Let’s face it, trying to focus attention on post acquisition integration is difficult when planning a merger or acquisition. Companies often overlook the details of integration planning during the heat of the deal making process, as time and energy is spent on due diligence and getting the deal closed-leaving little time for much else.
But according to a recent study the number one cause of deal failure is due to acquiring companies ignoring integration challenges. Companies can avoid this trap by establishing clear integration objectives, by creating concise integration plans and playbooks, and by properly staffing an integration team.
Post acquisition integration plans need to have clear objectives:
• Rapidly capture cost & revenue synergies
• Streamline organization and critical business processes
• Minimize disruption to employees, customers and suppliers
• Execute an issue-free Day One
• Maintain focus on current business
Companies can ensure they realize these goals by creating integration plans, playbooks and by staffing a short term IMO (Integration Management office) to accomplish the following:
• Making sure the acquiring company realizes the goals of their M&A strategy by following through with integration execution
• Creating customized, flexible and scalable integration playbooks.
• Creating detailed operational and functional integration plans with tools, templates and reports to support execution.
• Training and operationalizing an Integration Management Offices (IMO) to help with subsequent integration activity.
Securing dedicated resources to handle integration efforts is also important, as integration deliverables and time requirements are substantial during the initial 100 day period following the deal close, and folks will be hard pressed to properly handle integration duties along with their “day jobs”. One of the most common mistakes companies make is to inadequately staff their integration teams-which often insures a painful, slow and mistake prone integration process.
Creating an Integration Playbook
Integration playbooks are scalable, flexible operational plans that will help your company achieve a smooth integration. Playbooks are fluid, and should continually be optimized by incorporating lessons learned and best practices from previous integrations.
Every company has unique integration needs, so there is no “one size fits all” playbook.
Whether it’s a $15 million or a $36 billion deal-Integrations have common needs which must be addressed with an integration strategy and a post acquisition integration process. Make post acquisition integration planning a priority for your next deal to help realize your M&A business objectives.
Scott Whitaker is President & CEO of Whitaker & Company, Whitaker & Company, Inc., an Atlanta based consulting and project management firm that specializes in helping companies execute growth strategies and solve operational issues. Whitaker & Company offers expertise in Merger Integration and Strategic Positioning & Operations.