique company culture that aligns with their values and vision. When considering selling their business, many are concerned about preserving this culture they’ve carefully cultivated over the years. Here’s how we approach this important aspect of a business acquisition:
Preserving the Core & Stimulating Progress
At SJ Acquisitions, we understand that a company’s culture is its lifeblood. It’s what drives employee engagement, customer satisfaction, and ultimately, business success. Our approach is to preserve the core elements of the existing culture while stimulating progress where necessary.
Cultural Due Diligence
Before any acquisition, we conduct thorough cultural due diligence. This involves:
- Understanding the company’s values and mission
- Assessing employee satisfaction and engagement
- Analysing communication patterns and decision-making processes
- Identifying key cultural drivers and rituals
This process allows us to gain a deep understanding of what makes the company tick and what elements are crucial to its success.
Retaining Cultural Ambassadors
We believe that the best custodians of a company’s culture are often those who have been instrumental in shaping it. That’s why we make a concerted effort to retain key employees who embody the company’s values and can help maintain cultural continuity during and after the transition.
Gradual Evolution, Not Revolution
While we may introduce new ideas or practices to enhance the business, we do so with respect for the existing culture. Any changes are implemented gradually and with clear communication to all stakeholders. Our goal is to build upon the strong foundation that already exists, not to tear it down and start anew.
Open Communication
Transparency is key during any transition. We maintain open lines of communication with all employees, addressing concerns and soliciting feedback. This helps to alleviate anxiety and ensures that everyone feels heard and valued during the process.
Celebrating Successes and Traditions
We recognise the importance of maintaining company traditions and celebrating successes in ways that are familiar and meaningful to the team. Whether it’s annual events, reward schemes, health benefits or insurance, we wouldn’t be looking to change this and upset anybody over something so minor.
Balancing Old and New
While preserving the essence of the existing culture, we also look for opportunities to introduce positive elements from our other successful ventures. This careful blending can often lead to an even stronger company
Conclusion
I personally believe that a company’s culture is one of its most valuable assets. My commitment would be to honor and preserve the unique cultural elements that have contributed to the company’s success while carefully nurturing its growth and evolution. It is by far a very important question during the transition process and any good buyer should be asking this question at the outset prior to due diligence.
