Post on 20-Aug-2015
Key Aspects for maximizing Synergies through effective
Post Merger Integration
GPMIP Webinar Series February 20th, 2014
Video of this webinar available on YouTube
Key Aspects for maximizing Synergies through effective
Post Merger Integration
GPMIP Webinar Series February 20th, 2014
Stefan HofmeyerModeratorPartner, GPMIPSan Francisco
About Global PMI Partners
An international services organization comprised of 10 country-based firms
We provide pre- and post-merger integration services (M&A Integration) for mid-size and large scale acquisitions
Training | Advisory | Integration Execution
GPMIP Partner Firms
Our extended network of PMI consultants
Today’s Webinar & Panel Discussion
Scott Whitaker Presenter & PanelistFounder, Whitaker & CompanyGPMIP US Partner
Scott is author of the Merger & Acquisitions Integration Handbook. Serving clients across industries, Scott has over 20 years’ experience in strategic planning and all aspects of M&A integration.
Michiel van der Heijden PanelistGlobal Finance & Operations DirectorMölnlycke Health Care
Michiel is involved heavily in M&A and integration projects and is responsible for valuations of potential M&A targets. Recently he managed an integration of a Polish manufacturer and an acquisition in Germany.
Danny DavisPanelistFounder, DD ConsultingGPMIP UK Partner
Danny is an author, a guest speaker on M&A integration at London Business School and was programme director M&A at Henley Business School. As a lead consultant, Danny has been involved in deals from £5mnto £16bn.
Christophe Van GampelaerePanelistFounder, Integrator InternationalGPMIP Belgium Partner
Christophe started Ernst & Young's transaction integration practice for the Benelux countries before founding Integrator International. He has led multibillion dollar global deals for both integrations and carve-outs.
Thomas KesslerPanelistFounder, Integration SuccessGPMIP German Partner
Thomas has delivered more than 28 integration projects across Europe, North America and Asia. He regularly trains European and South East Asian companies in M&A Integration and is a guest speaker at Zurich University of Applied Science.
Stefan HofmeyerModeratorPresident, ModalMinds Inc.GPMIP US Partner
Stefan has delivered business transformation across 31 clients with focus on extended management and process improvement. He is deeply involved with US / China cross border business development.
Post Merger IntegrationIntroduction
GPMIP Webinar Series February 20th, 2014
Scott WhitakerPresenter and PanelistPartner, GPMIPAtlanta
Integration Activities
Pre-planning• Setting the
Parameters of integration timing, addressing core business strategy issues, if necessary, and securing outside resources
Integration Due Diligence• Securing
background data on all functional business areas and business activity to inform your integration planning
Integration Office Planning• Establishing
an IMO to run your integration project
Execution• All major
integration activities, commencing from day one of your integration to end state
Wrap-up• Post
integration surveys and integration-closing activities
Integration: What Could Go Wrong?
People ExecutionPreparationPreparation
1 1 0
Integration: What Could Go Wrong?
People ExecutionPreparation
• Lack of integration pre-planning• Overpayment for acquisitions• Weak due diligence on people and operations• Overestimated synergies• Lack of shared vision/strategic direction• Low/no integration budget• No integration playbook or consistent approach
Preparation
Integration: What Could Go Wrong?
People ExecutionPreparation
• Cultural conflict• Key talent loss• Lack of attention to people issues during
implementation• Competing priorities• Lack of executive commitment
Preparation
Integration: What Could Go Wrong?
People ExecutionPreparation
• No Integration Management Office or team (or poorly resourced team)
• Ineffective technology integration• Slow pace of integration• No end-state planning• Scope creep
Preparation
PMI Best Practices: Pre-Planning“He who fails to plan is planning to fail”
Pre-Planning is where
integrations are won and
lost
Allocate a minimum 90
days of integration pre-planning prep
Manage the pre-planning
regimen like the execution phase
PMI Best Practices: Pre-Planning“He who fails to plan is planning to fail”
Mobilize your Integration
Management Office 90 days prior to Day 1
Define scope, roles &
responsibilities for IMO leads
Secure resource commitments in advance… clear
the decks!
Develop a strategy & process for
getting information
PMI Best Practices: Pre-Planning“He who fails to plan is planning to fail”
Don’t Minimize Culture and
Change Management Challenges
Confirm cultural differences as
part of operational due-
diligence
Plan communications
for all stakeholders to
Day 1 +90
Make communications everyone’s responsibility
Integrate with the End in Mind
What is the desired experience for acquired employees on Day 1?
- Branding, email addresses, business cards, intranet, etc.
What is the desired End State for customers?
- Customer service, invoices, packaging, etc.
What is the desired End State for other external stakeholders?
- E.g. local communities and charities
- Suppliers, vendors, contractors
Embrace transformation opportunities
- People, process, system upgrades
- Future proofing
Get ahead of critical planning assumptions and desired “end state” for all critical areas of the business
For Integration Success…Focus Here
Integration Success
Integration Support
Resource Augmentation
Systems Integration
Communications
Leverage the Positives
Institutionalize the Approach
Integration Strategy
C-Level Oversight
Resource IMO and critical Functions Properly
Don’t underestimate IT workstream challenges and
timing
Make communication planning a top priority
Clarify Strategy & Business Goals
Create a Playbook
Reward Success
PANEL DISCUSSION
GPMIP Webinar Series February 20th, 2014
Scott Whitaker Founder, Whitaker & Company
GPMIP US Partner
Michiel van der Heijden Global Finance &
Operations DirectorMölnlycke Health Care
Danny DavisFounder, DD Consulting
GPMIP UK Partner
Christophe Van Gampelaere
Founder, Integrator International
GPMIP Belgium Partner
.
Thomas KesslerFounder, Integration Success
GPMIP German Partner
Stefan HofmeyerModerator
President, ModalMinds Inc.GPMIP US Partner
Integration Activities
Pre-planning• Setting
the Parameters of integration timing, addressing core business strategy issues, if necessary, and securing outside resources
Integration Due Diligence• Securing
background data on all functional business areas and business activity to inform your integration planning
Integration Office Planning• Establishin
g an IMO to run your integration project
Execution• All major
integration activities, commencing from day one of your integration to end state
Wrap-up• Post
integration surveys and integration-closing activities
Pre-Planning
• Can you detail how synergies are incorporated in the valuation model?
Pre-Planning
• How are synergy targets derived?
Pre-Planning
• Are there any synergy quick wins that you can find on any integration?
Pre-Planning
• I understand what cost synergies are, but what are growth synergies?
Pre-Planning
• Is there a normal % of cost savings achievable?
Pre-Planning
• What training concepts can be incorporated to make your M&A team more efficient?
Pre-Planning
• At what point is planning started? Who typically takes the first responsibility to act?
Pre-Planning
• What do you consider the top 3 priorities for pre-planning and when should they be completed relative to Day 1?
Integration Due Diligence
• What do I do if we don’t have the resources to deal with a detailed synergy analysis?
Integration Due Diligence
• Are cost and growth synergies both essential to any deal?
Integration Due Diligence
• Who within the business owns the realisation of synergies?
Integration Due Diligence
• How do you handle situations where executive decisions are stalled but needed for planning?
Integration Office Planning
• Communication plans get a lot of attention, but even so what are some of the common mistakes companies make during planning?
Integration Office Planning
• What should be considered when developing a robust framework and methodology?
Integration Office Planning
• What is the optimal reporting structure for an IMO?
Integration Office Planning
• Are dedicated IMO resources typically established or are activities delegated to operational personnel?
Integration Office Planning
• What factors should be considered for cross border transactions?
Integration Office Planning
• What is the typical oversight / reporting frequency to the IMO
Integration Office Planning
• What are some standard best practices for ensuring an issue free Day 1?
Execution
• What can we do if we see that we're failing to realise planned synergies?
Execution
• What is the scope of a synergy template?
Execution
• What sense of urgency should be placed on synergies
Execution
• What are top execution related best practices?
Execution
• How do you balance moving quickly and taking time to ensure the integration is done right? What are related best practices?
Execution
• What audits are performed during M&A integration activities?
Execution
• What are some best practices for integration metrics?
Wrap-up
• At what point should an integration be complete and turned over to operations and general project work?
Wrap-up
• What are some things to watch out for in knowledge transfer?
Thank You!
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