Mr. Shiery is a Management and Strategy consultant with CapTech Consulting. Before joining CapTech, Mr. Shiery was a Business and Systems Integration consultant with Accenture. He holds a Bachelors of Science in Industrial Engineering from The Pennsylvania State University, and an MBA from the IE Business School in Spain. Mr. Shiery has performed program management and strategy analysis on several large-scale integrations, and has specific expertise in the alignment of Business and IT. In addition to his experience and education, he is PMP certified and holds an Executive Leadership certificate from Cornell.
Dynamic Post Merger Integrations through Agile IT
Sep 11 2012
In CapTech Consulting’s attached white paper entitled “Maximizing Synergy Potential (MSP) in Acquisition Strategies”, we sought to eradicate common provincial constraints that have notoriously driven today’s status quo ‘2+2=5’ synergy perspective.
In doing so, we transformed variables from their static state into a more representative dynamic depiction. Most notably, we incorporated a 3rd less desirable, but necessary variable, to account for the dis-synergies of an acquisition.
Since synergies are essentially opportunities, we summarized the Maximum Synergy Potential of an acquisition as the value summation of all potential synergies (identified and hidden) of the newly combined company, subtracted by the sum of the value dis-synergies (synergy realization costs, inefficiencies created by the merger, employee resistance, etc.) resulting from the acquisition.
When we set out to define MSP, the intent was not to provide another mathematical equation for determining value. In fact, we focused the majority of the article’s remaining message on the dis-synergy causes and their respective mitigation strategies by reflecting on our vast experience and accomplishments in preventing integration dis-synergies for Fortune 500 companies.
The vision was to fundamentally transform the way organizations philosophically approach their integration strategies. As Albert Einstein once said, "To raise new questions, new possibilities, to regard old problems from a new angle, requires creative imagination and marks real advances in science."
A principal idea of that vision is to free organizations from their own linear constraints, consequently accelerating the integration cycles and decreasing the windows of opportunity for dis-synergies. One way to accomplish this objective is through the employment of an Agile Methodology for your technology post merger integration.
As IT becomes increasingly vital to the success of enterprise strategies, technology integrations will have significant impacts on your acquisition strategy’s MSP for better or worse. Recent research has indicated that as many as 40% of potential synergies are directly or indirectly dependent on IT.
Bill Gates could not have articulated it better when he was quoted as saying, “Information technology and business are becoming inextricably interwoven. I don't think anybody can talk meaningfully about one without talking about the other.”
Leveraging an Agile Methodology may provide several significant benefits that cannot be achieved with the more “conventional and linear” waterfall methodology.
Agile Methodologies promote development, teamwork, collaboration, and process adaptability throughout the life-cycle of the technology integration. Below are some examples of how employing an agile methodology may mitigate 5 of the top 10 most predominantly listed causes of merger integration failures.
1. Technology Integration
- Changes in requirements and scope have historically been failure points for post merger integrations, causing late deliveries, missed schedules, and dissatisfied customers. Agile’s iterative approach enables IT flexibility and alignment to the continuously changing business priorities so often experienced in mergers.
2. Culture Conflicts
- Agile tends to create inspired, motivated and unified teams through their accountability to process improvement, creative input, self-organization, team goals, and cross functional support.
3. Customer Retention
- Facilitates a tight linkage between the customer and the delivery teams through early and continuous customer feedback.
- Waterfall methodologies may generate a scenario where customers receive a delivery of requirements a year after they were requested. In today’s economic uncertainty, the Agile Methodology ensures delivery of the customer’s requirements when they truly need them.
4. Integration Timing
- Agile is adaptive to changing business needs, giving the business sponsors more control over adding, changing, or removing requirements than conventional methodologies.
- Agile enables faster speed-to-market, demand responsiveness, and increased business efficiencies through more accurate estimations and flexibility than the linear waterfall methodology.
5. Risk Management
- Management realizes cost/time savings due to waste elimination and efficiency, effectively transforming into "lean" organizations.
- Better resource management for shared team members, specifically highly constrained subject matter experts, throughout the merger integration.
- In many cases, unanticipated risks may surface during the integration phase. The iterative approach identifies risks earlier, and essentially quarantines their realized impacts to smaller deliveries.
For your acquisition strategy to benefit from an agile methodology, it will take discipline, commitment, and leadership from the top. This holds true even more so in organizations that have invested heavily in the traditional methodologies driven by a linear philosophy.
The challenges of this philosophical transformation across organizations will be explored in future CapTech Consulting blogs. CapTech Consulting has world-class consultants with expertise integrating Fortune 500 organizations through the waterfall and agile methodologies. If your organization is seeking to better understand agile methodology benefits to your technology post merger integration, contact us.
|MSP by CapTech Consulting.pdf||1.03 MB|