Talentech: Creating employee co-ownership of the M&A integration process to foster new growth and a united culture

M&A situations can be tricky, even for a HR tech company. Established in 2019, Talentech combines the very best of four industry-leading HR tech innovators: HR Manager, ReachMee, Talmundo, and Webcruiter. Its aim is to facilitate a seamless talent journey, from start to finish, through one central platform. Through scalable solutions that support every stage of the talent pipeline, the company helps its clients think big, but also designs for the details, with personalisation and flexibility in mind. To create the largest HR tech organisation of its kind and ability in the Nordics – united in spirit, and with a common culture – four (sometimes directly competing) organisations had to come together under one roof. Working with the competition took some convincing, as Talentech HR Director Elin Filipp explains.

When it was announced that two Norwegian companies; HR Manager and Webcruiter, Swedish ReachMee and Dutch Talmundo would merge during the summer of 2019, employees were far from enthusiastic. Can you tell us about the situation?

We had been each other’s biggest competitors. People were almost in tears, and everyone was asking themselves how we were going to handle sales and work together with people we had competed with for so long. I was actually able to put numbers on their frustration using a monthly “pulse” survey we used at ReachMee, where I was working as HR Manager at the time. The app showed that our scores for leadership, engagement and culture – which scored 70.8, 70.4 and 76.4 in the spring of 2019 – had taken a sharp dive to 64.3, 61.2 and 71.8 right before Christmas. I felt we needed to take control of the situation and get our employees on board, or else my colleagues were going to stop feeling motivated and quit. We had been through a revolving door of CEOs that year, and had gone from working in small organisations where everyone knew each other’s names to suddenly being part of a company that was the biggest of its kind in the Nordics. Growth pains were probably inevitable.

So what did you do to get employees back on board?

We laid out a plan for a reintroduction program – “reboarding” in HR-speak – for the entire workforce. We used our own onboarding software, from Talmundo. I wanted everyone to feel that working at Talentech was exciting, with new colleagues, big possibilities and as one company. The emphasis on an end result where all employees feel that they belong to one organisation was central to how we designed the program. We had people from the different organisations interview one another; organised culture lunches where attendees met to introduce to their teams, history and organisational culture; installed 360-degree cameras throughout offices to enable remote office visits; ran workshops and made sure all managers checked in frequently with their teams.

I think one of our biggest learnings here and going forward is the importance of focusing on the employee experience of the M&A situation, or the ‘human touch’ if you will. It’s definitely useful to have an HR plan and start collecting employee experience data in good time to help guide the integration effort. You have a huge advantage if you can start measuring things like perceived leadership, engagement and culture early on. What’s important to remember is that M&A is something that happens to you as an employee, but that’s pretty much out of your control. There’s a lot of change in a small space of time that you didn’t actually sign up for when you took your job, and many people actually turn to Google to ask ‘What does a merger mean for me?’. Creating a feeling of progression from the old to the (exciting) new and employee co-ownership of the direction the new organisation , thus becomes integral to making sure key talent stays with you. It’s about handing back a sense of control and ownership to your employees. I’m convinced the consensus-orientated heritage we bring with us as a Swedish company has helped us here – everyone should have a right to influence their everyday work situation! You will find it is a lot easier to get people to pull in the same strategic direction if you’ve also given them the opportunity to influence it, to the extent possible.

 

Obviously, internal communications play an integral role in helping your employees understand what is going on, where the company is headed and how this affects them. But don’t underestimate the symbolic value of signing new employment contracts complete with the new logo and changing your company name and title on Linkedin as a kickstarter for that sense of renewal and forward motion. A low-hanging fruit to get started is to harmonise policies across the new company to increase employee understanding of how stuff is done at the new company – people have different habits and expectations of structure. It’s also a great way to quickly create something entirely new that people can use to orient themselves in that period of change. Prioritise integration initiatives based on what makes your employees feel like one team and company. Also, don’t be afraid of sharing the hard stuff with each other. We made a lot of employee-generated career videos where colleagues shared their Talentech journey – their background, what they are doing now, how they are feeling and what they look forward to. And make sure to celebrate events like the launch of the new brand, again with the focus of creating that feeling of a new entity with forward momentum.

With time, our HR pulse numbers started to go back up again. As with all journeys it’s not entirely linear – moods vary over time, and each office has faced its own issues. In one place we had a manager whose leadership style wasn’t really working out, and in Finland the office wasn’t roomy enough. Engagement rose overnight when we transitioned the team to a new manager, and in Finland our employees reported not only an improved working environment but also better work-life balance with the new office. The entire pulse survey system proved so useful we actually acquired the provider, Weekli.

Critically, the reboarding experience has made HR tools and issues an active part of how Talentech is run, and has helped management connect the dots in many ways. We now have a go-to tool for measuring employee satisfaction and if there are any impairments to productivity. There were a couple of sceptics at first, including worries that there would be unrealistic expectations of change. A number were also concerned about what their own numbers would look like, but in hindsight it’s always better to know what’s troubling employees before things go so far that they feel dissatisfied with their manager.

So how often do managers check their ratings?

I recommend them to do so each or every other week, but many have dedicated focus areas they choose to monitor. Each country manager has access to a full country report with ratings playing into decisions. It also happens that I check in to see if there’s anything I can support a manager with, arrange a workshop on or somehow work with. With pulse ratings coming in every week, big surprises are pretty rare – as opposed to if we would have asked for input only once a year. Interestingly results in a lot of areas have risen as people have been allowed to work from home, particularly for work-life balance and stress levels. Our latest pulse showed a record sense of belonging to the organisation, which we were of course very happy to report.

I’m very proud of the journey our organisation has made, and that if there are more acquisitions going forward we can underscore that we really understand the merger process from an employee perspective. It feels great to work for a company that truly understands and values HR. In fact, we have been nominated to the HR Growth Awards, a national Swedish HR awards program celebrating great work. I feel that we have a good shot at winning!