Acquisition Aftermath, Part I: Managing Account Transitions

By Marteann Bertrand

It seems that almost everyone in our industry is in an acquisition mode these days. The number of answering services changing hands is phenomenal, as evidenced by the growing number of listings in this publication. Forward-thinking answering service owners are buying and selling all over the country. But those who have been in the industry any length of time know that acquisitions have always been one method of quickly obtaining a large number of new clients. And those that have made a practice of purchasing client lists, and other locations, know that customer fallout has appeared to be an inevitable, but constant result of those purchases. What, if anything, can be done to avoid this unfortunate erosion of recently acquired customers?

Many of the “deals” consummated these days are based upon the number of retained customers over a set period of time, rather than the number of customers changing hands at the closure of the deal. This is an excellent method to ensure that the seller pays close attention to the customer service aspect of moving clients from one service to another; but this method alone will not plug the drain in the long run.

In the months prior to an expected acquisition, if the buyer will spend quality time getting his or her own house in order, the transition will be much smoother and the fallout greatly lessened. In our consulting work in managing acquisitions, our first rule is “know thyself.”

The first step to “knowing thyself” is to take a critical look at your own accounts. Develop a checklist of every single piece of information that should be in each of your accounts in order for your employees to provide true quality service. The development of the checklist should be done at an operational level, involving supervisors and operators. These are the people who really know what is necessary to service a client. They also know how many times in the course of any given day they have to say “I don’t know” when a crucial piece of information is not available on their screen.

Next, use the checklist to go over every single account in your system, noting missing information, outdated information, or conflicting instructions. Operators can fill out the checklists during slow times (a better use of their time than reading magazines or visiting with their neighbor).

Finally, call every single client and ask for the necessary information. We recommend a phone call as opposed to faxing or mailing account screens with a request that the client update their own information. Anyone who has undertaken such a fax or mail campaign is certainly aware of the low rate of return, which forces you to make a phone call, anyway. Another reason a phone call is better than a faxed copy of the screen is the phone call allows you to control the situation, gathering all the right information. For instance, if the client’s fax number, or after hours instructions, or business description is not on the screen they receive, it may never occur to them to add it. When making the calls, be sure your callers not only ask for missing information, but take the time to verify all existing information. It’s important to choose your callers carefully, but it’s been our experience that operators are not only capable of making the calls, they welcome the chance to be involved in such a project.

When the information begins to flow back in from the phone calls, the real work begins. Now all of your accounts will have to be re-programmed to include the updates. This is an excellent opportunity to ensure all accounts are programmed in a standard format, and to check the account groups or classifications to make sure they are still valid.

Once your own house is in order, and you truly “know thyself” you can begin to think about incorporating your newly acquired client base. A seller who is motivated to ensure the greatest customer retention should have no problem allowing you to contact the clients you will be acquiring. We recommend a letter signed by both seller and buyer informing the clients of the impending acquisition, and assuring them that every effort will be made to make the transition a smooth one. Tell the clients you will be calling them soon to update all their account information.

At some point when your own house cleaning is moving along well, obtain printed screens from the seller on all your new accounts. Begin the checklist and phone call process with these accounts as well. Programming all your new accounts, with all the right information, in the standard format, well before the “cut” will give your operations staff the necessary training time to become familiar with the accounts long before they begin to receive live calls.

Engaging in this account management process prior to the acquisition solves a good deal of the customer fallout problem. The next two articles in this series will discuss managing employee transitions, and managing pricing changes.

[From Connection Magazine – November 1998]

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