CORPORATE INTEGRATIONS

ADDITIONAL STEPS FOR EFFECTIVELY MANAGING A CORPORATE INTEGRATION

Establishing the Right Team! Once the initial communications have been completed, the next key step is structuring the right integration team. Typically, a “Steering Committee” is set up, an “Integration Team Leader” is named and an “Integration Team” formed. Responsibilities for each includes:

• Steering Committee
  • Establish policy, value drivers and transition principles
  • Approves decisions and monitors progress
  • Meets weekly with Integration Team Leader
  • Assure resources are applied
• Integration Team Leader
  • Manages the various functional subgroups
  • Responsible for the overall success of the integration
  • Works closely with Steering Committee and Integration Team between meetings
  • Primary contact for the integration
• Integration Team
  • Includes individuals from both companies
  • Develops the integration plan and drives execution of the plan
  • Makes decision recommendations on significant issues
  • Ensures the “receiving group” is heavily involved and prepared for the handoff

Although, the Integration Team Leader is usually dedicated full time to managing the integration, often members of the Integration Team retain some of their normal responsibilities and most always the Steering Committee does.

Thus, effectively using an “Integration Playbook” helps the Integration Team Leader project manage the integration, drive to the deadlines and manage communication and ensures that “no stone goes unturned”. It also provides a roadmap and project timeline, a basis for keeping daily updates, visibility to the plan and a vehicle for looking for ways to improve upon the plan.

Hindsight is Always 20-20!  Having a few integrations under our belt, we have learned that it is important to:

• Always use a tried and true “Integration Playbook” to project manage the integration.
• Script the first contact carefully. Prepare answers for the typical “top of mind” issues and don’t make promises you can’t keep.
• Take a few days to name the Steering Committee members, then schedule an offsite within 2 weeks. Be sure to follow legal guidance, especially if a competitor.
• Have the Steering Committee review value drivers, integration principles, process and deliverables. Leave time for socializing & teambuilding.
• Break into functional subgroups, establish clear responsibility at the top quickly and then work down level-by-level naming the people responsible. Keep in mind that “co-executives” never work.
• Control access to the new company. Nobody should contact the new company without approval from the Steering Committee. Start with a very short leash, loosen it as the integration progresses.
• Consolidate voice and e-mail systems as quickly as possible. Accept no excuse for dragging this out. It can be viewed as an early indicator of your capability to do the hard stuff that’s coming later.
• Branding – Don’t drag out name changes. Company name value is usually vastly over-rated and the real value is usually in product names. Eliminate old company names within 6 months and cease transition advertising within 6 months. Change business cards immediately. Use existing inventory of brochures, product literature, etc. as possible, but not more than 6 months.
• Product transitions – Delaying decisions won’t make it better. Give customers enough time for an orderly transition, keep in mind every unit shipped of a “to be discontinued” product is a liability. Provide lots of support for the affected customers and remember this is your problem, not your customers.
• Presence is critical – Balance meetings between where the teams are located; be visible and accessible as it will avoid the “veil of secrecy” perception. People appreciate that every role is important and that needs to be understood during the integration process.

Integrations are difficult! No matter what the size of the company, thus it is important to avoid the following:

• Arrogance – If you believe you have the corner on talent and don’t appreciate the talent that was just obtained, you may lose the very thing you paid for.
• Lacking Credibility – Making quick, big decisions based on perception, not fact is dangerous. Credibility is gained by listening and understanding, even if an unpopular decision needs to be made.
• Too Mechanical – Avoid imposing all policies & procedures without thought. Many a perfectly good business has been buried by the bureaucracy of a new parent. Control the flow of demands on the business, insert only what is necessary and useful. If it is for the “greater good”, make sure people know why.
• Lack of Awareness – There is an underground grapevine, tap into it, and identify the “A” players early. Make sure the top talent is involved in the integration planning and decisions.
• Invasion – Avoid appearing to take over control; remember that they just might know how to run parts of the business better and while some areas are not debatable (like IT, HR and Accounting policies), it is important to involve key and knowledgeable people.

Always remember the value of having an Integration Playbook, augmented by an unbiased third party helping the Integration Team Leader, can be an extremely powerful way to ensure that the integration is on track and successful!

About Us: Racca Solutions Group has lead numerous integration projects as well as supply chain transformation, business profitability optimization, mergers and acquisition due diligence, business integration, and ERP/technology implementation. Interested in learning more please click here.