New owners are not motivated to rock the boat with staff changes.
Buyers purchase a practice based on current economics. This valuation takes into consideration the overall health of the practice – due in large part to a strong company culture and good staffing.
It is unlikely for a buyer to purchase a practice and then overhaul its operations on day one. This means that new owners are disinclined to come in and make staff unhappy by, for example, cutting their salaries. Instead, new owners are highly motivated to keep the existing staff in place and satisfied for the ease of post-close transitions.
Here are a few frequently asked questions that we receive, concerning how professional practice transitions impact staff members:
Q: How should I talk to my employees about the transition?
A: The key is to have good and honest conversations with your staff. If these aspects of the deal are true, consider highlighting:
- New Benefits – Often, these are an improvement to their current benefits package.
- Buyer’s Vision – Emphasize the alignment between your current vision and the new owner’s vision.
- Sustaining salary – Reassure the existing staff that part of the deal included advocating for pay scales to remain the same.
Q: What if my staff wants to leave?
A: Communicate openly with your staff when the time is right to share your transitioning news. If you detect that some staff are wanting to leave as a result, we recommend addressing issues honestly and restating the truth:
- Their pay will remain the same.
- Their hours will remain the same.
- Their benefits may be more comprehensive.
- Daily systems will most likely undergo a transition period, but the end result should be more streamlined and less stressful.
Q: What if my staff is overpaid?
A: We represent clients who have very talented staff members. Often, doctors will pay 20-40% over market rate to retain good employees. It not only helps them to build practice culture, but it also helps them avoid attrition, rehiring, and training.
If this describes your approach, you may be concerned that overpaid staff may face cuts. However, in our experience, most buyers eventually learn to live with paying higher wages to maintain the deal.
Q: Is there anything negative that could happen to my staff?
A: The only time that we have seen significant changes with staffing is when practice owners have not been holding staff accountable. Under the watch of new owners who have fresh eyes for evaluation, staff will naturally be expected to do their jobs. We have seen underperforming staff experience pressure and frustration as a result.
We encourage you to seek experienced brokers who understand your practice and are aligned with your vision. They will be able to market your practice and bring in buyers that treat you and your staff with respect. Starting with a broker who understands the importance of staff will lead to successful professional practice transitions.