This is part 1 of a series of 4 discussions on the intensity that is associated with acquisition integrations.
If you are about to acquire a company, the transaction, or “deal” is not the end of the acquisition: it is the end of one phase and the beginning of the next, the integration. Integrations are where the value of the deal is realized. Integrations are not easy. They are complex, political, emotional, and very busy.
Let’s not confuse lots of activities with complexity. The main reason for integration complexity is the dependency upon other people, teams, committees, partners, or external contacts to deliver information or complete other tasks.
A spreadsheet can make tasks look clean and simple, but a project description like: “migrate to one payroll system” belies the complexity of the work ahead. When it is time to do the integration of the payroll systems, a few of the tasks involved, and their dependency, could include:
- How often are people paid, and are there any legal requirements on the frequency of compensation?
- [Legal team and local laws issue]
- When we transition employees who are paid twice per week, to being paid once per month, we will have to pay them a carry-over amount. Is the Steering Committee OK with this expenditure?
- [Steering Committee issue]
- Where is the budget to pay them the carry-over?
- [Finance issue]
- We require a definitive list of who gets paid what, what their vacation accrual is, and their benefits are. Who will validate the list and do a dry run?
- [HR issue]
- Do we have the IT capability and contracts in place for the system to run larger payroll?
- [IT issue]
When you integrate an acquired business, you are affecting every department at the same time. This diagram shows the interdependencies for a small business integration, when one workstream is dependent upon another. Note: these are just interdependencies, not a complete list of tasks.
It takes a certain type of person
Making rapid forward progress on an integration is not straightforward. The Acquisition Integration Manager is a pragmatic, organizer, communicator, facilitator with the ability to shepherd an integration to success. He/she could be an employee who has the ability and bandwidth to lead an integration, or they could be an external advisor who either leads or assists the leader(s) of the integration.
Choose carefully who will lead your integration. Do they have the diplomatic, flexible, and driven skills to make your acquisition a success?
Contact Intista if you need help profiling and selecting your Acquisition Integration Manager.
If you are short on resources or need a mentor for your Integration Manager, we can also help you out.