Is your organisation acquisition ready?

The pace and intensity of HR activity related to merger and acquisition is well-known and yet many organisations do not take time up front to plan for these events, even when the business strategy has expansion as an explicit goal.

By supporting the development of an HR Acquisition Readiness Plan, 3XO helps our clients be ‘acquisition ready’, ensuring that, ahead of any move to expand, thought has been given to the people and HR aspects of the different phases of acquisition, including: due diligence, execution and post-acquisition integration. This means our clients are better placed to move effectively and at pace when the right opportunity arises: they are also more likely to have considered and mitigated associated risks.

Our practitioner-led approach

Our experienced team works alongside our clients as they develop their thinking on the people-related aspects of acquisition and growth strategy. Our collaborative, outputs-focused approach is cost effective and leads to outcomes built to last.

HR Acquisition Readiness Plan

Working with us to develop their HR Acquisition Readiness Plan, we help our clients articulate the criteria they consider important to informing their HR approach any acquisition. These areas include:

Operating model

Which parts of the current operating model are scalable? To what extent, and in what ways, will there be a company ‘way’ which acquired businesses will need to follow? What is the minimum that is needed? What is non-negotiable?

Incentives and rewards

What is the preferred approach to incentivising and locking in the key team members in the acquired business? What are the implications for reward and incentives, and performance management, of the existing team as they deliver this critical part of the strategy?

Capabilities

Are there specific capabilities that the organisation is seeking to acquire as part of this programme? How can acquired capabilities be leveraged and integrated to improve existing teams?

Organisation design

Is the intention to standardise processes within the acquired businesses? Will processes be centralised, realising synergy savings but possibly requiring more resource in the centre?

Is the HR team ready?

Once we have worked with clients to complete the HR Acquisition Readiness Plan, we recommend that consideration is given to the capabilities of the current HR team to deliver against the areas identified. This may be a matter of limited resources or skills and capability gaps.

In particular, it is crucial to recognise that, alongside any acquisition or merger programme, HR teams will likely have to maintain high levels of service in relation to \’business-as-usual\’ operations as well as the delivery of other significant projects.

Thinking about how teams should be resourced to deliver the challenges of such significant change activity, including areas where additional, temporary or expert support from outside the organisation might be needed, is key to ensuring successful implementation of any acquisition plan.

A prudent investment

In our experience, the exercise of preparing an HR Acquisition Readiness Plan enables HR Directors and Boards to develop an upfront understanding of their organisation\’s risk appetite, e.g., the extent to which the existing operating model could or should be adapted. In addition, undertaking a health check of the current HR team ensures that, when the time comes, they are in a strong position to deliver the change.

Our belief is that undertaking this activity at an early stage is a prudent investment in the preparation for strategic acquisition: one which mitigates the people and HR risks associated with such transactions.

Please contact us if you’d like to discuss further how we can help your organisation deliver the people related aspects of its acquisition and merger strategy.

Julie has extensive experience within ER, Reward, Policy and Performance. She has held leadership roles within financial services, working in UK banking and international business areas at Barclays and, prior to that, the London Stock Exchange.

As a Partner at 3XO, Julie has supported clients from a wide variety of sectors as they develop and implement HR initiatives, including in the areas of reward, HR team transformation, performance management and policy.

\"\" — Rupert McNeil, Partner & Chair 3XO

Rupert is the Chair of 3XO. He was previously the UK’s Government Chief People Officer (2016 to 2022), and prior to that Group HR Director of Lloyds Banking Group and held senior HR roles at Aviva and Barclays.