A huge part of any exit strategy is properly planning for that moment in time when employees find out the business is for sale or, preferably, has been sold. Your workers have been kept in the dark for as long as possible. Some won’t be a bit surprised. Others may be devastated.
In almost all cases, an owner should delay the news as long as possible. There is usually very little to be gained by “getting the word out.” Thousands of business owners can relay stories about the damage to their business or the emotional trauma that accompanied a premature release of the information. Don’t inform employees what’s going on until the transaction has closed. Or at minimum, the buyer has removed all contingencies and there doesn’t appear to be any major roadblocks to the finish line.
Resist the excitement and temptation to share your secret. It may even seem dishonest to keep employees in the dark about the sale. But not only could it cause disruption to the business, it could cause unwanted worry with your buyer about the potential for a smooth transition.
There will be some circumstances which dictate telling your workers ahead of time. The most common is when owners need the cooperation of employees to prepare financials, orchestrate tours, or provide information that the owner cannot. The other important consideration (which deserves an article all its own) is your "key employees." Many businesses have one or several critical workers who deserve special attention or retention strategy planning. In all cases, you should emphasize repeatedly the importance of confidentiality in the process.
When It's Time
Many owners stress about how to break the news. Managing the messaging is critical. In today’s smartphone universe, it’s a mistake thinking you can get the word out in several stages. News will travel instantly among your people. Use that to your advantage. Do it once and do it well.
Try to bring together as many employees at the same time. Teleconference the announcement if needed. Do not bring the new owner, or representatives, to the announcement, unless there is an unusual circumstance.
Challenge your employees to take complete ownership of their work and assure them their jobs are secure. Invite them to become actively involved in the transition, within limits. Keep it short but informative. Be honest and comfortable in telling them the circumstances behind your selling. Emphasize this will be a win-win-win for you, the employees and the new owner. Calmly convince them the company will go on without you.
Be ready for all types of reactions. Don’t be surprised if someone tells you, to your face, they're glad you're leaving. Try to soften the blow with your words and actions.
Keep things upbeat and honest. Don't dwell on the experience, merits or background of the new ownership. Selling that comes later. Let them know they are among the reasons the new owner is so excited about the purchase. Ask employees to keep the news within the company until you’ve had a chance to contact customers, vendors, suppliers and maybe the media.
Spell out briefly how you envision the transition to play out. Emphasize that you’re going to be actively involved through the process and can be contacted. No one likes change. But remaining forthright, calm and supportive can go a long way toward a comfortable handoff of ownership.