Acquirers must execute quickly and efficiently, navigate changes, and preserve the target company's value. This article will discuss accelerating M&A integration, featuring Caroline Jones, Senior Director - Acquisition Success at Cisco.
"It doesn't matter how quickly we accelerate the execution on our side. We could have offers and products ready to be sold, but it takes the go-to-market teams being ready for integration to be successful." - Caroline Jones
At Cisco, before they commit to a deal, they consider what the integration would entail. Knowing the strategy behind the integration helps their team identify the following:
The integration team becomes involved as soon as Cisco’s corporate development team decides to move forward with the deal. Everyone must align with the integration's strategy, even at a high-level, including their COO and CFO.
In parallel, they have a COO commitment process to align with operations and a CFO commitment process to get final approval. Therefore, they must have a pre-approved team in place that is ready to execute on day one.
During diligence, the target company can become overwhelmed by different teams asking for large amounts of information. Also, this often results in redundant questions that will waste time and cause burn out. At Cisco, they use a pillar model that uses broad organizations instead of functional teams, which includes:
They have these primary teams to do the diligence work and cross-share information with other functions to avoid redundancies. The pillar model also simplifies the functional model and makes understanding the target company easier.
The execution team needs to have experience. The leadership team must also help and anticipate roadblocks during integration so that the execution team can address them as quickly as possible.
Lastly, it doesn't matter how quickly the integration team can execute their plan if the go-to-market team is not ready for the integration. Ensure that the sales team is prepared to sell by providing the right incentives and tools to set them up for success.
To accelerate the pace of integration, everyone must learn from past deals. Whether it's an in-house deal or someone else's deal, understand what went wrong and what went right.
The most successful integrations focus on the people side of the transaction. Many things don't show up on diligence and can only be identified by forming relationships with the target company.