M&A Integration E-Book

Danny A. Davis

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 370

Veröffentlichungsjahr: 2012

Beschreibung

Most firms of a certain size will turn to Mergers & Acquisitions in their search for growth, forcing almost all managers to face up to the challenge of integration at some point in their career. For many managers it is often their first and only time, and M&A integration is high on the list of things that many managers need to learn more about. According to many studies, 50 to 75% M&A transactions fail to deliver their expected value. One of the main reasons for failure is late or wrong integration, or bad integration management. There is a significant demand for more information on best practice in Post-Merger Integration. This book intends to equip those managers for the task... Danny A. Davis demonstrates how to handle the post-merger integration process and show how to restructure, consolidate, reduce costs, create efficiencies and perform M&A, from smaller transactions to mega-mergers. The focus is on integration planning and delivery. The book combines a general/strategic view with detailed information on how to actually conduct M&A Integration via very practical tools and check lists that will prove essential during pre-deal M&A integration planning and Post deal delivery, as well as to ensure their success.

Leseprobe

Table of Contents

COVER

TITLE PAGE

COPYRIGHT PAGE

PREFACE

WHAT THE BOOK COVERS

WHO THE BOOK IS FOR

HOW THE BOOK IS STRUCTURED

ABOUT THE AUTHOR

INTRODUCTION

PART I: THE STRATEGIC DRIVERS

CHAPTER 1 M&A OVERVIEW

CHAPTER SUMMARY

WHAT TYPES OF M&A ARE THERE?

HOW MUCH SHOULD WE PAY?

MOST MERGERS FAIL

DEFINE SUCCESS

THE M&A PROCESS

STRATEGIC M&A PROCESS

STRATEGY: LINKING PRE-DEAL AND POST-DEAL STRATEGY

CHAPTER 2 INTEGRATION OVERVIEW

CHAPTER SUMMARY

INTEGRATION OBJECTIVE

WHAT IS INTEGRATION?

INTEGRATION STRATEGIES

REASON FOR SUCCESS

WILL WE SUCCEED?

LEARNING FROM MERGERS

DIFFERENT MERGERS AT DIFFERENT STAGES OF THE COMPANY LIFE CYCLE

WHAT SHOULD WE EXPECT DURING THE INTEGRATION?

TRANSFORMING THE BUSINESS

CHAPTER 3 PLANNING FOR INTEGRATION

CHAPTER SUMMARY

MODEL FOR INTEGRATION PLANNING

INTEGRATION CHECKLIST

WHAT IS 100 DAY PLANNING?

DAY 1

INFORMATION

BRINGING THE COMPANIES TOGETHER

PLANNING FOR “THE DIP” IN PRODUCTIVITY AND SERVICE

REVIEW INTEGRATION READINESS

CHAPTER 4 INTEGRATION DRIVERS

CHAPTER SUMMARY

WHAT ARE SYNERGIES?

HOW DEEP TO CUT

THE PRINCIPLES OF INTEGRATION

BUDGET FOR INTEGRATION

INTEGRATION TRACKING

2ND WAVE INTEGRATION

CHAPTER 5 INTEGRATION GOVERNANCE OR STRUCTURE

CHAPTER SUMMARY

PUT PEOPLE IN PLACE

RESPONSIBILITY AND ACCOUNTABILITY

CONTROLS IN PLACE AT DIFFERENT LEVELS

BOARD TRACKING OF INTEGRATION

AGREE REPORTING REQUIREMENTS

TEACHING INTEGRATION IN OUR COMPANY

INTEGRATION STANDARDS, TOOL KITS, PROCESS

RISK WORKSHOP AND RISK MANAGEMENT

TRACK PROGRESS

CHAPTER 6 DELIVERY – “INTEGRATION MANAGEMENT”

CHAPTER SUMMARY

MOBILIZE A MERGER TEAM

STRATEGIC DELIVERY OF INTEGRATION

ROLL OUT NEW PROCEDURES FOR MANAGING PROJECTS

INTEGRATION MANAGEMENT OFFICE

INTEGRATION MANAGEMENT

STRATEGIC PLANS, PARALLEL PLANNING PROCESS, DETAILED PLANS

PART II: THE FUNCTIONS

CHAPTER 7 FINANCE

CHAPTER SUMMARY

LINKS WITH OTHER PARTS OF THE INTEGRATION

FINANCE READINESS REVIEW

FINANCIAL INTEGRATION STRATEGIES

LEARNING POINTS FOR FINANCE

OUTSOURCING

FINANCIAL BASICS

FINANCIAL RISK MANAGEMENT

BENCHMARKS, KEY PERFORMANCE INDICATORS

WHAT INFRASTRUCTURE IS NEEDED?

FINANCE ORGANIZATION – PEOPLE

PROCESSES AND IT

CHAPTER 8 IT

CHAPTER SUMMARY

IT PERSPECTIVE DAY 1

ASSESS READINESS FOR INTEGRATION

IT AND INTEGRATION STRATEGY

REASONS FOR CHANGE IN IT DURING A MERGER

LEVEL OF INTEGRATION

LINKS WITH OTHER PARTS OF THE INTEGRATION

ISSUES DURING AN INTEGRATION

DO THE BASICS

INTEGRATE OR CONSOLIDATE SYSTEMS

IT INTEGRATION SUCCESS

IT INTEGRATION CHECKLIST

CHAPTER 9 HUMAN RESOURCES

CHAPTER SUMMARY

HR FOR THE INTEGRATION (OUTSIDE HR)

HR CHECKLIST

HR FOR THE HR INTEGRATION

CHAPTER 10 COMMUNICATIONS

CHAPTER SUMMARY

MANAGEMENT COMMUNICATIONS

COMMUNICATIONS OVERVIEW

COMMUNICATIONS FOR THE WHOLE INTEGRATION

COMMUNICATIONS PERSPECTIVE DAY 1

THE INTEGRATION OF COMMUNICATIONS

CHAPTER 11 SALES AND MARKETING

CHAPTER SUMMARY

LINKS WITH OTHER PARTS OF THE INTEGRATION

SALES AND MARKETING OVERVIEW

BRAND

CULTURE OF SALES AND MARKETING

COMMUNICATION PLANNING

INTEGRATION OF SALES

INTEGRATION OF MARKETING

CUSTOMER PERSPECTIVE DAY 1

REVENUE GENERATION

CHAPTER 12 SUPPLY CHAIN

CHAPTER SUMMARY

SUPPLY CHAIN PERSPECTIVE DAY 1

LEVEL OF INTEGRATION – HOW FAR TO INTEGRATE

LINKS WITH OTHER PARTS OF THE INTEGRATION

OPERATING SYNERGIES

PROCESS REVIEW

MANAGEMENT CONTROLS

SUPPLY CHAIN OVERVIEW

REVENUE

CHAPTER 13 HEAD OFFICE AND PROPERTY

CHAPTER SUMMARY

HEAD OFFICE CONSOLIDATION

PROPERTY, LEVEL OF INTEGRATION – HOW FAR TO INTEGRATE

PROPERTY INTEGRATION

CHAPTER 14 PROCUREMENT, R&D, LEGAL, HSSE

CHAPTER SUMMARY

PROCUREMENT

R&D

LEGAL

HSSE (HEALTH, SAFETY, SECURITY, ENVIRONMENT)

CHAPTER 15 BOOK SUMMARY

TYING IT ALL TOGETHER

THE “CHAIN OF EVENTS”

COULD WE BE BETTER PREPARED FOR OUR INTEGRATION?

THE KILLER INSIGHTS FOR INTEGRATION

APPENDIX

APPENDIX 1 – INTEGRATION TRAINING

APPENDIX 2 – CULTURE DIFFERENCE ASSESSMENT

APPENDIX 3 – PEOPLE IN THE BOOK

INDEX

This edition first published 2012

© 2012 John Wiley & Sons Ltd

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Library of Congress Cataloging-in-Publication Data

Davis, Danny, 1972–

 M&A integration—how to do it : planning and delivering M&A integration for business success / Danny A. Davis.

p. cm.

 Includes index.

 ISBN 978-1-119-94486-7 (cloth)

1. Consolidation and merger of corporations. 2. Consolidation and merger of corporations—Management. I. Title.

 HD2746.5.D384 2012

 658.1'62–dc23

2012017208

A catalogue record for this book is available from the British Library.

ISBN 978-1-119-94486-7 (hardback) ISBN 978-1-118-36124-5 (epdf)

ISBN 978-1-118-36125-2 (epub) ISBN 978-1-118-36123-8 (emobi)

Cover design: www.specialdesignstudio.com

PREFACE

WHAT THE BOOK COVERS

In the world of mergers and acquisitions (M&A) much emphasis is put on the identification of targets and the closing of the deal. Integration and consolidation are issues that are often not addressed early enough, if at all.

Organizations put much effort into thinking strategically about what they will buy and why, but the thinking often doesn’t flow through into the task of planning how the actual integration will take place. This phase is, however, critical to success. Figures show that 80% of mergers fail. The reasons for this are complex and varied, but failure to pay proper attention to the integration process is often a key factor.

Every business function within an organization is affected by a merger and each will need to think strategically about the implications for their work and the processes they will need to employ to drive the necessary changes forward successfully.

In this book I will take you through the deal process, integration planning (otherwise referred to as 100 day planning) and final delivery. The chapters include tools and checklists that will prove invaluable in delivering the changes and improvements you are planning.

Throughout the book I use the shorthand of “merger” for merger, acquisition, takeover or any sort of joining of entities – be they public, private or third sector. Government departments may refer to these as change or transformation programmes, but these improvement and efficiency drives are essentially all types of mergers which call for a structured approach to integration.

WHO THE BOOK IS FOR

All managers will go through some sort of integration during their career. Whether this is a merger or acquisition, an internal restructure is where we see business units being pulled apart (de-merged), moved around and then put together in a different order (integrated). Managers will also go through some sort of consolidation where there is overlap and duplication; in essence these projects or changes are very similar to the integration or restructuring we may see happening during a merger.

The approach and thinking are appropriate across corporate sectors, government and non-profit organizations.

HOW THE BOOK IS STRUCTURED

The book is split into two parts.

The first links strategically the pre-deal and post-deal activity. It looks at how to move from the strategy through to the realities of delivery, covering the drivers, governance and structure, as well as how to manage the integration. Some new and unique models and checklists are included, together with tools that can be used across the whole of the integration.

The key chapters look at:

M&A overview

Integration overview

Planning for the integration

Integration drivers

Integration governance or structure

Delivery – “integration management”

The second part of the book goes through each of the business functions, starting with high-level thinking and direction, then moving on to look at the strategic drivers of integration, with tools and checklists on how to deliver.

I look closely at the back office functions of Finance, IT, HR and Communications. These are always considered in all mergers, even if the decision is to do nothing. I then move on to look at the other functions, paying special attention to the linkage between them, which is an important factor within large complex integration programmes.

The second part of the book contains the following chapters:

Finance

Information technology (IT)

Human resources (HR)

Communications

Sales and marketing

Supply chain

Head office consolidation

Property

Procurement

Research and development (R&D)

Legal

HSSE (Health, Safety, Security, Environment)

ABOUT THE AUTHOR

Danny A. Davis is a guest speaker at a number of the world’s top business schools on strategy and M&A and is a Programme Director at Henley Business School for M&A. He brings a unique background that combines experience as an international sportsman, sales and marketing in large corporations, a strategy consultant and involvement with integration for two decades. This background means he understands the theory but combines this with a proven ability to deliver M&A integration and large transformations in highly complex organizations.

Danny has worked on deals from small to large, with a 100 employee company taking over a 25 employee, through to $6 bn and $16 bn deals. His work includes one to two days with a client to set up the integration and mobilization workshops and 100 day plans, through to the planning and running of a $6 bn deal across 30 countries over three years. He also helped manage one of the largest HR transformations on the planet, showing his level of people understanding.

Danny has just stepped down from being the youngest ever trustee (non-executive director) on the board of the Chartered Management Institute; he also chairs their Marketing and Policy Committee, and currently sits on the “Experts Panel”.

He speaks at numerous conferences and recently chaired the M&A integration conference in Europe. He has written articles for Henley Business School, British Computer Society, CFO Europe, Developing HR Strategy, and had a three-page profile written on him by CIMA magazine for leaders.

He brings a blend of strategic theory, practical experience and real-life war stories that makes him unique in this field.

Danny A. Davis (MBA, BSc(Hons), DipM, MCIM, MCMI, Cmgr, Chartered Marketer) is a partner with DD Consulting, Henley Business School’s Programme Director M&A and helps a large investment fund.

Danny can be contacted through www.ddavisconsulting.com or [email protected].

INTRODUCTION

All organizations around the world will at some stage go through some sort of splitting apart (“de-merger” – which is integration done backwards) or integration (joining together of parts).

Charities and NGOs around the world are merging together. Government departments in most countries are undergoing some sort of change, improvement or efficiency. These are often called “change programmes” or “transformation programmes” but are all essentially types of mergers which involve integration.

Organizations go through restructuring to become more efficient or cut costs. These exercises often include consolidations, i.e. the coming together of process, departments or IT systems. These are all slightly simplified integrations and are all covered within this book.

Every merger that happens around the world needs some strategic integration and delivery thinking. You will learn how to integrate anything – a department, sales force, business unit, government department, charity, company or corporate. In doing so, you will learn how to restructure, consolidate, reduce costs, create efficiencies and perform mergers from small to mega mergers.

PART I

THE STRATEGIC DRIVERS

CHAPTER 1

M&A OVERVIEW

CHAPTER SUMMARY

This chapter looks at the different types of M&A and the drivers behind the decision to purchase. It discusses the factors that need to be taken into account in deciding how much to pay and highlights the importance of setting the criteria for success early on.

There is also an overview of the M&A deal process, which sets out the key stages. It is surprising how few people know and understand the overall deal process, but without this understanding they cannot plan or deliver. These sections provide a starting point for the topics, with more detail following in later chapters.

Later in the chapter, we discuss the importance of reflecting the overall business strategy in the integration plan and of ensuring that the learning derived from the process is not lost when the deal is closed.

WHAT TYPES OF M&A ARE THERE?

“First, have a clear organic growth strategy and a clear investment strategy, then buy where we need to augment growth.”

John Peace, Chairman, Experian

Organizations looking for growth can go down one of three paths – organic growth, joint venture (JV, or partnerships) and M&A. All companies should constantly be looking at all three. Organic growth must be the first and main area of priority. Businesses then need to look at the other two and move forward depending on their skill set, cash flow and aims. Many companies do all three. Some decide they don’t want to do M&A now because they don’t have the funds or the skills/capability to move forward. Some decide M&A is the only way forward and that owning part of a company does not provide them with the control they need to move forward fast enough.