HR can play an important role in acquisition integration and change management. Craig Donaldson speaks with Steve Sargent, CEO of GE Commercial Finance, Australia & New Zealand, about his approach
HR can play an important role in acquisition integration and change management. Craig Donaldson speaks with Steve Sargent, CEO of GE Commercial Finance, Australia & New Zealand, about his approach
How are things changing in general under the leadership of Jeffrey Immelt?
Jeff Immelt has implemented an intensive focus on growth since becoming our Chairman and CEO. Specifically, the focus is on making growth a process with a continued focus on process rigour, to ensure we keep driving organic growth to work more efficiently and effectively. This means we can ultimately free up resources to invest in our growth efforts. As part of making sure we have 100 per cent clear accountabilities around growth, we have introduced five growth leadership traits combined with the values and actions to ensure we drive growth through our people.
How are things changing for HR as a result?
For HR, the key focus is on making sure we have people in the business who really understand how we need to achieve our growth targets. The growth leadership traits are also critical, one of which is inclusive leadership. HR plays an important role in pulling together programs that support all the five traits but particularly inclusive leadership. One of the other key areas of focus is employee engagement – without engaged employees we won’t achieve the growth targets now and beyond. We will soon be launching a series of programs for our leaders on inclusive leadership and how to engage our employees to drive growth.
What are the top three aspects of acquisition integration and change management for HR?
First, getting the people right in an acquisition is absolutely critical. You can put terrific new processes, systems and programs etc in place but if you don’t get the people equation right then it won’t work. I rely on my HR team to be honest about their opinions on who the right people are for roles and who are not. Having them involved in due diligence from very early on and understanding who the key players are, who is open to change, who is going to fit and be able to assimilate into the GE culture, is critical. Bringing HR in after the deal has closed and integration is well underway is too late; they need to be involved from the start. I’d also add that HR plays a critical role in being my eyes and ears during an integration – a good HR team will be very well connected into the organisation and understand quickly where the differences and similarities are and how to take advantage of them.
Second, getting all the HR basics right in an integration is also critical. It’s often something that gets overlooked and sometimes taken for granted by senior leaders. By HR basics I mean payroll, superannuation, employee benefits and so on. These things are really important to employees during uncertain times of acquisitions and integrations. Knowing you have a buttoned up HR team who can handle all of this smoothly and keep employees happy and morale high is important. We all know that happy employees and good morale means happy customers and stronger growth.
Third, from a change management perspective, HR can play a role in helping the organisation –particularly with the senior leaders – understand how to create the vision of where we need to get to and how we can create that shared need felt by all employees in the organisation, regardless of their role or level. HR can also help to mobilise the commitment we need to make the change happen and help to understand who the key stakeholders may be and how we need to influence them. I also see their role as helping to coach our leaders on how to lead and drive change.
For all of these areas, it is critical that HR understands the business – how the organisation makes money, who our customers are and what their challenges are.
What are the most common pitfalls of these aspects?
The first is involving HR too late or not at all and HR not being appropriately connected to the business. The second is not having the HR basics sorted within your own organisation and then acquiring another company – this makes the gaps seems even more obvious. Third is an HR team that has all of the right ideas about how to manage a change program but does not have an adequate enough understanding of the business and how it plans to grow.
How can HR best measure their contribution when it comes to acquisitions?
Certainly HR can play a role in helping to monitor and hopefully reduce undesired employee turnover during an integration. There are the obvious bottom line costs that specifically relate to HR, like recruitment costs and HR supplier costs. Again, having a good handle on those costs in your own business, as well as your HR team understanding those and how they can be leveraged and reduced in the new world, is also important.
How can HR secure executive support in this process?
When our customers tell us that people are their biggest challenge today – people management, performance measurement, leadership development –we ask them how much time they spend on their people per week. We call it the calendar test. If you are serious about a challenge, you will dedicate the time to address it and beat it. If you want growth and the best performance, then time spent on the people is critical and therefore support of HR is fundamental.
