Many of our clients wish to build more robust internal merger and acquisition capabilities to support growth ambitions and make M&A strategy & execution a core competency of their organizations. Our M&A Capabilities service offerings help clients become better at handling integrations “in-house”, and we gladly support their ambition via our service offerings.
Many times we are asked to assess how clients are handling integration or carve-out work internally, and provide an assessment so they can address gaps and prioritize areas of improvement.
Our clients will ask us “when will we know we are ready to handle this internally and do it well?”
The following are some key questions to assess your in-house PMI capabilities:
Is the level of planned M&A activity enough to justify a focus on improving internal capabilities?
If M&A activity is sporadic and an “every few years” type of event, there will be little internal interest in spending much time and resources to improve capabilities. If the corporate growth strategy is dependent on acquisitions and there is planned activity, then it’s easier to make the business case for investing in a more robust internal competency.
Have you identified and are you tracking key KPIs relative to your M&A efforts?
Examples include: synergy goal realization, client retention, employee retention, meeting deadlines for systems integrations and conversions. Many metrics are dependent on the transaction specifics but the key question remains “are you tracking them and do you know what integration success looks like?” .
Are you utilizing a standard process and tool to manage integration activity?
Have you standardized your approach for: pre-planning, governance, roles & responsibilities, day 1 communications, functional workplan mandatories, standardized tool & templates, etc. When every effort seems like a reinvention of the M&A wheel, it’s a sure sign your process discipline is lacking.
Is senior management committed to getting better?
Is the c-suite interested in getting better and improving results? Will they demonstrably support any improvement efforts? Will they themselves adhere to a more process driven and disciplined approach?
Do you know what great M&A planning and execution looks like?
Are you benchmarking your efforts against integration best practices, and are you continually gaining knowledge in this area to help build your internal capabilities? Continuous improvement of internal capabilities is important for any discipline, especially M&A.
If you’re answering a firm “yes” to the questions above, then congrats. You are on your way to building a robust internal competency for M&A integration!
Scott Whitaker is a Partner with Global PMI Partners – an international consultancy of seasoned post-merger integration experts that help mid-market companies around the world bring their operational, technical and cultural differences into alignment.
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