Automation of M&A: Automation of Designing merger integration plans

Design of merger integration plans

While due diligence and dealmaking is well structured domain, the creation and successful executon of merger integrations needs structure and knowledge to be available. Let us have a look at the task of designing merger integration plans, its description and the many questions you should ask when creating such plans.

This is an excerpt of my new book “Automation of Mergers and Acquisitions“. Out soon.

The task has the following goal(s):

Draft integration plan: prepared

The task has the following objectives:

Integration success: maximized
Synergy: maximized
Risk: minimized

Automatability

This task is partially automatable. Project planning applications are available for the 'Design Plan' action.

Task description

The integration plan is created on the basis of the individual integration plan drafts. The drafts for the individual sub-project plans generated in the target due diligence are reviewed and supplemented. The dependencies between the individual integration activities and the resource situation are taken into account. The integration budget required to carry out the project is planned and any risks and their mitigation are documented.

The task works on the following data object types, among others:

Integration project, Integration project plan, Integration Plan Risk, Integration budget, Draft integration project plan, Integration project resources, Organizational plan of the target, Buyer organization, Draft financial integration plan, Task of the draft integration plan for culture, Draft strategy integration plan, Draft production integration plan, Draft plan for future personnel costs, Mapping target jobs to NewCo job descriptions, Draft HR communication plan, Draft HR onboarding plan, Draft HR Training Plan, Draft culture integration plan, Draft tax integration plan, Draft Business Model Integration Plan, Draft Operations Integration Plan, Draft technical integration plan, Draft GTM integration plan, Draft IP Integration Plan, Draft HR Integration Plan, Draft Legal Integration Plan, Draft integration plan for partnerships, Draft IT integration plan, Draft integration plan,

Questions for the execution of the task

The task is executed with the following questions, among others:

Do we want to continue the target business? If so, what are the requirements and non-negotiables to keep the business running?
Do we want to continue the target business models? If so, what are the requirements and non-negotiables to keep the business models up and running?
Do the different parts of the integration plan cover all areas of the business model?
Do we plan changes to the business model of NewCo? If so how should these changes be reflected in the integration plan?
Do the different parts of the integration plan cover all areas of the operations model?
Are changes to the operations model planned? If so how should these changes be reflected in the integration plan?
How do planned synergies influence the NewCo operations model?
Do the different parts of the integration plan cover all areas of strategy?
What are our plans to communicate and implement the NewCo strategy?
What are the steps planned to convert existing strategies for target and acquirer to the NewCo strategy?
Does the production integration plan reflect the goals of the acquisition? How do we make sure we don´t disrupt overall the overall supply chain?
Are changes to the target production model planned? If so how should these changes be reflected in the integration plan?
How do planned synergies influence the NewCo production model?
What should the IT landscape at NewCo look like?
What should the application landscape at NewCo look like?
What are compliance requirements for IT at NewCo?
What changes are needed to the target and acquirer IT functions for NewCo?
What is the impact of planned synergies on NewCo IT and IT integration activities?
Are all end-to-end processes of NewCo supported by end-to-end coverage of applications?
Which data centers or cloud providers should be used and how do we establish the NewCo IT operations?
Do the different parts of the integration plan cover all areas of HR?
What is the impact of planned synergies on NewCo HR function, HR strategy and policies ?
How is employee communication planned?
How are benefits transferred from target to NewCo?
Which HR processes will be established at NewCo and in which steps?
Which HR applications for payroll, hiring etc. will be established?
How will the NewCo organization and its organizational units look like and what are the steps to establish them?
How do we plan to track employee satisfaction and feedback?
How do we intend to communicate elements of the NewCo culture?
What are appropriate steps to establish the GTM strategy, function and applications for NewCo?
What dependencies exist between the parts of the integration plan?
Which changes in the buyer and target since the due diligence are to be taken into account in planning?
What risks do we see for the implementation of the plans and how do we intend to mitigate them?
How do we plan to react to changes outside of NewCo during the implementation of the plan?
How do we plan to react to changes outside of NewCo during the implementation of the plan?
How do we plan to react to changes inside of the acquirer during the implementation of the plan?
How do we plan to react to changes regarding customers during the implementation of the plan?