The Agency Business: Bite reaches out to staff to ensure smooth Applied acquisition

To maintain clients during its acquisition of Applied Communications' US PR business, Bite focused on retaining key employees to offer the same quality of service to clients.

When the news broke last summer that Bite Communications would acquire the US PR business of Applied Communications, it didn't take long for other Bay Area PR firms to start licking their lips over the prospect of poaching Applied's clients and staff. After all, this wasn't a typical acquisition of a larger firm taking on a smaller firm. Bite had about five employees in the US, while Applied had about 40. Such an acquisition was overshadowed by questions about how such clients as VeriSign, BEA Systems, and Wind River Systems would take to such a change, and how the former Applied employees would feel about their culture and name being usurped by that of a much smaller firm. "We knew we were going to have to work hard to market the Bite brand, which we could do once we stabilized the business," says Bite CEO Clive Armitage. "And that meant keeping the clients stabilized, which meant keeping the staff stabilized." Any significant change creates uncertainly and fear, concedes Armitage. And he realized that most of the new Bite employees - coming from Applied - were no doubt "asking what the acquisition meant for them, why should they stick around, what did the new company stand for, what kind of career opportunities would it present," he says. "They had no choice about joining this new company. So we had to really reach out and make them feel good about it." The uncertainty wasn't limited to Applied's employees, adds Armitage. Bite's own pre-merger employees were unsure of what the future held. As Bite recognized last summer, and more and more firms are learning in today's tight job market, success and growth depend not just on hiring the right people, but retaining them, as well. Bite's leadership team spent a lot of time going around and meeting with employees, sitting down and talking to them about what the agency stood for, and providing incentives to stick around by laying out career paths and financial rewards if the agency did well. Clients told the new Bite that they were fundamentally happy with their account teams and that their only concern was losing those teams, says Tim Dyson, CEO of Bite parent company Next Fifteen. By establishing career paths and a future for employees - and, most important, keeping them excited about the agency - Bite had good prospects for keeping clients happy. The company apparently has done that because the previously mentioned clients have all stayed on. "I think that's a tribute to the staff," says Bite VP Judy Wilks. "The [account] teams spent time with clients assuring them and getting their feedback. And those clients said if their teams don't change, then they're happy, and they would stick around and support us." Bite ensured that employees would buy into the new agency by giving them a sense of ownership. The firm created a culture committee with both Bite and Applied employees, who came together to develop a culture that wasn't put together piecemeal from the old US Bite or Applied, but rather was a new entity that all employees could take credit for creating. "It was a collaborative effort," says Armitage. "We wanted employees to be excited about the culture we were creating. We sent some employees to our office in the UK to observe the culture there. We really wanted to give employees an incentive to stick around. And we've had about an 88% retention rate. Employees were our number one priority to making this work." And making the employees the top priority has paid off. Bite introduced itself to the PR community with a party earlier this year that was attended by peers, clients, and the media. And it has since picked up accounts from companies including Sun Microsystems, Applied Materials, and Siebel Systems. The agency's ability to keep its staff and clients happy while winning key new accounts has created an enviable client roster, and created an agency that many peers and competitors recognize as a major player in tech PR. In their own words Three Bite Communications employees on what the agency did right to take it from a tiny boutique to a major player in less than a year:

Karen Duffin, account manager, former Applied Communications employee: "I had to decide whether to take a chance on Bite. And Tim [Dyson] and Clive [Armitage] are the reasons I stayed. They were very enthusiastic about this new opportunity and very realistic about what we should all expect."

Jane Thompson, account director, joined Bite after the acquisition: "I knew Bite from my days in London. I was wowed with what they were doing here. The employees [had] a real opportunity to shape where the firm is going."

Stefanie Wong, account manager, was with Bite before the acquisition: "I was really excited about the acquisition, but also nervous. There were just a few of us, so many of them, and we were acquiring them. It was scary, as we didn't know if we'd be consumed by their culture. But everyone worked together."