M&A Integration Processes and Issues
The most important rule in M&A is to ensure that you don’t destroy value, so you have to take the time to build your processes and plan for the eventuality that something goes wrong. From my experience, the most frequent issues are about people – how they react to changes and their reluctance to change and how they respond when something doesn’t go as planned.
We assist our clients in setting up an effective system that allows them to spot problems early and to respond quickly. This can be accomplished by having a weekly IMO meeting and functional work streams to review progress and escalate issues or risks to the SteerCo.
After the process for addressing issues has been established, it’s vital to focus on implementation. This means ensuring that the team knows what it’s expected to accomplish, how that will be measured, and by when. It’s also about clearly defining accountability (i.e. ownership of the end results) and decision making authority for the entire business.
It is essential that the CEO and top managers are able to spend at least 90 percent of their time on the most important issues and not be distracted by integration tasks. A good way to do that is to appoint an effective leader to lead the Decision Management Office (IMO) that can make decisions and oversee the work streams. This could be a person from the organization that acquired the company, or it can be an emerging star within the newly merged company who has the backing of their boss to make this commitment.