Practical advice for the management of human capital before the sale of a company

This week Citigroup announced the sale of its consumer banking and business banking operations in our country, which includes the Banco Nacional de México brand (Banamex). The sale of a company it is a possible scenario in any industry and talent management, leadership and communication are key at such times.

Specialists agree that an announcement of this magnitude, especially when there is no buyer, creates an environment of uncertainty within the organization, which can only be addressed with transparent and frequent communication. Citigroup It has been selling its consumer and business banking in different countries for almost eight years, practically in all transactions it has reported the sale without having a defined buyer.

The bank has reiterated that for now there will be no changes to its template of 31,406 workers during the process that can take one to two years. In any organization, this period carries risks in terms of human capital management, from loss of productivity to flight of key talent.

Rogelio Salcedo, partner and CEO of Olivia Consultoría, affirms that in a transaction of this type the communication process It is important and cannot be minimized.

“The typical reaction after such an announcement is uncertainty. In this case, the communication must be in the sense of telling people: yes, we are going to sell it, it is not immediate, do not worry, keep working and when there is a buyer we will see what happens and we will inform you”, explains the specialist. .

In this sense, Rogelio Salcedo states that the message that the company gives to its collaborators must be accompanied by the reasons why the sale is being made.

Citibanamex has the third largest bank loan portfolio in Mexico and a delinquency rate of 1.98%, a level below the average of 2.15 percent. But when selling a company, not only the profitability of the business and the infrastructure of the organization are offered, the workers template that make up the company are an important part in the acquisition of a company, hence the importance of good talent management in this context.

For Jorge Rosas, CEO of the WeWow consultancy, the sales processes of a brand are the leadership litmus test and it is in these situations that leaders are required to “stick their heads out, stick their chests out, and communicate during these moments. The first obligation that a leader has is that people do not find out through the press, that would be very serious. You have to find out in person from the president of the company or from the CEO”.

The specialist points out that during these processes a transparent communication, assertive, positive and at the right time. “You have to tell them the whole truth, there is no other way. People are not stupid and people realize how the situation is going inside an organization and if you don’t communicate it, it opens the space for people to guess and you have to fill that space as the leader”.

It is valid that in such a context a leader does not have the answer and answers the collaborator who does not know, but keeping the commitment to communicate any information you have, says Jorge Rosas.

“You have to communicate three things: why it happened, where we are today and where we are going. And you have to demystify general versions. In the specific case of Citi, it has been mentioned that all the branches will disappear and it must be clarified that this is not the case, only that they will probably change their name and that does not imply that all branch workers will be left unemployed”, exemplifies the specialist.

Why is management important?

When the sale is finalized, Banamex workers will be the ones who will experience the most changes at the organizational level. In every company that is for sale there is two issues that generate more uncertainty: the first, if the post can be kept; the second, who will be the buyer.

The second concern is aligned with the first. In the case of Banamex, the continuity of some Job positions It will depend on who the buyer is. Specialists estimate that if a large institution acquires the brand, it could lose around 70% of the current workforce from the bank.

In a scenario like this, the Flight of talent key is a fairly real scenario, says Rogelio Salcedo. “There is a group of people that is critical intellectual capital and retention plans must be made for them. You have to identify the key talent and tell them that there will be a transition process, that you want to keep them and for the fact that they stay, they will be paid.

The key talent retention It is an aspect that cannot be ignored when selling a company, because to a large extent these profiles can make a difference for the acquisition of the business.

Jorge Rosas agrees on this point: the companies that will enter into a sale process must keep their key profiles. “Something important that has to do with talent strategy is that it is very natural that very talented people want to move and the buyer is interested in staying with those talented people. It is not the same to stay with all the rock stars of the company, to acquire it without them. Something you have to do at the human resources level is to safeguard the company’s talent as much as possible”.

The risk to productivity

But good talent management is not only a way to retain key talent, it is also necessary to prevent the productivity fall during the sales process and, therefore, the business is less profitable, the consultants agree.

“If they tell you that they will sell the company, well, you don’t feel like it anymore. The productivity loss, the loss of customer service, the increase in theft, fraud and customer dissatisfaction goes through the roof”, explains Rogelio Salcedo.

Therefore the importance of having a transparent communication with which the collaborators know where they stand, points out the partner and general director of Olivia in Mexico. “If they call me to offer me a loan or a better rate, I’m sure I’ll run away and the same thing happens with the employees. If they are going to sell us, why worry? The loss of productivity is what affects you the most as a consumer”.

In addition to the loss of productivity, Jorge Rosas believes that one of the risks of poor or non-existent talent management during the sale of a company is the talent paralysis.

“That’s one of the biggest risks. In the face of uncertainty, as the saying goes, I quietly look prettier. And what people do is stop, if they were going to propose a project, they don’t do it anymore”, he points out.

Right now, the CEO of WeWow points out, is when you have to be motivating people the most. “You have to tell them: come, propose and let’s continue innovating. Here it is not save yourself who can, here it is we believe value”.

But uncertainty can be present in both directions. The concern about what might happen is not a situation that is limited to the company that sells the business, there is also uncertainty in the company that acquires the brand. “Uncertainty ends when redundancies are removed. Example, we have two directors of Human Resources, with which we stay. In one of those, the one from the company that was acquired is better,” says Jorge Rosas.

Faced with this panorama, the specialist considers that workers, regardless of their role, must seek to add value, be multifunctional and manage emotions.

Legal scenarios before the sale

Similar to what happened with the subcontracting reform, the outlook for workers during the sale of their company can raise up to three scenarios, explains Carlos Ferran, managing partner of the firm Ferran Martínez Abogados.

“There are no general rules. When there is this kind of corporate movements There are many possibilities. An employer substitution can be configured, but also a termination of the employment relationship with recognition of seniority”, he points out.

From the perspective of Carlos Ferran, the first legal scenario in these cases is a employer substitution, a procedure with which workers are transferred from one company to another, without changes in working conditions and respecting seniority.

The other two scenarios are termination of the employment relationship and hiring with the acknowledgment of antiquityIn these cases, only a severance payment is usually granted, but the employment relationship with the new company recognizes the years worked in the acquired company.

The last assumption, explains the specialist, is a termination of the employment relationship and the signing a new contract. In this case, the worker receives a settlement from the company and begins a new employment relationship with the company that bought the brand.

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