Post-merger Integration is a highly complex process. It requires swift action as well as running the core business activities simultaneously. There is no one-size-fits-all approach to a successful PMI Process. However, careful planning focusing on the strategic objectives of the deal and the identification and capturing of synergies will help maximize deal value.
It is inevitable that some elements of information will be withheld from a Buyer pre-deal. Further, not all the synergy benefits originally identified in the deal will prove to be achievable. The foremost challenge for management at the onset of the PMI process is to identify how value can be captured from the newly combined organization via synergies and cost savings.
Understanding Post-merger Integration
Post-merger Integration is the fundamental stage of realizing the value of an M&A deal. A highly complex process, it entails bringing together 2 companies experiencing change while ensuring that business continues as usual. A truly challenging undertaking that must never be underestimated.
When 2 companies agree to undertake a Post-merger Integration, its primary objective is to maximize synergies to ensure that the deal lives up to its predicted value. It is a phase during which the results of the Buyer’s M&A strategy and expectations for the closed deal start to materialize.
In the entire phase, Closing and Day One of change is the most critical. It is the initial starting point towards the change of ownership and where Strategy Development is at its core.
Closing and Day One
During Closing and Day One, Managers must focus on 3 important areas.
- Communications. Corporate Communications must be well planned and well implemented. This is to enable managers to lead an M&A project more effectively. Through structured communication, trust is built, motivation developed, and important information shared. In fact, it can prevent the negative impact of rumors and unify the different parts of the joint company.
- Operating Structure. New operating structures and systems are made once the joint company’s strategy and goals have been agreed upon. From Day One, it is important that new management and operational structure/reporting procedures are clearly communicated. In the development of the operating structure, it is important that a CEO has been appointed, the key personnel roles decided, and there is already an agreement on operative and statutory structures.
- Systems & Controls. A clear and detailed Systems & Controls must be established by Day One. This is essential for management to be able to gain control of the operations of the Target. If operational structures are not finalized at this point, a temporary management system and control need to be established.
The Important Role of a CEO and Key Personnel from Day One
The CEO plays a vital role in the joint business. The CEO or Managing Director is involved in the acquisition process. Hence, it is important that from Day One, a CEO or Managing Director has already been appointed.
Often the CEO comes from the Buyer or its group or corporate entity. If an existing CEO of the acquired entity continues the same role, then the Buyer must nominate a controller to ensure financial integration and smooth reporting.
The Key Personnel is also essentially important from Day One. In fact, there is a need for positions and roles of key personnel during the integration process to be planned in advance and communicated at closing.
Interested in gaining more understanding of PMI Day One Activities? You can learn more and download an editable PowerPoint about Post-merger Integration (PMI): Day One Activities here on the Flevy documents marketplace.
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In today’s business environment, management consulting firms must be ready to address client challenges and needs that will transform their business by 10 or 100 times. Tools and methods must be scaled up to ensure applicability to the widest possible audience globally.
The Consulting Workshop Series provides a good understanding of the 10 methods of conducting Workshops that are custom designed to fit specific workshop objectives. Different methods are developed for the purpose of providing organizations the most appropriate tool necessary to support organizations to achieve their strategic goals and targets.
If it is the management’s goal to expose all opinions and options regarding a complex issue, then the Delphi Workshop Method is the perfect approach to undertake. By using Delphi, organizations can gain the benefits of pooling and exchanging opinions to learn from other’s views.
Understanding Delphi as a Consulting Workshop Series Method
Delphi is a structured communication technique originally developed as a systematic interactive forecasting method that relies on a panel of experts. Its main objective is to expose all opinions and options regarding a complex issue.
Delphi is most effectively used in technology forecasting, as well as business forecasting such as sales of new products. It is used in the implementation of multi-stakeholder approaches for participating policy-making. It is also effective in patent participation identification and public policy issues such as economic trends, health, and education.
A dialectical process, it has been designed to provide the benefits of pooling and exchanging of opinions to learn from other’s views.
Discovering the Delphi Approach
- The Conventional Delphi. Called a pen and paper Delphi, it is aimed at a consensus of the most probable future by iteration. It has three main characteristics: the anonymity of the participants, the structuring of information flow, and regular feedback. These three key characteristics help participants focus on the issues at hand.
- The Policy Delphi. The Policy Delphi is a tool for analysis of policy issues. It is employed to generate the strongest possible opposing views on the potential resolutions of a major issue. Generating a consensus is not its primary objective and survey questionnaires are given greater emphasis.
- The Delphi Conference. A Group Delphi, it allows for more discussions and debate. In the Delphi Conference, participants forego anonymity. Time constraints may require a fixed number of cycles and consensus can be increased from one to two rounds of voting. The Delphi Conference often takes less time than the traditional Delphi.
In undertaking the Conventional Delphi, the Policy Delphi, and the Delphi Conference, organizations must be keen on following the right procedure in undertaking any of these Delphi. Because of its different approaches, the steps that are undertaken also varies. Taking the right step is necessary for better understanding and clarity of flow, as well as optimizing the use of Delphi in achieving the appropriate results at the end of the activity.
Interested in gaining more understanding of the Delphi consulting workshop method? You can learn more and download an editable PowerPoint about Consulting Workshop Series: Delphi here on the Flevy documents marketplace.
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