Roll out the transition
Once you put things into final motion, you have to plan for everything that happens right before, during and after the actual merger. That may mean a lot of financial work and press releases, but it also means keeping in mind the number of people involved on all ends.
“When you acquire something, there are a lot of different audiences,” Woudstra says.
Write down all of them and consider how the message should be portrayed to them. For Farmers’ acquisition, there were shareholders, employees, employees of 21st Century, customers of both companies, distribution groups like independent agents and so on.
“The way you meet up in the best place is when you understand who all your audiences are and you go about specifically talking to them, and not just in some general sense but more specific to that audience,” Woudstra says.
Farmers did that internally even before the transaction happened, explaining to the people who would be involved with the nitty-gritty details of the deal why the potential asset was important.
“That group we sat down and spent time describing what were the strategic reasons we would have an interest in evaluating this company so that group could completely understand our thinking strategically,” Woudstra says.
While rules and regulations will determine how hamstrung you are in telling details, as soon as you can say something, do. When the first announcement of the acquisition was made on April 16, Woudstra got on the phone with the top 250 people at Farmers to explain details.
Farmers also had a plan ready to go to get in front of other audiences immediately.
“Within two and a half days after we announced the transaction, we were in front of more than 12,000 of our 15,000 agents, face to face with a senior executive explaining exactly what this transaction was all about,” Woudstra says.
A plan like that intentionally includes senior people, and more to the point, it intentionally includes people who were close to the deal.
“It wasn’t just an employee; it was a very senior person and a very senior person who was involved in the due diligence of the asset and had the complete understanding of the 21st Century group and could articulate very strongly how we saw it fitting into our business plan and believed in it,” he says.
He also did what he could to address 21st Century in mass before he could do more personalized things, so he put together a video to address them.
“They’re in different locations and there are about 5,500 of them, so I had an opportunity to put a video together so they could at least see me and I had the opportunity to address them,” he says.
You have to continue that communication through all of the stages. Like the different audiences, you have to realize the stages of the acquisition — from the first hint of a deal to the day the two companies merge. At Farmers, the company put a message up on its internal site in July to welcome the new people when the final transition took place, and Woudstra and four other senior executives went to Wilmington to do town-hall meetings with 21st Century’s top executive Tony DeSantis and his senior team.
Prior to that, all of 21st Century’s people received a welcome bag with items like a personalized letter from Woudstra, a Farmers informational DVD and brochures giving an overview of company benefits information. It’s something Woudstra remembers making the transition easier in 2000.
“Again it’s welcoming and making them feel what they were becoming a part of, and even as we explained this to the 21st Century people, they were quite impressed to the lengths we were going to reach out to every employee to let them know that every employee was important,” Woudstra says.
How to reach: Farmers Group Inc., (800) 327-6377 or www.farmers.com
