IT Integration post M&A

Business Situation: Impact of Mergers & Acquisitions

Organizations who go though acquisitions often find it challenging to integrate IT primarily due to two reasons;
· Absence of the tested and formal approach leading to ad-hoc and tactical initiatives
· Size of the integration activity leading to resource crunch and defocused support

Merged entities struggle with issues of high cost of ownership. This is primarily due to duplicate, underutilized and disintegrated applications, with disintegrated data, along with unclear processes. Supporting and maintaining IT becomes expensive which results in lesser budget available for improving the IT (Discretionary spend). A formal approach goes a long way to ensure new merged IT takes the shape based on business integration synergy of entities such as customers, supplier, products, employees etc.

Organization must follow through formal IT integration approaches that can help contain these integration challanges such as retiring duplicate systems, rationalize applications an dinfratsructure, validating IT strategy, Integraing through SOA and putting the right IT governance for successful IT integration and sustainance.

Integration Benefits
· Lower and optimized cost on Non-Discretionary projects
· Rationalization of IT assets resulting in leaner portfolio
· Common key processes resulting in standardization
· Optimum utilization and availability of resources for important activities
· Avoid duplicate investments through cross utilizing available applications, s/w licenses and infrastructure

Questions that must be asked to identify improvement areas
1. Has IT organization gone through formal exercise of identifying business touch points that will have impact on IT?
2. Business focus shifts on new goals after M&A. Has IT already studies and analyzed new business strategy that can be used as reevaluating IT strategy for united organization?
3. Has IT evaluated if it would like to integrate IT or run it as two separate organizations?
4. Is there a need for common processes and hence need for standardizing the applications identified? If yes, has any IT undertaken application portfolio assessment exercise to identify applications that must continue and applications that must retire?
5. Is common support framework (including shared IT services) and service levels identified for effective governance of support?
6. Web/Internet sites are window to customers, suppliers and partners. Has IT prepared plan to merge and rationalize these site? Similarly, intranet sites provide common view inside the organization for effectively communication. Is there any plan to consolidate them?

Answering these questions may help organiztion assess the need. For more information and help, write : dkpr1611@gmail.com