The First 90 Days: Managing People When You Take Over an SME

You spent six months building a financial model for this company. You know the EBITDA margin to two decimal places, the age of the boiler, and which customer accounts for 23% of revenue. On day one, none of that will matter as much as whether you remember the name of the woman who has run the front office for eleven years.

Post-acquisition literature tends to fixate on capital structures and strategic plans. That is not where deals succeed or fail in the first quarter. They succeed or fail in the corridor, at the coffee machine, in the silence that falls when you walk into a room where people were previously talking freely. Every person in that building has spent the weeks since the announcement deciding who you are, what you want, and whether their job is safe. You walk in on day one and all of that ambient anxiety is pointed at you.

Understanding that is the beginning of actually managing it.

You Are Not the Founder. Act Accordingly.

The founder who sold this business spent decades accumulating relational credit with the people in it. They know birthdays, family situations, the technician who had a rough patch three years ago and came back stronger, the salesman who needs to be managed gently because he carries the biggest account personally. You have none of that credit. You have credentials, a mandate, and a plan.

Trying to deploy the plan in week one is a mistake.

Not because the plan is wrong. Because no one trusts you enough yet to follow it willingly, and in an SME, willing cooperation is the only kind that works. You cannot mandate your way to operational excellence in a 40-person business where four people hold all the institutional knowledge in their heads and have not written a process document in their professional lives. You are dependent on them. They know it, even if they would never say so.

The observation-first principle is not a suggestion for the diplomatically inclined. It is the correct operational sequence. You observe before you act because the data room gave you the financials and almost nothing else. You do not yet know which manager is a genuine talent who has been underutilised, which one has been coasting on founder loyalty for a decade, which supplier relationship is actually held together by one person's personal rapport, or which informal hierarchy bears no relation to the formal org chart. You will learn all of this. Give yourself the time to learn it before you start changing things.

The Employees Already Know What's Coming

They know the sector is changing. Most of them knew the founder was getting older and that succession was coming eventually. Some of them are relieved. A few are devastated. Several will have already updated their CVs and are waiting to see whether to send them.

The announcement of the acquisition does not create the uncertainty. It surfaces uncertainty that was already there.

Your first job is to reduce it, not by making promises about job security you cannot guarantee, but by being present, consistent, and predictable. Employees in SMEs have good antennas for management sincerity. A founder who has worked alongside them for twenty years has set a standard of authentic communication that you will be compared to instantly and continuously. Generic reassurances calibrated to sound good will be decoded as exactly that. Specific, honest communication about what you know, what you do not yet know, and when you will have more information is significantly more credible.

Tell them you are here to learn before you lead. Then actually do that.

How to Run Your First All-Hands Without Destroying Trust

Schedule it for the first week. Not day one (you need two or three days of one-on-ones with department heads before you stand in front of the full team), but within the first five working days.

Keep it short. Forty-five minutes is long enough. An hour risks feeling like a performance.

Three things belong in it: who you are in operational terms (not your CV, but what you have actually done that is relevant to running this specific kind of business), what you are committed to finding out before making any significant changes, and how people can reach you directly. That last part is not performative. Give them a real channel, check it, and respond to it. In the first 30 days, a direct message from a floor-level employee to the new CEO that goes unanswered for a week does more damage than almost anything else you could do.

What does not belong in the all-hands: the strategic plan, the growth targets, the digitisation roadmap, or any sentence that begins with "going forward." None of it is credible yet. None of it lands the way you intend. You have not yet earned the room's trust, and announcing strategy to people who do not trust you yet is an exercise in creating resistance, not alignment.

The strategic plan gets its moment in days 30 to 90, once you have built enough relational capital to present it as a direction you developed partly because of what they told you. That framing is not manipulation. It should be true.

To see residents who have completed or are preparing for their acquisitions click here: wadcap.com/residents

The Founder Who Stays On Is a Special Case

Many acquisitions in this segment involve a founder who remains with the business in some capacity during the transition period, either as a formal handover support, or in a commercial or advisory role. Jean-Luc Stavaux at Groupe Jordan, who reinvested and stayed on as Sales and Marketing Director after WAD Capital's acquisition, is one version of this. It is increasingly common in the European SME market precisely because the most valuable asset being transferred often lives in the founder's relationships, not on the balance sheet.

Managing this dynamic correctly is one of the harder things you will do in the first quarter.

The founder's continued presence is an asset to the business. It is also a gravitational field. Employees who are uncertain about you will default to reading the founder's body language for signals about whether to follow your lead. Suppliers who built twenty-year relationships with the founder will call him when they have a problem, even after the handover is complete. Customers who buy partly on personal trust will ask him whether things are really changing.

None of this is malicious. It is just how trust works in businesses that were built on personal relationships.

Your operating principle here is clarity without confrontation. Make the scope of the founder's new role explicit, in writing, before they start. Not because you distrust them, but because ambiguity is the enemy. When a supplier calls the founder to complain about a delivery issue, the founder needs to know clearly whether to handle it, defer to you, or loop you in. When an employee goes to the founder with a performance grievance, the founder needs to know what to do with it. The situations will arise. The answer needs to be agreed before they do.

You also need regular bilateral communication with the founder. Weekly at minimum in the first 90 days. Not a report, a conversation. They built this thing. They have opinions about every decision you are making. Some of those opinions are gold. Some are the cognitive residue of how they ran it for thirty years and are no longer applicable. You need to be able to distinguish between the two, and you cannot do that if the communication only flows one way.

Find out more about Kaeron and Groupe Jordan: wadcap.com/potfolio

Days 30-90: When the Real Dynamics Surface

The first 30 days are characterised by heightened formality. People are on their best behaviour. The difficult manager is temporarily collegial. The team that has a long-running conflict with another department has called a ceasefire. You are not yet seeing the organisation clearly. You are seeing the performance it is putting on for the new owner.

By week five or six, the ceasefire starts to crack.

This is when you find out that the operations manager and the head of finance have not spoken directly for seven months and route everything through a shared assistant. This is when the sales team's number two, who has been with the company since the beginning, starts pushing back in meetings in ways that feel disproportionate to the issue at hand. This is when you discover that the person you identified in week one as your strongest internal ally has a reputation among the broader team that is rather different from the impression they gave you.

None of this is exceptional. It is the normal structure of every organisation that has not been actively managed for conflict. Founders often resolve these dynamics informally and continuously, through presence and authority, without ever naming or addressing the underlying issue. When the founder leaves, the dynamics do not leave with them.

Your job in this phase is to see clearly, not to fix everything immediately. Map the actual power structure of the organisation, which will differ from the org chart. Identify the two or three relationships that have the most structural impact on day-to-day operations. Decide which tensions need active management and which can be left alone for now.

The cultural integration work that happens in days 30 to 90 covers workshops, team sessions, and the formal launch of the post-acquisition strategic plan. Per WAD Capital's programme structure, this phase also includes communicating the new performance framework and KPIs across the organisation. Both are important. But the formal process works significantly better when the informal dynamics underneath it have been mapped and at least partially acknowledged. Running a team alignment workshop across two departments that are actively in conflict will not produce alignment. It will produce a very tense workshop.

The Manager Who Remembers the Old Boss

There will be at least one person in the senior or middle layer of the organisation who is visibly struggling with the change. Not sabotaging, not hostile, just visibly anchored to how things were done before. They will preface observations with "the way we always did it" or "when Jean-Luc was here." They will push back on new processes not because the processes are wrong but because new processes are implicitly a criticism of what existed before, and what existed before was their work.

This person is probably valuable. People who care deeply enough about how things are done to resist change usually care deeply about quality. That is not nothing.

Marginalising them is a common mistake. They have institutional knowledge you cannot replace. More practically, they are a signal sender to the rest of the organisation. If the people who are most obviously loyal to the old way of doing things are sidelined visibly, everyone else draws the correct conclusion: that loyalty and competence accrued under the previous regime is a liability, not an asset. That conclusion will make your next two years considerably harder.

The more productive approach is to involve them explicitly in designing the changes you are making. Not as a courtesy, but because their knowledge of why things were done a certain way is often genuinely useful for understanding which parts of the existing process are load-bearing and which are just legacy habit. The distinction matters more than most new CEOs realise. Ripping out a process that feels inefficient and discovering six months later that it was the mechanism by which three customers' specific requirements were being handled manually is an expensive lesson.

Cultural Integration Is Not a Workshop

Per WAD Capital's post-acquisition programme, days 30 to 90 involve cultural integration activities: workshops, team-building exercises, and training sessions to harmonise cultures. These are the visible, schedulable components of integration. They are not the integration itself.

Culture is changed by what you do consistently, not by what you declare in a session with a facilitator. If you run a values workshop and then make a decision two weeks later that visibly contradicts the values discussed in that workshop, the workshop did not build culture. It built cynicism.

The most effective cultural work in the first quarter is behavioural. Show up at the times and in the places that signal to people that you care about the same things they care about. Walk the floor. Sit in on the sales calls. Know the names of the people in the warehouse. Ask specific questions about their work, not generic ones. "How's the team doing?" produces a generic answer. "That Hendrickse account has been complicated for a while, what does the current status look like from your side?" produces a real conversation, and signals that you have actually been paying attention.

The legacy of what the founder built is also a cultural asset, not an obstacle to be managed around. WAD Capital's approach to stewardship is explicit on this: the history, milestones, and achievements of the business belong in the ongoing story of the company, woven into how new employees are onboarded, how the brand positions itself, and how the team understands where they are going and where they came from. You inherited something that worked well enough to be worth acquiring. Treating it as a blank slate is not ambition. It is waste.

What "Observation First" Actually Means in Practice

Observation-first is sometimes heard as "don't do anything for 90 days." That is not what it means.

It means sequence your actions correctly. Stabilise before you optimise. Understand before you restructure. Build trust before you ask for discretionary effort. None of this prevents you from addressing genuine operational problems that are visible immediately. If there is a cash flow issue that needs urgent attention, you address it. If a compliance risk is active, you fix it. Observation-first does not mean inaction in the face of things that are actually on fire.

What it prevents is the more common failure mode: the new CEO who arrives with a plan, announces the plan in week two, reorganises the senior team in week six, and then wonders at month four why execution is so sluggish and morale is so poor. That failure mode is not caused by a bad plan. It is caused by the correct plan being deployed into an organisation that has not yet been given any reason to trust the person deploying it.

The first 90 days are not just the early stage of running the business. They are the period during which you are deciding, in the eyes of every person in the organisation, who you actually are. By day 90, people will have formed a view that will be very difficult to revise. That view will determine how much organisational energy they give you for the next several years, and how much they hold in reserve.

You have one chance to set it. Most of the work is quieter than you expect.