In a previous article, I looked at preparing for mergers and acquisitions. Key outcomes identified included managing M&A activities as a project, acknowledging change management as being significant, initiating people and communications plans, and completing due diligence to the best of your ability.
These activities place you in a strong position to proceed if the deal is approved, while also demonstrating your collaborative leadership approach.
The next phase after M&A agreement is reached is integration planning. By this stage, completing the deal has already consumed considerable time and resources, meaning clear and tangible returns are both expected and required.
It is essential you have a clear understanding and agreement with the executive group or delegates on what the success criteria and associated deliverables for integration entails.
If the outcome is to improve capabilities, market share and/or profit with a reduction in some costs, how will your integration plan cover this? Key at this point is clarity and transparency, followed by facilitation of appropriate resourcing and clear and concise communications.
Examples may include:
- Integration of core applications
- Standardisation and/or reduction of key agreements, software and hardware
- Organisational restructure and consolidation
With the integration deliverables agreed, all departments can then collaborate, confirm and communicate the priority project activities that will provide the best value for the organisation. All plans should clearly identify: Value drivers for the business; timings; costs; risk mitigation; and strategic alignment.
This is also the time to determine if all parts of the acquisition require integration; portions may be resold or other services divested.
A review of service support is another component that needs to be considered, as one size may not fit all. Standardisation is often a vital outcome, however you must consider if profitable services will be significantly impacted by these changes.
While developing the integration plan with the business, your three main priorities still remain with people, communication and vendors.
I am a strong believer that people come first. It is essential you are open and transparent, and that communications are aimed appropriately. Addressing the ‘What’s in it for me’ question is very effective, and using a variety of communication methods and tools improves opportunities for people to be engaged.
It is extremely rare for staff to complain about over-communication. Generally, concerns are associated with poor, infrequent or one-way interactions. All that preparation work you did initially on the people and communication will now pay off.
Vendors are another important component of realising M&A success factors, particularly those associated with standardisation. Engage them early and facilitate effective partnerships, remembering to acknowledge those who are responsive, flexible, innovative and supportive of the change. It is also a time to reflect on those who may be opportunistic.
Remember to ensure you accurately track and communicate expenditure, savings, tangible and intangible benefits, and risks. Managing this information as you progress will save you time in the longer term, as this will be required for future consolidated business planning and budget development.
There are many lessons to be learned from undertaking M&A activities and these include acknowledging that there is never a ‘perfect’ deal. However, impact on the organisation can be minimised by identifying people, communication and change management as top priorities.
Ultimately, success is measured by leadership’s ability to understand and craft an implementation plan that delivers the deal value drivers on time and budget, while maintaining efficient and effective business as usual services.
Fi Slaven is a business strategist and service-oriented transformational executive, CIO and management consultant. Fi was Grant Thornton Australia's first CIO, held IT leadership roles with Mayne, Affinity and Symbion Health, and has extensive experience covering all aspects of the IT spectrum. She has also published a whitepaper on Change Management during M&A activity and presents on the topic at business forums.