M&A Integration – How To Do It. Planning and Delivering M&A Integration for Business Success de DA Davis

M&A Integration – How To Do It. Planning and Delivering M&A Integration for Business Success

DA Davis

The flurry of M&A deals announced in 2011, including AT&T's agreement to acquire T-Mobile USA, ConAgra's proposed bid for Ralcorp, and eBay's acquisition of GSI Commerce, indicate that M&A has returned, and is perhaps headed back to the levels seen before the financial crisis. Most firms of a certain size will turn to it in their search for growth, forcing almost all managers to face up to the challenge of integration at some point their career. For many managers it is often their first, and only time and M&A is high on the list of things that many managers hate. According to many studies, 50 to 75% M&A transactions turn out to be a failure. One of the main reasons for failure is late or wrong integration or bad integration management. There is a significant demand for more information on best practice in Post Merger Integration. This book intends to equip those managers for the task… Danny Davis demonstrates how to handle the post-merger integration process and show how to restructure, consolidate, reduce costs, create efficiencies and perform M&A, from smaller transactions to mega-mergers. The focus is on integration planning and delivery. The book combines a general/strategic view with detailed information of how to actually conduct a Post Merger Integration via very practical tools and check lists that will prove essential in delivering change before, during and after transactions as well as to ensure their success.

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PREFACE xi ABOUT THE AUTHOR xv INTRODUCTION xvii PART I THE STRATEGIC DRIVERS 1 1 M&A OVERVIEW 3 Chapter summary 3 What types of M&A are there? 3 How much should we pay? 5 Most mergers fail 7 Dene success 10 The M&A process 10 Strategic M&A process 14 Strategy: linking pre-deal and post-deal strategy 15 2 INTEGRATION OVERVIEW 19 Chapter summary 19 Integration objective 20 What is integration? 21 Integration strategies 22 Reason for success 23 Will we succeed? 27 Learning from mergers 28 Different mergers at different stages of the company life cycle 33 What should we expect during the integration? 34 Transforming the business 36 3 PLANNING FOR INTEGRATION 39 Chapter summary 39 Model for integration planning 40 Integration checklist 44 What is 100 day planning? 45 Day 1 58 Information 61 Bringing the companies together 63 Planning for “the dip” in productivity and service 64 Review integration readiness 67 4 INTEGRATION DRIVERS 71 Chapter summary 71 What a re synergies? 72 How deep to cut 74 The principles of integration 75 Budget for integration 83 Integration tracking 85 2nd wave integration 86 5 INTEGRATION GOVERNANCE OR STRUCTURE 89 Chapter summary 89 Put people in place 90 Responsibility and accountability 93 Controls in place at different levels 94 Board tracking of integration 94 Agree reporting requirements 95 Teaching integration in our company 98 Integration standards, tool kits, process 99 Risk workshop and risk management 100 Track progress 104 6 DELIVERY – “INTEGRATION MANAGEMENT” 109 Chapter summary 109 Mobilize a merger team 110 Strategic delivery of integration 110 Roll out new procedures for managing projects 111 Integration Management O= ce 113 Integration management 115 Strategic plans, parallel planning process, detailed plans 120 PART II THE FUNCTIONS 125 7 FINANCE 127 Chapter summary 127 Links with other parts of the integration 128 Finance readiness review 130 Financial integration strategies 132 Learning points for " nance 136 Outsourcing 137 Financial basics 141 Financial risk management 144 Benchmarks, key performance indicators 144 What infrastructure is needed? 145 Finance organization – people 146 Processes and IT 146 8 IT 151 Chapter summary 151 IT perspective day 1 152 Assess readiness for integration 152 IT and integration strategy 154 Reasons for change in IT during a merger 156 Level of integration 157 Links with other parts of the integration 158 Issues during an integration 162 Do the basics 168 Integrate or consolidate systems 172 IT integration success 173 IT integration checklist 177 9 HUMAN RESOURCES 179 Chapter summary 179 HR for the integration (outside HR) 180 HR checklist 199 HR for the HR integration 200 10 COMMUNICATIONS 205 Chapter summary 205 Management communications 208 Communications overview 210 Communications for the whole integration 214 Communications perspective day 1 219 The integration of communications 220 11 SALES AND MARKETING 223 Chapter summary 223 Links with other parts of the integration 226 Sales and marketing overview 227 Brand 235 Culture of sales and marketing 239 Communication planning 240 Integration of sales 241 Integration of marketing 243 Customer perspective day 1 244 Revenue generation 245 12 SUPPLY CHAIN 249 Chapter summary 249 Supply chain perspective day 1 250 Level of integration – how far to integrate 250 Links with other parts of the integration 250 Operating synergies 254 Process review 256 Management controls 257 Supply chain overview 258 Revenue 264 13 HEAD OFFICE AND PROPERTY 267 Chapter summary 267 Head once consolidation 268 Property, level of integration – how far to integrate 269 Property integration 270 14 PROCUREMENT, R&D, LEGAL, HSSE 273 Chapter summary 273 Procurement 273 R&D 277 Legal 280 HSSE (Health, Safety, Security, Environment) 281 15 BOOK SUMMARY 283 Tying it all together 283 The “chain of events” 283 Could we be better prepared for our integration? 284 The killer insights for integration 284 APPENDICES 293 APPENDIX 1 – INTEGRATION TRAINING 295 APPENDIX 2 – CULTURE DIFFERENCE ASSESSMENT 297 APPENDIX 3 – PEOPLE IN THE BOOK 299 INDEX 301

Notă biografică

Danny A. Davis is a guest speaker at a number of the world’s top business schools on strategy and M&A and is a Programme Director at Henley Business School for M&A. He brings a unique background that combines experience as an international sportsman, sales and marketing in large corporate, a strategy consultant and has been involved with integration for two decades. This background means he understands the theory but combines this with a proven ability to deliver M&A integration and large transformations in highly complex organizations. Danny has worked on deals from small to large, with a 100 man company taking over a 25 man, through to $6bn and $16bn deals. His work includes 1-2 days with a client to set up the integration, mobilization workshops and 100 day plans. Through to the actually planning and running of a $6bn deal across 30 countries for 3 years. He also helped manage one of the largest HR transformations on the planet, showing his level of people understanding. Danny has just stepped down from being the youngest ever trustee (Non-Executive Director) on the board of the Chartered Management Institute, also chairing the Marketing and Policy Committee, he currently sits on there “Experts Panel”. He speaks at numerous conferences and recently chaired the M&A integration conference in Europe. He has written articles for Henley Business School, British Computer Society, CFO Europe, Developing HR Strategy, and had a 3 page profile written on him by CIMA magazine for leaders. He brings a blend of strategic theory, practical experience and real life war stories that makes him unique in this field. Danny A. Davis, (MBA Bsc (Hons) DipM MCIM MCMI Cmgr Chartered Marketer) is a partner with DD Consulting, Henley Business School’s Programme Director M&A and helps a large investment fund.