Toronto—A new Towers Watson survey suggests companies most successful at talent retention during mergers and acquisitions (M&As) begin identifying people and tactics early.
While the majority of companies involved in M&As use retention agreements to retain key talent, more successful companies don’t rely solely on money.
The survey found successful buyers included the 44 per cent of respondents who rated their retention agreements as being highly or mostly effective at retaining employees during an acquisition and who also retained all or nearly all employees through the retention period in past acquisitions, according to Towers Watson.
72 per cent of successful acquirers determine which employees are asked to sign retention agreements either during the due diligence stage or during the transaction negotiations.
This number is twice the that of less successful acquirers (36 per cent) who ask employees to sign agreements during either of those times.
Nearly six in ten (58 per cent) of less successful companies don’t ask employees to sign agreements until after the transaction closes.
The survey also found 92 per cent of successful acquirers use retention bonuses, compared with just 53 per cent of less successful companies.
Additionally, 74 per cent of successful companies use personal outreach by managers and leaders, which is three times the number of less successful acquirers.
Conducted earlier this year, the survey included 180 companies from 19 countries around the globe, with more than half of the respondents completing between two and 10 acquisitions over the last two years.