Communicate to capture fund merger value

If you’re a super fund Chair, Trustee Director or CEO then fund merger may well be high on your strategic agenda. While sealing the deal is no easy matter, the next priority is ensuring the strategic value stays intact by retaining existing members and participating employers.

You may have heard it’s all about stakeholder communication. But what does that mean? Experience from working on five of Australia’s largest fund mergers shows it pays to follow a seven step process.

Step 1: Prioritise Stakeholders

First, ensure you have a complete list of all relevant stakeholders. Ask yourself, who is potentially impacted if we merge? Then prioritise according to how important that stakeholder is to the success of the merger, and how they will view the proposed merger.

If you have individuals or stakeholder groups who are critical to success but not expected to be in favour, it becomes essential to ‘woo and win’ them with extra effort.

Typically members will sit at the top of the list. Consider segmenting your members. Active members and pension members may view a merger differently or you may want to give extra attention to your high account balance members.

Next on your list is likely to be participating employers, again segmented, usually by number of members. Many funds use an account structure so that their largest employers get special attention.

Ensuring the ongoing support of your sponsoring bodies – both employer and union – can be critical to preserving the value of the deal. Board members who have relationships with those sponsoring organisations can play a key role with one-on-one, targeted efforts.

Step 2: Set Success Measures

One communication goal may be to ensure members understand how the merger is in their interests, feel positively or neutral about it, and ‘do nothing’. In this case your success measures may be 100 per cent member retention, no loss of members beyond natural attrition, and achieving positive or neutral feedback through the contact centre and field staff.

Step 3: Consider Relevant Risks

Steps 1 and 2 will typically highlight communication risks. These can be integrated into your overall merger risk plan and assessed according to likelihood and severity, with appropriate mitigation strategies put into place.

Suppose you’ve identified the potential loss of union support, putting in jeopardy the fund’s default status in an Enterprise Bargaining Agreement that is about to be negotiated. Your risk management strategy may include targeting specific individuals within the union and having the CEO and sponsoring body’s Trustee Board members visit.

Step 4: Develop Compelling Key Messages

Your topline merger story needs to spell out the high level benefits the merger
will deliver and why you have chosen that particular partner. Part of the merger story is inevitably about how members win. It needs to be simple to work across all your stakeholder groups. Your topline story then gets ‘topped’ and ‘tailed’ according to the interests of each stakeholder group. For employers, will there be more client managers, improved administration systems, duplicate members merging accounts? Maybe your participating employers already have employees in both funds, so the merger will make their lives easier.

Step 5: Identify Tactics, Tools and Channels

Sometimes this will be about tapping into existing tactics, tools and channels such as your website, contact centre, next scheduled mailout or eDM. For employers, it may be about leveraging your existing account structure and contacts. You may also need to add new tactics, tools and channels such as a specific merger mailout or targeted print or radio advertising or utilise social media channels. If you are the successor fund and not a lot is changing for your members except the fund will grow in size, your announcement won’t need as much effort as it would if your members are merging into a larger fund they don’t know much about.

Step 6: Complete Your Activity Plan and Rollout

If you’ve done your planning thoroughly, everyone involved in the communications effort should be clear about the activity, who is accountable for it, when it happens, the key messages, and any supporting communications pieces required. The most critical part of the rollout is sequencing: who gets told when and ahead of which other stakeholder groups and what do you tell them? You need to balance this with the risk of a leak. Don’t forget that your managers will want to know ahead of their people and they’ll need to be equipped to deal with questions from their direct reports.

Step 7: Refine Ongoing Efforts

This last step is simple but powerful. Don’t forget to include de-briefing on activities and to gather feedback and measure effectiveness as you go during implementation. That way you can refine ongoing communications, improve the effectiveness of your communications and act quickly to adjust as required.

Talking fund merger? Contact Transform CEO and Director, Chris Dvoracek, directly for a confidental conversation about your communication needs on 03 9532 8342.

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