Chapter 4: The Agile M&A Process Model

Day One

The next phase of the M&A lifecycle, the formal integration process, begins on “day one.” Following the successful execution of pre-integration, integration should be starting off on the best possible footing: with a clearly defined vision of the target asset, and a detailed blueprint for the integration process. No matter the size of the transaction, the post-merger integration process invariably entails more work, more dedicated personnel, and a much greater degree of operational complexity than diligence.

The integration process commonly involves numerous teams working simultaneously to integrate different functions. Keeping all of these teams aligned, within scope, and on schedule presents a serious managerial undertaking — and, in general, integration specialists talk and think about project management far more than do their colleagues in corporate development.

In companies with an established integration management strategy, a department called the Integration Management Office (IMO) usually coordinates large integrations involving multiple functional teams. In other cases, the IMO is a temporary project management office created to oversee the integration process, set up during diligence at LOI, or sometimes even earlier in the process. Serial acquirers, however, often have a permanent IMO running continuously. The IMO owns the integration plan, coordinates the different teams involved, manages cross-functional dependencies, and tracks the progress of the project as a whole.

As the driving force behind the process, the IMO plays a critical role in the Agile M&A Process Model. The IMO owns the integration charter and is responsible for coordinating the tactical teams completing the step-by-step checklists. A well-run IMO helps to keep the project on target, reduce dependency issues, enable ground level teams to creatively solve emerging problems, and generally maximizes the likelihood that integration projects realize their True North objectives.

The deal team establishes and runs the IMO, and, as previously described, the deal team is composed of the integration lead and functional experts representing the different workstreams impacted by the integration initiative. In theory, each of these experts also serves as the team leader of the functional group in charge of completing the checklist covering their workstream. This creates a hierarchical structure ensuring strategic decisions are made by a team with comprehensive, up-to-date knowledge of tactical conditions and challenges on the ground level.

Both the IMO and functional teams can support efficient workflow and alignment by fielding the same plays used by the deal team during diligence. Since the scale of the integration project is so much larger than the diligence project, however, the plays must be scaled up as well.