Management Buyouts: HR and the Fitter, Leaner New Firm

Every new owner wants to see their company to emerge leaner and meaner after a Management Buyout.  But are you making your job more difficult by ignoring your HR?

When a business changes hands, there’s always upheaval: panic over job security, financial restructuring, rebranding and legal headaches.  It’s a tense time for you and your workers.  But, after the dust has settled, you could be in charge of a fitter company and HR is increasingly seen as the key.

During an MBO, many new owners choose to assess the health of the firm and trim away the dead wood. It’s an ideal time to assess your workforce and see who is shining and who is underperforming.

In some cases, evaluating your workforce can throw up interesting trends; stress in one department driving down productivity, for example.  If you can see this you can assess whether these employees or departments need extra support.  Perhaps there are employees or managers who are simply not pulling their weight?  Getting to the heart of these troubles is just as important as getting the legalities of the sale right.

Your HR team is in the best place to assess the state of your workforce. But this must be done with diligence, care and compassion. It is important that you’re not seen as ruthless or you’ll encourage resentment and paranoia among the rest of the staff.  That’s not the best way to start a new venture.

Many employment consultants are warning that HR is all too often dismissed as a secondary concern during an MBO.  But, with TUPE regulations to consider and savings to be made, there are opportunities and dangers that only good HR can balance.