Integration: part 1 - Early days

Despite the challenges posed by rising financial costs and recruitment difficulties, the early years sector is facing unprecedented demand for new acquisitions. Nursery groups put a lot of effort into identifying the right settings in the lead up to an acquisition – but the first few days afterwards are equally as important when it comes to successfully integrating new sites into an existing organisation.

Thrive Childcare and Education owns 46 nurseries across the UK, with its most recent acquisition being The Village Nursery Group, a collection of nine settings in Cheshire and Greater Manchester.

‘On the day of completion, things happen very quickly,’ says Michael Forrester, head of nursery acquisitions at Thrive Childcare.

In some cases, the vendor announces to the team as a whole that the business has been sold only once the legal papers have been signed, while in others, key staff are told weeks or even months before. ‘Involving management early can have huge advantages, as they can help explain the reason for the sale, and help us explain our approach and our intentions, which does reassure staff,’ says Forrester.

Thrive Childcare sometimes builds a post-completion relationship with the departing owner who acts as a consultant during the integration period. ‘We find this useful because the vendor generally has an incredible wealth of knowledge of the sector and their area, which can be useful to our business going forward,’ explains Forrester.

Positive start

New owners need to learn as much as they can about staff at the setting before the day of acquisition, says Ruth Pimentel, chief executive of Kindred Education, which owns 23 settings in London, the South East and South West of England. ‘You need to find out from the exiting owners what the staff are like, how they’re going to react, how long they’ve been there, what sort of role they’ve had, because all that influences how you then integrate,’ she says.

When Kindred bought the Bourne Valley Nursery Group in 2019, managers were invited to a meeting with Pimentel and director of operations and childcare Annie Tierney. They were shown a presentation on Kindred’s mission, values and culture, and given an opportunity to ask questions, before informing their own teams about the sale (see Case study, right).

‘It meant the way in which managers told the staff sold us in a really great light from the start,’ says brand and marketing manager Sarah Fromageot. ‘People were quite excited – they were not thinking, you’re taking away something from us, but actually you’re bringing something in.’

Reassuring staff

Staff sometimes get wind of a sale before it has happened, which can lead to rumour mills going into overdrive. Teams can often spot potential buyers looking around settings, however much they try to disguise themselves as potential parents or ‘a woman from the bank’. Common questions are around job security, pay, holidays and uniform, as well as concerns around potential changes to the setting’s brand and pedagogy.

With retention and recruitment at crisis point in the sector, it is vital for a new owner to reassure and support staff members from day one. The language used is important – Thrive Childcare talks about transition, rather than integration. Claire Sephton, chief operating officer at The Old Station Nursery, says she stresses that new settings are ‘joining us as opposed to being taken over’.

Kindred uses an Inca analogy to make new settings feel they are bringing something to the organisation they have joined rather than disappearing into a faceless corporation. ‘The Incas used to take over all these little tribes, and absorb their gods and traditions and make themselves stronger and stronger,’ says Pimentel. ‘We build the special bits of each nursery into the new Kindred, whether that’s getting even better at staff engagement, or pedagogy, or staff wellbeing, enriching the group as a whole.’

New owners can also highlight opportunities for promotion and development that come with joining a bigger group, and the increased support that teams can access from central services. ‘They often feel like they’ve got a new lease of life, because they have all this head office support – marketing, HR, finance,’ says Pimentel.

While teams often appreciate having access to a range of central services, it is important not to overwhelm them with new contacts in the first few weeks, says Sephton. ‘We give them a dedicated contact, our head of operational projects and transitions, so they don’t have to go through multiple people to resolve any issues,’ she explains. ‘As the transition moves on, we will slowly introduce them to the people who will support them.’

Practical issues

Supporting staff emotionally is vital, but there are also practicalities to think about. ‘On day one, while the priority is sensitivity and empathy, things like passwords and keys that are critical to a running start come a close second,’ says Forrester. The central operations team needs to spend time learning about the new business before acquisition so they can hit the ground running. ‘Often, for example, credit cards are associated with the legacy organisation,’ says Sephton. ‘On day one, the Tesco order that has been set up then doesn’t happen because the credit card has gone with the old owner.’

When it comes to policies and practices, Kindred uses Microsoft SharePoint to share the company’s most up-to-date documents with its new settings. A priority is moving nurseries onto Kindred’s nursery management system. ‘That has to be done quite quickly because we need it for invoicing,’ says Fromageot.

The look and feel of the nursery, however, may take longer to change. ‘We wouldn’t go in and do a massive refurb – there is always some work that needs doing, but we wouldn’t do it straight away,’ says Pimentel.

Kindred takes each case separately, appraising employees’ emotional attachment to their current brand before deciding how and when to introduce a new look. Other chains might change logos and signage more quickly, while some groups do not rebrand at all.

Whatever the approach, the foundation laid in the first few days after the acquisition is made can set the tone for successful integration in the long term.

CASE STUDY: Kindred Winterbourne Earls Day Nursery and Pre-School

Robyn Smith joined a small group of Wiltshire nurseries, operated by Bourne Valley Nursery School Limited, in 2016, becoming manager in 2018. The following year, Kindred Education bought the group from its owners, who were looking to retire.

‘I had suspicions that something was up before the sale was announced,’ says Smith. ‘A Kindred nursery manager came to look round pretending to be a parent but he was asking about staff turnover – parents don’t ask these questions!’

Smith and other managers were invited to a presentation by Kindred chief executive Ruth Pimentel and head of operations Annie Tierney at a local hotel. ‘It was a shock at the time, but I was excited about the new prospects,’ she says. ‘I like to be somewhere where I can grow.’

A week later, Smith was able to inform her team about the sale. Kindred’s sales and marketing manager Sarah Fromageot and Pimentel came to the setting to support her. ‘Some of the team were really shocked, so we sat them all down in small groups and explained what was happening,’ she says.

There were concerns about uniform, as staff would no longer be able to wear jeans, and worries about job security and changes in pedagogy. ‘Kindred was able to assure us that they had chosen to acquire us specifically because our values and aims married with theirs, and that really put people’s mind at rest,’ says Smith.

Each member of staff was given a booklet to welcome them to the Kindred family and explain its ethos. ‘After we had the group discussions, people were generally quite happy: I sold it to them as a really good thing with benefits like support with site maintenance issues, which we hadn’t had before.’

The nursery cook, who was the most resistant to change, met with Pimentel separately to discuss her concerns. ‘Ruth provided her with that additional reassurance she needed, and that she wasn’t able to take from me,’ says Smith. ‘She has now become the biggest advocate for the new group.’

Visually, the first thing that changed was uniform, says Smith, followed by the branding in the nursery. Under the previous owners, staff wore branded coats, which the Kindred uniform did not include, but after a discussion Kindred decided to introduce branded capes. ‘Right from the beginning, Kindred were open to our ideas, and it felt like our voices mattered,’ she says.

All in all, Smith feels the move was a good thing for the setting and for her personally. ‘I have been promoted to senior nursery manager, and I am also the designated safeguarding lead for the company,’ she says. ‘I have my hand in a little bit of everything.’