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Mergers and acquisitions (M&As) are big business, and these big deals haven’t slowed down significantly, even as a global pandemic takes center stage. In fact, mega M&A deals — deals worth at least $5 billion — are on the rise, like Amazon’s $8.45 billion acquisition of MGM and Google’s $5.4 billion acquisition of Mandiant. occupy dollars. With the rise of mergers and acquisitions, companies are often under pressure to maximize the transition quickly and the repayment. Stakeholders want an organization that works effectively and efficiently from day one, but is that even possible?
With technology it is
When two companies come together – with their own data, their own applications, their own processes, their own people – things can get complicated. Cloud computing, artificial intelligence (AI), machine learning (ML), and low-code tools—to name a few—have made the transition from two entities one much more transparent. These tools and applications have also made it easier for companies to adapt to and overcome the issues of today’s labor shortages that can hamper the M&A process. Tools like low-code that don’t require significant human capital are a must.
Using these tools and resources is important considering that every business has its own unique set of applications, datasets, and data criteria. Data criteria can include relevance, objectivity, measurability, and completeness, and are likely to differ from Company A to Company B. Without the use of technology, bringing this data together is a long, tedious process, especially when it comes to tracking progress track and coordinate activities between the acquirer and the acquirer.
Bringing disparate applications and data together is a major hurdle in any M&A, where in most cases each company has different mission-critical applications and legacy systems in place. It’s important to know what data you have, where it resides, who is using it, and whether personally identifiable information (PII) is protected before deciding what to integrate.
Organizations need to keep sensitive consumer data secure and provide frictionless customer experiences throughout the M&A process while avoiding penalties related to missed deadlines for transitional service contracts and outages/downtime due to potential delays in service. The latter can lead to customer churn and lost sales, potentially damaging the brand as a whole.
In the beginning, those involved in the M&A deal need to create a plan, and that plan needs to be supported by momentum.
Mergers and Acquisitions: Momentum is everything
Many leaders know only too well that the moment something falters in achieving a goal or goal, it’s very difficult to get it going again. For this reason, the key to successful M&A is momentum, and data drives that momentum.
One of the first steps in a merger and acquisition is to access the acquired company’s data, identify targets for the data, and decide what data types and definitions to use going forward. Data integrations, data transformations, and reporting should all use these agreed definitions so everyone is on the same page and has a common understanding of what is being done and what opportunities and threats need to be addressed. This ultimately ensures data accuracy and consistency across multiple applications and stakeholders.
It is imperative that two previously unrelated systems (and companies) work together, and the dynamics can determine or hamper the success of mergers and acquisitions. Without a flexible IT infrastructure, this can seem like an impossible task.
Integration does not mean completely merging all systems and making them into one; Providing technology for teams to share and access data works just as well, if not better. Sales teams from two newly merged companies need to be able to collaborate and go to market together; They need to see all the data — including products, customers, employees, and partners — so they can cross-sell and ensure a consistent customer experience. This can be done at a central cloud location.
Leveraging cloud applications is a good way to get the newly merged company up and running quickly and provide data that people need. Cloud apps can be set up almost instantly, they are easy to configure and data can be migrated to them relatively quickly. Modern integration platforms make this strategy easier to implement as they provide standard connectors to popular cloud applications, dramatically reducing the time and effort involved with an alternative approach.
Companies assume additional liabilities when they merge with or acquire another company. They face major regulatory risks related to information security because they don’t know where all their data is and they don’t protect personal data. Cloud platforms can work wonders in such situations. Within weeks or even days it is possible to select and configure a cloud application, integrate it with other systems and make it available to authorized users across the new organization.
While the goal of all mergers and acquisitions is to get the business up and running quickly and efficiently, data integration, data access, and data protection are key components to a smooth transition. Remember M&As are changes for multiple organizations.
And the way to master any type of change is to show momentum toward the goals set as part of the initial investment—in this case, the data. Using tools like AI, ML, and low-code can help achieve these goals.
As part of the integration plan, organizations should determine the type of visibility stakeholders need and identify the data sources required. They should also ensure they have the momentum and integration and transformation technology to build connections that meet and ultimately exceed customer expectations.
Chris Port is Boomi’s COO.
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