Seed Speaks Ep. 10 Employee Retention During Mergers and Acquisitions

[Music] well hello everyone and welcome to episode 10 of seed speaks my name is alex martin and i serve as the editor of seed world magazine and today i'm absolutely thrilled to be your host today we're going to be joined by four panelists to talk about um a fairly difficult subject employee retention during mergers and acquisitions it's a difficult topic because of course change is one of the hardest things for a business to overcome but we have a lovely slew of speakers who are going to help us overcome that fear of change and work to embrace it instead and with that i'd like to go ahead and introduce our speakers we have two speakers that are working to join us at a later time but for right now i'm joined today by dr scott downey director of the center for food and agricultural business at purdue university and uh blake krogert director of verdant partners our other two speakers joining us later will be jonathan shafer owner of envision partners and courtney white head of hr for basf agricultural solutions so we're just waiting for them to join us but until then um blake and scott are going to get us going um blink and scott since y'all are both online with us um i'd like to um start with a small short introduction so um i'll start with scott and then move on to blake but uh dr scott how about you go ahead and give us a short introduction of yourself and purdue and um what it is you do sure i'm happy to alex hello everybody uh thanks for the opportunity to be here um i am director of the center for food and agricultural business at purdue university and a professor in the department of agricultural economics where i teach and coordinate our sales and marketing degree program great thank you and blake same question to you we're gonna work on uh seeing if you can introduce yourself as well and then we'll move on to courtney thanks for joining us courtney great thanks alex and thank you for for having us here blake kroger i'm a director at verdant partners in champaign illinois we are an m a advisory firm focused on the global food and agriculture industry perfect and courtney why don't you introduce yourself to us as well thank you alex hopefully you can hear me okay i can yes all right i i tell you i'm uh i'm still learning along the way but courtney white i am the head of human resources for basf agricultural solutions um responsible for north america our global season traits business as well happy to be here and um hopefully everyone knows basf perfect well thank you three and we're just waiting for jonathan so once he gets on he'll join the conversation with us too but um let's go ahead and dive in um so in the meantime scott our first question is directed to you um scott i'm sure in your time at purdue you have seen and heard a lot about mergers and acquisitions throughout agriculture what have you heard as being the biggest concern from employees during a um transitionary time like this it's um it's a personal issue for me uh as well i'm in my second career i was a banker for 15 years before i came into academia during a time when there were a great a large number of mergers so i have been through 14 of them in my own career that's how busy the merger time was uh you know one of the things that i think is is is most on people's minds uh as they're going through this uh time when there are more mergers is how you know will i be okay uh and i think that's the main thing that employees take away out of this is a desire to have knowledge about what's happening to know that they're going to be okay and frequently also to make sure that their customers are going to be okay work closely in the in the sales area and it's often one of the major concerns sales people have no that makes a lot of sense um that making sure that everyone's going to be okay so our second question is for uh blake very similar question but i wanted to ask you blake from the exact opposite end do you have do you hear any concern about employee retention from owners conducting the mergers and acquisitions at the time what's what's kind of the top of mind for them blake yeah it's a great question alex and and actually scott's lead-in is perfect because the two are very much related in my opinion your a critical facet with any transaction and you know keeping in mind what scott said employees are the lifeblood of organizations and ensuring that retention is adequate is only going to result in the business that's being acquired getting to its full worth of potential so it's critical really that buyers understand the capabilities of the team that's transitioning the skills that are there and successfully integrate those into the acquired selling entity separately i think a concern and a potential problem that we see in transitions is different benefits compensation structures cultures between similar employment roles and that's certainly unique to each transaction but um buyers need to carefully assess and as do sellers mitigate any potential problems that they could that can result in dissatisfaction either on the buying or selling side uh to ensure the transaction strategy is fulfilled okay thank you so much like that that does make a lot of sense to you um i'd like now to ask a question to jonathan which if you um would see we have now had him join us so jonathan first i'd like you to um do a brief introduction of yourself but then i want you to answer the question since you were from a bit of the different side of scientists and plant breeders what's the best piece of advice we've given uh these more scientifically driven employees dealing with a merger of actual coaching well and it looks like jonathan might be having some technical issues so i'll go ahead and go to our next question courtney so we can keep going so courtney um you've gotten to go through yourself an acquisition of different bayer asset assets into basf ranging from their vegetable seed company to their cotton seed brand to the canola seed to soybean seed brands um so in in your um opinion what were some of the steps that basf took to kind of smooth out that transition uh thank you for the question alex i mean um we there were several steps but maybe what i'll do is highlight three and pardon the sports analogy but what we learned is what has proven true time and time again the best way to prepare to win the game is based on the practice drills you run during the pre-game practice sessions so step one i would refer to as collaboration defining a mutual approach goals objectives as well as determining who really need to be a part of the collaboration from both organizations our goal was to plan and prioritize what needed to happen immediately versus what could be delayed often people think everything has to happen right away or at the same speed and that's simply not the case it's always going to be a journey the the next step that i'd like to mention is communicate it was vitally important to ensure we kept an appropriate cadence of meetings on the calendar across multiple levels to ensure we remained on the same page as well as understood the statuses of where we were beyond the project team however it was equally important to keep all of our uh prospective new joiners and current employees up to date in order to manage expectations you learn over the years that in absence of sharing information sometimes you know people generate their own narrative and i should know this communication should and has to be two-way and then the third step that i will will mention for the sake of this conversation is commitment everyone has to ensure they understand their role in this change management journey uh we have to acknowledge the realities acknowledge the journey and seek commitment from everyone a way to do this for us was to ensure that all decisions weren't made by the project teams to the degree possible we desire to have shared decision making shared decision making often helps people manage you know negative response or what could have been negative response to change because they are participating in the story rather than just being targeted readers thanks no that is perfect courtney i'm i'm really glad um you brought up this this idea of communication courtney because i feel like that's one of the most important spots to talk about and it leads really well into my next question for scott which is scott i feel like half of the battle after a merger is trying to explain to employees why this change occurred um so what do you usually recommend to those leaders in charge of acquisitions during these times how do you how do you how do you tell them to coach to their employees why this change is happening yeah so i think it's a really important point and [Music] that was a terrific courtney uh summary of those three c's through that process but i think for leaders in particular and i started out saying i think people uh care and and worry about their their own lot in life and their customers and i think so for leaders uh explaining the why can't just be the why we did it as a company i think that focus also has to be on how it benefits customers what the impacts are going to be to employees people care more about their own why's than they do others and we tend to i think overvalue explanations when explanations always uh rarely do justice to the complexity of decisions that are made that said there are employees who certainly worry uh if particularly if they're on the acquiree uh uh side of that equation uh that there was something they did uh that that led to that from a negative perspective uh and that that's almost almost never the case uh um but so some assurance about that uh i think is an important part of that explanation of of the of the why and uh talking about uh where things are headed so i you know i think for leaders the message is keep it simple uh be direct um uh certainly be uh truthful and honest uh there's always challenges because leaders often know things that um [Music] aren't wise or legal to publicly disclose but be focused on others so empathy is the driving force for that no i think i think that makes a lot of sense that keeping empathy in mind during this time kind of helps um to go along with that kind of idea um blake my next question is for you um how should leaders work to keep their employees engaged during this merger or acquisition and maybe as well what should they avoid doing yeah it's another good question alex and courtney and scott both segways are excellent there i think you know when it comes to the question about keeping employees engaged it's it's a difficult balance in a lot of ways but to courtney sports analysis you're asking somebody not to just play offense and do their regular task but now all of a sudden they have to play defense too employees are going to be doing their daily daily tasks items but then have to spend a significant amount of time working on a transaction being put together and they'll have to go above and beyond what their normal to do's are the one way i think that we see a lot in transactions and depending on the personnel and what their level is and certainly on the transaction structure is creating incentives for key employees to potentially be rewarded for the extra effort that goes into a transaction i think the the other point is is on communication to scott's certainly emphasizing to employees the future value of working with that potential acquirer needs to be stated early and often but the the balance of win again back to scott's point is the most difficult confidentiality is certainly a concern on who is able to be made aware from an employee standpoint of a transaction process as well as when so balancing i think the the need to know who needs to know and when they need to know and effectively communicating the process with those individuals is a really important item and it's unique to each and individual transaction but needs to be handled very carefully between buyer and seller perfect thank you so much blake we actually just got in an audience question if um y'all wouldn't mind taking a stab at it i'm i'm gonna leave this open to whichever three would like to answer of you um it's from ashley robinson she asks how as an employee should you handle your day-to-day work during a merger uh i'll i'll uh jump in there uh real quickly so i i think it's a great question and and i think it's also emblematic of uh what i've been saying as you know it's about how does it impact me and of course it depends on what your role is as an employee but but um there are i think that there's a tendency to um for us to use informal communication frequently uh when we're not in a leadership role through the merger and by that i mean it's awfully easy to kind of get sucked into the unofficial stories uh i'll call it gossip about um what's going to be happening um and i think rarely does that do those gossip mills actually hold very much value ever but certainly during a merger i think there's a lot of that so you know how do you as an employee handle this number one uh stay positive uh things are outside of your control and and that's disconcerting for all of us but one of the best ways to deal with that is to is to try to stay positive not just for yourself but for your customers and your colleagues uh who are also experiences the experience in these same things so sometimes to help ourselves it's easier to help others and so stay positive in that way i think is useful yeah scott just added i think it's a perfect point we often advise our clients and not just employees on transaction processes to continue the status quo which is an impossible thing to do considering all the noise that's going on but you must operate as if the transaction weren't happening and you're you're still pursuing business leads and what's in the best interest of the company if in the inevitable event the transaction doesn't go forward and i think that that holds true to employees and their individual roles as well of course courtney you know it's interesting and maybe the the one deal because i agree with what's been stated you know this happened uh earlier in my career and um you know i without knowing uh maybe at that point i took the advice that was just given continue the status quo uh and i remember being visited by my colleagues every day asking uh was i okay did you not hear the news courtney uh there's going to be a merger and they expected me to either relax or you know start doing something different uh but my goal at the time was you know i'm still being you know paid to do a job and i need to you know keep focused on that until someone says otherwise and um actually it turned out the exact way as uh what was outlined that was the the best thing to do so i wholeheartedly um agree with that and the one thing i will say is you know your responsibility to yourself uh and your family from my perspective is the same whether a merger or acquisition is going on or not and that is to always do what's best for you all um and in your best interest and hopefully it's always to remain focused and stay with the organization but i would say that's not necessarily the fact of just always be aware of what's going on to the degree possible thanks perfect well you three i think led into our next audience question from sonia elaine very well i'm going to start by directing this to courtney because i feel like i i feel like since this has happened so recently to you you can talk to to it how do you maintain and or boost that employee morale when there could be staffing cuts after a merger courtney you just mentioned that that people were walking around asking you you know are you okay and things like that how do you keep up that morale during um i hate using this because i feel like we hear it all the time during the pandemic but a time of uncertainty it's a it's a great question um you know uh respectfully i think scott scott said it well too um it is really about understanding you know what's in your control what's in your influence and what's outside of it and navigating it now i say that more simple than it is to do uh quite quite often um but it is something that you learn more and more over time this is why change management is such an important uh competency capability and focal point in organizations because what everyone would love to be able to say is that nothing will change things will stay the same but we also know that that's not the recipe for growth that's not the recipe for business and that's not going to happen and so the thing that happened that that does have to happen is we have to figure out how we manage ourselves through it how we respond to it and as we continue to to learn that then quite honestly i think you begin to determine you know what are your coping mechanisms uh where ultimately the goal is to do what was already stated by other colleagues on the call you know stay positive stay focused and again remember that while it's not all about you it's still about you thank you perfect scott or blake do y'all want to chime in on it anymore do you feel like it's all been said then no i think courtney really well said i may be the only addition and just to emphasize it is controlling the controllables in a lot of ways there are things that you can keep within your court and others that are outside your control but ensure your best likelihood outcome depending on what's in your control the only thing i would add is as a as a leader through these types of situations i think it's really important to be be clear about your your messaging internally and externally and uh it's it's not new news but uh the rule of threes works pretty well and identify you know what what are those three things that can be our rallying cry uh when people around you are losing their positions friends uh are losing their positions it's tough uh and it's it's a good time to make sure that we're we're clear about uh what we're about how are we going to continue to work uh together uh and i think that's kind of the we're in this together is one of the key factors uh in in those times after there's been um changes to the employment level in an organization that's perfect thank you three um i'm getting back into it one thing i i think we've kind of touched on a little bit but i haven't really dove into is this idea of um excuse me of uh company culture so scott i this question i i had directed to you um how does come excuse me how does company culture factor into mergers and acquisitions and employee retention um for example is it difficult to take one separate work culture and another and combine it into one perfectly new one i think because culture's one of those squishy words uh it's easy to ignore it and so it might be useful to kind of think through what do we mean by that culture and i i like to think of culture as kind of the unwritten rules that we all follow policy is written rules obviously culture are the ways that we treat each other the ways we've always done things but anybody who's really interested in in uh digging into this culture topic i would encourage you to google the words cultural artifacts uh because there's a lot of ways that culture is exemplified or that comes out with within a company and it's not oftentimes culture is not just the big things it's it's little things so i'll give an example that one of the companies that uh when i was in banking uh i was in a company that you know they always call it the merger of equals but it was not the merger of equals our our company was clearly the lesser of the equals uh and uh the company that i worked for had always celebrated the holidays uh uh in a pretty big way so at thanksgiving of every year the leaders of the company went to every location and brought everybody every employee a big old turkey before thanksgiving like the monday before thanksgiving and shook everybody's hand and thanked them uh well the merger closed in july and everything stayed the same until october but the new company was clearly in charge by november and the week of thanksgiving came and there were no turkeys uh and boy you would have thought the sky had fallen because there weren't any turkeys and uh you know the new company just didn't realize that that was an important part of the old culture so so the next monday they tried to make it right and they they sent everybody a coupon uh for a free turkey at uh christmas uh they didn't quite get it right though because the grocery store that you could go to to get it was at the only at the corporate headquarters of the new company and so it's easy to stumble on the culture issue and so the idea is be aware of what those traditions are and and try to engage with them but it's also things like you know you know what what uh do how do we treat uh company logos uh what do we allow company logos to be on when or when is it okay to wear clothing that has those logos on it so it's a lot of little things that make up culture but talking to some of the people who've been around so that you can understand what somebody else's culture like is always a key to bringing cultures together okay thank you scott um i think we have enough time for two last questions one for blake and one for courtney so um like similar kind of question i wanted to to take another stab at culture while while we're still here um like like scott mentioned it's easy to stumble and it's easy to miss what might be important to one group of employees versus what's important to another group um what what do you recommend when it comes to uh company cultures yeah thanks alex i might echo a lot of what scott said um but to me there's there's maybe a breakdown of two two different items i think one is more large strategy culture between buyer and seller the two companies that are coming together and those are often things that in our opinion should be done prior to the transaction process really getting underway pre-diligence by companies to ensure that the the culture of either the acquired or selling company lines up with that of the other party when you get into the smaller more i mean to say smaller but some of the additional items that that scott mentioned like turkeys for example um those are things that only can be solved with open communication and that happens throughout the process and people need to be doing an effective job of communicating with one another what are those things that are clearly important to the employees that are coming into a new organization how do we utilize ensure that those are continued but also maybe even leverage some of those to improve our own company culture and employment dealings so two different areas in my opinion but but all of them function and factor around good communication perfect and then courtney final question coming to you um it's all about uh communications still as well um we haven't gotten to talk about this yet i don't think um so since we've already kind of talked about the transition the how important it is to take in company culture and things like that how important was it for our for you at basfn um the staff at basf to make sure everyone understood the big picture of basf during this transition it's a great question and i think you know other colleagues too on the call have talked about it in in different ways where ultimately i would say it was immensely important to ensure that everyone understands the big picture from my perspective it's a question of the value proposition uh you know during the merger of acquisition as uh what was stated uh you know employees often feel that it's happened to them rather than with them or for even for them and so our goal was to ensure that everyone embraced versus tolerated the transition to basf uh it becomes a factor of engagement because you know we need everyone to understand the big picture and how they fit into it that's how we also tap into the discretionary effort that our organizations count on to fuel the innovation that keeps us moving forward truthfully this was easy for us to do because our big picture got even stronger with the acquisition and we wouldn't have been able to say so without the colleagues who were joining us so the big picture hugely important perfect well thank you so much you three i think that's all the time we have for today so i want to give a big thank you uh to our audience for participating and to scott courtney and blake for joining us and a big thank you to jonathan as well even though he had technical issues he was still here on the planning side with us and we'll make sure to get his comments for you all so you won't miss jonathan's portion of this live either and just a reminder if you missed any portion of this live we'll be putting up the recording on seedworld.com later this week along with an article and if you liked this topic make sure you tune in next week to hear germination editor mark sequit talk about work safety in the lab during covet 19 as well as how to develop a plan for employees to do safe lab work in facility inspections um it'll be a great topic it'll be really informative and i'm i'm looking forward to it next week so we hope to see you all next week thanks so much everyone bye-bye