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December 29, 2022

The integration stage of the deal lifecycle is when teams can achieve a transaction's desired synergies. Even though integration starts post-close, integration planning should begin much earlier in the deal process. In this article, Cara Bibbiani, Senior Director, Corporate Development, M&A Integration at Hewlett Packard Enterprise, discusses how to efficiently execute M&A Integration. 

"You must have a culture of continuous improvement at your company. Understand that feedback is a gift, and you should always be seeking and sharing feedback." - Cara Bibbiani

Partnership with the deal team

In order to reach maximum value-creation, the integration team must work closely with the deal team. Both teams must work side-by-side and learn from each other. During deals, the deal team must involve the integration team early in the process and explain each deal’s strategic rationale.

Conversely, by working together, the deal team will learn how integration has gone in the past and build on those past experiences as they look for future deals. Therefore, the integration and deal teams from both sides must communicate with the buyer and the seller, and each other.

Over at HP, they have a weekly meeting where both teams are present. The deal team talks about their prospects while the integration team discusses their current integration activities. 

Continuous improvement

The landscape of M&A is constantly changing, and what worked years ago might not work today. Therefore, the integration team must continuously improve their process and always be on top of their game. 

According to Cara, feedback is the best way to achieve this. Cultivate a culture of continuous improvement and always make time to review what happened in previous deals. During these meetings, they have ground rules. They want everyone to feel that the feedback meetings are a safe environment where honesty is appreciated. 

  • Nothing is personal. Everything should be based on data and facts.
  • No identifying a particular individual. Everything should be high-level.
  • Share the problem and offer a solution.  

Partnership with business unit leaders

Another key aspect for improved integration is a strong partnership with the business unit leader. The integration team must ensure that the business unit leaders understand that they are also accountable for integration success. 

Here's a checklist that integration leaders must expect from business leaders. The business leaders must be:

  • Aligned with the integration plan
  • Engaged and actively participating in the deal
  • Willing to provide top talent within their unit to work on the deal
  • Accept accountability for the future state of the business
  • Ready to own cultural integration 

Despite popular belief, HR should not always be responsible for cultural integration. For example, in a large company, different businesses have their own culture, which is why the receiving business unit must own its integration. 

Handling incoming people

The people aspect is one of integration's most essential and challenging aspects. The integration team must truly understand what it will take to retain the incoming employees. 

Cara and her team like to use Glassdoor and early surveys to understand what matters to the employees. Find out what would cause people to leave immediately. Also, proactively communicate the integration plan as much as possible with employees. Typically, they are fearful for their job, and learning the integration plan will help calm them down. 

Lastly, be open to reverse integration in the spirit of continuous improvement. There are instances where the target company does things much better than the acquirers. Adapting the target's processes will improve the parent business and show the people that they matter and are a part of the process.

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