Surviving a merger or acquisition (M/A) is like crossing one of those scary rope brides over a perilous gorge. Okay, maybe it’s not that scary, but there are definitely risks involved, meaning you’d better have a rope bridge that is pretty darn strong. Increasingly, writes Chloe Green of Information Age, that rope bridge is IT.
A Smooth Experience
A central task of management teams during the process of an M/A is to ensure that the restructuring process is an efficient and smooth transition with an eye towards short or medium term return on value. Technology plays a crucial role:
Information Technology (IT) is fast becoming a key lever which management can use to deliver operational benefits, whether in reducing operational costs, entering emerging markets, serving customers in a more profitable manner or scaling their business across multiple geographic regions. With advances in technology and its evolving and significant impact on today’s business models, companies are increasingly pushing the boundaries to remain competitive.
Items may Fall through the Cracks
By embracing IT during the M/A, managers can avoid value instability. By contrast, if IT is ignored, significant and unnecessary costs may be incurred: data migration, business continuity, customer retention are all at risk of falling between the cracks. In some dreadful scenarios, the entire deal may fall to its doom. Remember, IT isn’t going to conveniently disappear during the M/A process, so it’s best to acknowledge its presence, to watch your organizational footing as you cross.
Bring your IT Sherpa
Strategic drivers: product ranges, market share, market penetration, all rely on IT. These transactions can only be serviced if IT has a front-and-center ticket to the M/A experience. In a sense, the CIO is like your Sherpa. Refuse to invite them to the expedition, call upon them on an as-need basis only, and your rope bridge across the M/A just got a little bit shakier.