Momentum and data/technology success in the post-acquisition phase will be constrained without these two additional success factors.

Commentary by Frank Harris, Strategy Partners Group Founding Partner

For several years now, successful merger and acquisition (M&A) deals have been rapidly increasing in both the number of deals and the financial amounts involved.

As mentioned in this Forbes article from May 2022, “Mergers & Acquisitions: The Secrets to Success,” global M&A volumes reached $5.9 trillion in 2021 reflecting a record growth of a 64% increase over 2020.

We asked one of our founding partners, Frank Harris, to offer his insights on other “secrets” that significantly contribute to the success of an M&A deal. Here is what Frank had to say.

While data/technology and momentum are vitally important to post-acquisition integration success, focusing on these two factors over what could be the more important success factors culture integration and employee engagement can cause a good deal to fail.

Culture and engagement are vital prerequisites to success because the motivation to execute post-acquisition integration must come from within each employee. It cannot be pushed down by management.  No motivation often equals no integration.

While the author is correct that regaining momentum is difficult, having employees who are engaged and culturally aligned with leadership will lessen the chance of losing momentum in the first place and will increase the speed with which it can be regained.

Poor data management and technology integration are harder to recover from than lost momentum. Mistakes or bad decisions made due to inaccurate or incomplete data may take much longer to recover from and are often very costly. Strong planning skills are vital in this factor and, I believe, too often under-resourced during a post-acquisition integration. Hyperfocus on momentum alone may cause shorter planning periods and increase the likelihood of technology-based mistakes.

Fully engaged employees working seamlessly in teams will greatly reduce the common mistakes during technology integration.  Again, creating and integrating culture with engaged employees is a pre-requisite and more difficult task than the data management and technology integration itself.

Mistakes in implementing both of the author’s success factors, momentum and technology, can be more easily mitigated when two companies come together early in the process and define what the combined culture will look like. Establishing and communicating the values, leadership style, teamwork approach and shared goals will allow leadership to merit buy-in from most employees.

Here are more insights and considerations about these “secrets to success.”

Cultural Alignment

Ensuring that the cultures of the two organizations align or can be harmoniously integrated is crucial. Mismatched cultures can lead to employee disengagement, resistance and even attrition, which can hinder the success of integration.

Leadership’s Role

Leadership plays a pivotal role in setting the tone for cultural integration. Leaders need to not only define the desired culture but also lead by example and actively demonstrate the values and behaviors they expect from employees.

Employee Engagement

Engaging employees in the integration process and seeking their input can foster a sense of ownership and commitment to the new culture. When employees feel heard and valued, they are more likely to buy into the changes.

Communication

Effective communication is essential throughout the integration process. Transparent and consistent messaging from leadership can help alleviate uncertainty and anxiety among employees.

Training and Development

Providing training and development opportunities that support the desired culture can help employees adapt to the changes. It is important to invest in programs that help employees develop the skills and behaviors needed for the new culture.

Measuring Cultural Progress

Just as you would track financial and operational metrics, it is important to measure progress in cultural integration. Regular assessments and surveys can provide insights into whether the desired culture is taking root and where adjustments may be needed.

Time and Patience

Changing culture takes time, and it can be a challenging and ongoing process. Patience is key, and leaders should be prepared for setbacks and resistance along the way.

Summary

While momentum and data/technology are undoubtedly crucial aspects of post-acquisition integration, the success of these efforts can be undermined if cultural integration and employee engagement are neglected or under-resourced. In fact, a strong, well-integrated culture can enhance an organization’s ability to address momentum and data/technology challenges more effectively.

By emphasizing the significance of culture integration and employee engagement, they should be viewed as drivers of a holistic integration strategy alongside momentum and technology. Achieving a successful M&A requires careful consideration of all these factors but recognizing that the human element is often the most complex and time-consuming aspect of the process.

Read the original article posted to Forbes as written by Chris Port, COO, Boomi.

About Frank Harris

Frank Harris’s professional background includes a wealth of experience in various aspects of business management, operational excellence and leadership. He has a versatile skill set that spans multiple industries and operational areas. Frank’s approach is centered around helping clients create increased value from their people and operations. Read more about Frank Harris.

Connect with Frank: (770) 718-8290 | /in/frankharris | Schedule a Call