Nancy Robin Gillman

Why buy a company when you can cherry pick the employees? Companies often acquire other organizations to attain talent, and do not realize all of the costs involved other than the initial sticker price.

Goldmines of Talent.

Some companies are goldmines of talent and are often considered great deals. However, on further analysis or after acquisition, hidden costs are found. There may be under/low performing employees; repetitive processes, functions, and replication of positions; major cultural differences; disparity in strategic leadership; burdening debt; restrictive contracts; and problematic locations. Perhaps these issues can be avoided through due diligence and/or resolved through great leadership, but at what cost?

Taking a Good Hard Look.

First, a company needs to ask why they are considering acquiring another company. If a company’s main reason for acquiring another company is to obtain talent, they need to decide if acquisition is really the best route to go. This means taking a good hard look at all costs involved-- not just the actual selling price but also the hidden costs and domino effects to the company, the acquired company, the employees, and the economy.

These acquisitions can cause difficult employee integrations and layoffs due to cultural differences, repetitive functions and processes or duplicate employees. This usually results in lower employee morale, higher turnover, lower production, higher costs, and lower profits.

Like Brain Surgeons…

Skillful recruiters can minimize costs enormously. Like brain surgeons, they can carefully target, extract, screen, and present much needed candidates to their clients. After candidates are hired, they can be more easily integrated on a case-by-case basis than can many new employees in the case of a massive acquisition. Depending on recruiters’ fees and the volume and quality of recruiting needed, employing third party recruiting services can be a much more economical route versus acquiring another company.

Cherry Picking.

Cherry picking, in addition to reducing costs, allows companies to acquire talent at all levels and fields from companies globally. After a company considers all internal and external factors, it may decide that cherry picking employees may be a more customizable and beneficial route to take not only because of the costs, but because of the opportunities offered.

This article was written by Nancy Robin Gillman, EMBA. Founder of RGCS, she has been an HR consultant since 1995 and has provided consultative services to many local, national, and multi-national companies.