A cardinal rule in M&A is to avoid destroying value, which is why you need to take the time to create your processes and plan to deal with the possibility of things going wrong. From my experience, the most frequent issues are around people, how they react to changes and their reluctance and how they respond when something doesn’t work the way they expected.
One of the most important things we do for our clients is to assist them in setting up a procedure that allows them to recognize potential issues early and respond to them quickly. That can mean for instance, having weekly meetings where the IMO and functional work streams examine progress against the plan and escalate risks and issues to the SteerCo.
Once the method for tackling issues is in place, it’s important to focus on the execution. It’s essential to ensure that everyone in the team knows what they are expected to do and how they will be evaluated and when. It also includes clearly publishing accountability (i.e., ownership of end results) and the authority to make decisions for the entire integrated company.
It is crucial that the CEO and other senior managers are able to spend at least 90 percent of their time in the core areas and not be distracted by integration tasks. A great way to do that is to appoint a strong leader to lead the Decision Management Office (IMO) which will help triage the decisions and manage the work streams. It could be someone from the acquired organization, or it can be a rising star within the merged company who has the support of their boss who is willing to make this commitment.
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