August 18, 2021
IT Integration Challenges in M&A
Realistic time frames, healthy IT environments and seamless authentication get mergers started on the right foot.
Any number of factors can complicate a merger or acquisition, but integrating multiple IT environments is undoubtedly one of the biggest complications. Technology can facilitate a powerful alliance between two organizations, perhaps even driving a merger in the first place. But a poorly planned IT transition, on the other hand, gums up the process for everyone.
Assuming the initial due diligence was effective, the biggest challenges I see in technology integrations typically arise from unreasonably accelerated timelines. Take email, for instance: If an organization’s management says, “We’re officially going to be one company on day one, so 45 days from now, we need a common email platform,” the merged IT departments face a nearly insurmountable task.
There are shortcuts to enable users to look as if they’re sending email from a single source. But generally, several other steps need to occur at this juncture for the migration to go smoothly. With email, as with the rest of the technology transition, it’s better in the long run to take the time to do things correctly.
Minimize Disruption by Mapping a Realistic Timeline for IT
Before pushing a timeline, executives should first determine a reasonable amount of time for specific elements of the M&A process. Unreasonable timelines can scare teams, and they really send a shiver through IT staff at the company being acquired.
IT leaders should try to slow things down. They should make sure the security standards and licensing costs match, and establish a plan for consolidating data and systems.
There should also be a plan to achieve all that while minimizing disruption at the desktop level. Often, if organizations push too much change too quickly, users freeze up and feel they can’t do their jobs.
Address Key Concerns in the IT and User Environments
Suppose one company has an unhealthy environment, such as a Microsoft Active Directory that includes numerous users who are no longer with the company. What happens when you sync this with another system or to the cloud? If garbage data exists when you bring systems together, you’ve now spread your garbage data across companies and cloud software programs. That needs to be cleaned up first.
It also takes time to strategize how to overcome hurdles related to authentication. How will employees sign in? How will they reach the HR department if one company uses Workday and the other uses PeopleSoft? Will the company create a seamless, single sign-on system that works with both entities, making it easy for employees to access the documents and applications they need?
If authentication becomes a hassle, users will either stop working or they’ll write their passwords on a Post-it note and stick it on the monitor, which compromises security. As the various parts of the organization come together, how users log in to various systems is critical for security and productivity. (Read more about overcoming authentication challenges in the M&A process in this use case.)
Technology plays a central, complex role in mergers and acquisitions, and IT ultimately becomes either a shared asset or an unfortunate liability. It’s worth investing the time to manage technology transitions effectively.