Nursery Chains: Linked as one

When one nursery group successfully assimilates another a raft of business, management and leadership skills need to be deployed, but the most vital one is effective communication.

Senior figures in the early years sector who have all been closely involved in acquisitions say that above the legal and commercial requirements to be undertaken, it is essential to keep the staff and parents informed.

'You have to communicate well with the staff and parents,' says John Woodward, managing director of Busy Bees. 'You must remember the first thing the parents will do is ask the staff, "Are you happy with this?" Whatever we say, they will always ask the key person, the person who cares for their child and with whom they have built up a relationship. So you have got to be credible with the staff.'

The sentiment is echoed by Alec Hodson, managing director of Complete Childcare, which last year acquired Kingsclere Nurseries. 'Communication is crucial. It is all about the people,' he says.

'Before the sale was agreed, we met the senior team, who were a bit nervous as they had been hearing rumours about the takeover. The outgoing owners introduced us to the staff and for the parents, we sent a joint letter, written and signed by the previous owners, myself and my team.'

Linda Oury, director of operations in Europe for Bright Horizons Family Solutions, also ranks good communication as vital. 'We are proud to say that usually most staff and parents remain with us following an acquisition.

'This is our core focus throughout any integration process. One of our guiding principles is that communication should be at the heart of all we do, and we believe that honest, ongoing conversation with everyone involved in the integration is the key to success. We provide staff and parents with the information they need at each stage of the process, so they know what is about to happen.

'Our particular focus is on centre managers so that they understand what changes will take place, why, and how; that way they can help lead the change with their staff teams.'

Past experience has left Busy Bees with a successful integration plan, as Mr Woodward explains. 'In some ways the past 20 years has made life easier for us. It is simple for us to acquire a nursery and make the staff happy because essentially they know what we are trying to do. People know us well so we can say things like "We are in this for the long term" and "We develop staff and management".

'When Lynn and Margaret Randles went and spoke with the Leapfrog staff they were delighted that Busy Bees had bought Leapfrog because they knew what we are trying to do and they were going to become part of a group that was intent on the quality of childcare.'

Regular contact with staff and parents about the future of the nursery can allay any fears, says Ms Oury. 'We have found that it is most helpful to pace the communication, so that nobody is overwhelmed but is able to focus on what is relevant to them and assimilate the information, knowing who to ask any questions. Trust is an important part of this.

'One very effective way to reassure staff and parents is to set up a team of ambassadors. Each "new" nursery is assigned an ambassador, typically a nursery manager, who is present during the first few days to answer questions, reassure and welcome everyone to Bright Horizons. The relationship between nursery community and ambassador moves into an ongoing friendship and in our experience is very much valued by everyone.'

In harmony

Mr Hodson explains that every nursery acquisition must be treated individually. 'It is always a little bit different to what you expect when you lift the lid, but we have a six-month transformation plan to which we work. The impact of that has been the harmonisation and standardisation of the areas we regard as crucial.

'The term "nursery chain" smacks of McDonalds. We don't want to be McDonalds; actually we don't want to be Pret A Manger either. We are effectively two companies. We give the management team of each unit the ability to put their personal stamp on what they do. We also have an intranet so the managers can access standard procedures and find out how they are performing relative to each other. The key thing is that the manager and management team for each individual unit really defines its success.'

Ms Oury joined Bright Horizons 15 years ago as a result of a takeover so understands the process well. 'Bright Horizons in UK and Ireland has evolved through the addition of legacy companies who have each brought their own contributions.

'Our successful company history of ongoing enrichment through acquisition has given us valuable experience and many insights regarding how best to integrate staff, parents, families and company systems so that everyone experiences a smooth transition while we adhere fully to legal and regulatory requirements and ensure efficient operations.

'Bright Horizons is a network of nurseries, rather than a chain; as such in our Bright Horizons' network each nursery has its own individual personality and strengths while all sharing common values and aspirations for consistently high quality.

'We look for nurseries with similar values to our own, an emphasis on quality of care and on being an employer of choice in the sector. These are key factors in the decision-making process, along with business performance and location.

'To illustrate, there is considerable symmetry between the Bright Horizons' guiding "heart" principles (honesty, excellence, accountability, respect, teamwork) and Teddies' "care" values (caring, accountable, respectful, enabling).'

Mr Woodward says that on acquisition Busy Bees looks at the support each setting needs. 'We examine the staff's qualifications and experience, and look at the support they require.

'We look at the buildings to see if they need an input of capital. If the previous owners have financial worries before they sell the nursery they may cut back on maintenance. Sometimes people cut back on support staff to make the profits look good for that year.

'You look at the equipment in the same way and judge how much you have got to spend. It will be very unusual to buy a nursery that doesn't need money spending on it.'

Doing different

But how quickly does the new senior management team make changes? 'There are legal and practical changes that have to be immediate,' says Ms Oury, 'such as those relating to insurance, registration and payroll. These need to be planned for and implemented swiftly so there is no disruption to the everyday running of the nurseries, and staff and parents' financial arrangements are not negatively impacted.

'There then follows a period of mutual "getting to know you" activity so that the strengths and compatibilities of both companies are identified and ways found to ensure that the best of both systems go forward.

'Since all nurseries will be operating to national standards there will be many common elements and changes are likely to be variations on what are essentially similar activities. We only acquire nurseries who we consider to be "the best" and our aim is to keep that which they do well while adding Bright Horizons enhancements.'

What about rebranding? Mr Hodson says the Kingsclere bunny logo has been retired and instead the two companies use the Complete Childcare kid-chain logo, but that is the only real symbol of corporate identity.

Mr Woodward adds, 'Busy Bees is one of the best known names in the sector. We like our brand, the parents like our brand and it is trusted by staff as well. When we take over a nursery we usually change names more quickly than we used to as previously we were super-cautious and took our time.'