Learn the crucial employee data HR should provide leadership when considering buyers for a divested subsidiary. Census, roles, compensation and more. SHRM-SCP practice question.
Table of Contents
Question
An organization that has decided to sell a long-held subsidiary is considering potential buyers. What information should the HR leader provide to leadership in this phase?
Answer
Employee census for the subsidiary that includes current roles and total current compensation. The value of the workforce that has been selected for divestiture is useful information that HR can provide as the organization is considering target buyers. A total head count along with the current cost of each employee will be needed. This occurs as the second step of the divestiture process, after the candidate for divestiture is identified.
Explanation
When an organization has decided to divest a subsidiary and is evaluating potential buyers, the HR leader should provide leadership with a comprehensive employee census for the subsidiary. This census should include:
- Current roles/positions of all employees
- Total current compensation for each employee (salary, bonus, benefits, etc.)
- Overall headcount
Providing a detailed snapshot of the subsidiary’s workforce composition and total cost is valuable information for leadership as they assess buyer options. Quantifying the value of the workforce being divested in terms of roles and expenses helps inform the evaluation of offers.
This workforce data gathering and sharing occurs in the second phase of the divestiture process, after the subsidiary has been identified as the divestiture candidate. Subsequent steps include announcing the divestiture internally and externally, executing the sale, and conducting any necessary workforce transitions.
In summary, an employee census detailing headcount, roles, and total compensation is key information HR should supply leadership as they weigh potential subsidiary buyers. This supports data-driven decision making during this pivotal divestiture phase.
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