One of our main
objectives in all of the work we do is to build the capability of the
organizations we serve. Much of our work in acquisition integration is focused
deliberately on capability building. We conclude this newsletter by offering
our 5-step plan for building your internal capability to successfully integrate
major acquisitions.
Schaffer
Consulting has built a reputation in acquisition integration based on
groundbreaking work over two decades. Along the way, we have shared our
learning with the business community in a dozen
or more articles on the topic (select “Post-Merger Integration” from the
drop-down). As firms pursue strategies of growing through acquisition, they
often wish to make post-merger integration (PMI) a corporate competency.
Building this competency is one dimension of our consulting practice.
Five steps to developing a corporate PMI
competence
- Agree on the principles of post-merger integration
- Create a disciplined process that is aligned with the principles
- Develop a standard set of tools and methodologies to enable the
process
- Consciously develop a cadre of experienced PMI leaders
- Pilot the approach, learn from the experience, and refine the
process as needed
Agree on the principles of post-merger
integration. You can develop
these principles based on your company culture and operating requirements,
informed by a knowledge of best practices. These principles should cover your
approach to collaborating during the integration, the way you will choose
leaders from both companies to fill the new organization structure, the degree
of transparency you have about decisions throughout the process, the pace of
the integration, and the commitment to goals. A review of corporate policies in
HR, finance, and IT will generate other principles that you may wish to embrace
or modify.
Create a disciplined process. Many
acquisitions get bogged down just when demonstrating tangible progress would
boost morale and commitment of associates. A disciplined process focuses the
organization on goals that are aligned with the deal’s strategic intent,
engages associates in both companies in achieving these goals, and leverages a
governance structure that controls for results and resolves issues quickly.
Project Management Office (PMO) skills are helpful here, but if a PMO is part
of the structure, it should be lean, and accountability for managing and
reporting should rest squarely with the integration teams.
Develop a standard set of tools and
methodologies. Many organizations have one or more methodologies for making
improvements in the business. Sometimes these tools can be helpful time savers
in managing the integration. Care should be taken, though, to avoid overly
analytical frameworks and long cycle time methodologies where rapid achievement
of known benefits is the desired critical path. Select a subset of tools and make them a standard that 
people can learn to use in planning, managing and reporting on the work of
integration.
Consciously develop a cadre of PMI leaders. Beginning with
the next acquisition, be conscious about the selection of leaders and
integration team members for the effort. Typically, people begin by being a
member of an integration team focused on delivering a specific goal within a
specific time frame. People with this experience should be first in line to
lead integration teams in the next acquisition. The best of these, particularly
those with excellent sensitivity to cultural and people issues, and who have
strong relationships throughout your own company, are candidates to be Integration Leaders in a future deal.
Pilot, learn, and refine. Everybody learns
by doing. Employing the principles, processes, tools, and leaders you have
developed will give you the opportunity to test the approach and learn from the
experience. Each of the dimensions of your corporate competency should be
modified as needed to make it more useful in your environment. Make sure there
is a steward for your growing competency who can manage the different elements
of your approach and train new members of the next PMI team.