Tackling the tech integration challenge of mergers today

Mergers have become a lot more complex in a digital world— but tech itself can spell the solution to integration.
6 January 2020

Just Eat and Takeaway.com announced a merger earlier this year. Source: Shutterstock

Mergers and acquisitions (M&A) are essential for the growth of organizations and diversification of investment. If executed adeptly, the business should be able to continue operations throughout and see topline revenue improvements follow on-course with a pre-planned roadmap.  

With organizations and their operating models now heavily reliant on technology and data, the smooth integration of platforms and systems have become crucial objectives in the merger process— technology itself can be a catalyst and enabler for this process. 

According to Accenture, 58 percent of business executives said technology is a significant enabler of mergers laying the path new markets and increased revenue. Technology streamlining operation systems of organizations have been found to smoothen the integration process.

On the other hand, forward-thinking companies are acquiring organizations with technology as a catalyst to stay ahead of the curve on industry trends, especially in this digital age. About half (42 percent) of executives prioritized acquiring next-generation technology to elevate the merger and acquisition process. 

 In this case, there are several considerations to bear in mind when undertaking M&As in a time where technology is indispensable; IT leadership and early planning are essential to prepare the organization for challenges ahead and to ensure mergers are successful. 

Steps for M&As in a digital world

Firstly, due diligence is the discussion of involved companies to ensure the terms of the deal are comfortable for all parties, yet it rarely considers the compatibility of two separate enterprise technology systems. 

In this case, the integration could lead to an unplanned disaster or elevated technological cooperation. It is critical for businesses to include technology as part of the conversation at the early stages of discussion. 

By having a clear outline of acquisition goals and laying out the foundation of the integration, businesses will find technology as a way to streamline the post-merger and acquisition phase. For example, IT leaders can plan ahead of budgets, whether to unify operations into a single channel or build integration paths to fulfill short-term needs. 

By doing so, the cost and time-scale of technological integration can be formulated at an early stage before complications arise. 

Next, IT skills planning involves a specialized team to monitor and oversee the integration of systems across the two organizations. By having the right skills on board, a company will find the post-merger or acquisition stage more organized and feasible. 

Employees will be supported and more likely to adapt to new systems when a team of IT experts is available. Once an IT support team is set to up to support the integration, data (a valuable commodity) needs to be secured and protected at all times during the transition period. 

One of the considerations acquiring companies will have is the accessibility of customer data after the integration. Besides that, in accordance with the General Data Protection Regulation (GDPR) introduced in 2018, there are some changes made to data management

As an example, a change in the role of data “controller” will likely reevaluate the way systems share and store data as well as the individuals affected by this integration. Instead of having siloed data systems where importing and exporting of data are more inclined to cybersecurity risks, an integrated system which allows data sharing seems the better and safer choice. 

The steps mentioned so far allows IT leaders to have an idea of the resources acquired and the best way to deploy them. Ultimately, the goal of integrating two formerly independent systems without disrupting day-to-day business activities remains the real challenge. 

Integration-platform-as-a-service (iPasS) has been noted to connect disparate applications and siloed data. The technology standardizes how applications are added to an organization. 

In this context, iPaaS can ensure a seamless integration without disrupting two business operations due to its ability to run a multitude of applications to ensure they work in a coherent and integrated manner. 

A good start is half the battle

The goal of due diligence should provide the opportunity for companies to discuss the technological aspects during merger or acquisition. As a result, companies will be able to achieve system connectivity with lower cost and in a shorter span of time. After all, technology running and supporting organizations as the backbone are essential to upholding the operations of a business. 

If companies are unable to bring forward the plans on how two separate systems can be operated in a unified way, higher risk and costs await. On the other hand, those who consider the “technology fit” during the due diligence stage will find themselves set to overcome challenges and accelerate with gains to efficiency.