Success Stories

Financial Services Company with Diverse Holdings and A Recent Major Acquisition

Services – Merger & Acquisition Support, HR & Benefit Strategy, Program Redesign & Consolidation, Communication Strategy, Change Management, and Branding

The Situation
An organization owning insurance companies and banks had just acquired another large insurer along with several ancillary businesses. Within these groups, there was broad array of market objectives, HR strategy, pay and benefits plans, and organizational cultures. The company needed to create a shared sense of identity, consolidate and streamline programs to reduce cost, yet ensure that each operating unit remained competitive.

Key Challenges

• Multiple acquisitions resulted in diverse lines of business, with entirely different employee profiles, demographics, and needs.
• Employees had no "connection" to the new organization.
• Each division had distinct benefit priorities and programs. For example, the parent company offered a pension plan, while many of the acquired companies had only a 401(k).
• Although the new organization needed to be market-facing and customer-focused, the culture in each of the divisions was largely paternalistic.

Our Approach
To develop and implement an effective "people" strategy, Strategic Planning Associates:

• Conducted interviews with managers and leaders in each of the operating companies, gaining perspectives on their businesses, potential links with other divisions, industry-specific HR and benefit issues, and overall merger objectives.
• Analyzed all current HR and benefit and programs, compared to other divisions, as well as competitors in their industries and regions.
• Led focus groups (including a written questionnaire) with more than 200 employees, across all business units, job levels, and major locations.
• Created brand and identity for consolidated HR function.
• Redesigned entire benefit platform, creating a common "core" of coverage across all operating companies, and giving individual divisions the flexibility to tailor offerings based on industry norms and business needs.
• Designed new benefit program, giving employees more choices than ever before, including core, optional, and lifestyle benefits
• Developed strategy to transition divisions from defined benefit pensions to new “super” 401(k) plan.
• Designed new 401(k) to respond to specific employee feedback regarding plan features: added core company funding to replace pension plan, and reconfigured company match into tiers to provide additional incentives to save.
• Launched extensive communication campaign, including:
• Team-centered theme for HR and benefits, reinforcing key messages of one company, one culture
• Focus on creating linkage across business units and recognition that “we’re all on the same team”
• A range of written materials (newsletters, posters, highlights brochure, enrollment materials, user's guide), videos, and employee presentations
• Emphasis on unique advantages of new 401(k) and employees’ role as partners in retirement planning
• Training of local personnel to lead employee meetings, deliver consistent messages, and be responsive to employee questions/concerns.

Results

• Widespread acceptance of, and enthusiasm for, new "identity" as diversified organization.
• Landmark IRS ruling on DB-to-DC transition strategy ("Reverse Spin-Off Termination").
• More than 95% of employees chose to contribute to the “super” 401(k).
• Significant savings to the company through program consolidation, streamlining, and redesign.

Strategic Planning Associates was retained to do several follow-up engagements for this company, including strategy for subsequent acquisitions.