Going through a merger or acquisition is a complicated time for any business. When you’re trying to find a way to piece the best parts of two companies together, you need to create proper plans and strategies. Without a clear direction, navigating the many changes that come with an M&A can be even more difficult — especially when it comes to your tech department.
Companies have their choice of hundreds of versions of different technologies, platforms and programs to help them do business more efficiently. This usually means that merging companies aren’t operating on the same platforms or programs. Even if they are using the same platforms, the migration of data and information can cause lost details or gaps if not done properly.
If both companies do not take the time to create a migration plan, they’re in store for a rocky road in the future. When merging or acquiring another company, the way transitional decisions are made can dictate whether or not the company succeeds or fails.
In order to make your tech transition as smooth as it can be, here are seven steps your company needs to take before beginning the merger and acquisition tech transition process.
Understand Your Existing Architecture
Before you begin the transition process, you need to take a look at the existing architecture of your company’s tech department. You should know what programs are being used, why they’re being used and whether or not they’re performing as well as you’d like. You’ll also want to look at the various departments within your tech department and what kind of work they’re doing.
When you know the architecture of your tech department, you will know what areas you can cut back on, which areas need to be stronger and which areas need to make an appearance after the merger and acquisition is complete. This can help you better understand what you need out of the company you pair with for the M&A.
By identifying and understanding the company’s tech department before the merger or acquisition, company leaders will be alerted of potential problems early on. If the company needs to delay the M&A in order to get the technology of the company better under control, they’ll know before any contracts are signed or work is done.
Examine the New Company
Mergers and acquisitions run smoothly when both companies are already compatible. If each company has similar goals, values and tech concepts, it will mean the transition will run seamlessly and without much difficulty. This also applies to the culture of each company and the way the employees work while in the office.
However, if there are discrepancies or red flags between the two companies, the merger or acquisition could end up being a questionable decision for both companies. For the tech department, this means staying aware of any potential differences between the businesses that could make the M&A more expensive than necessary.
Aside from strictly looking at the way both companies operate, tech departments will need to look at the new company’s processes, as well. If the employees of each company don’t work the same way, this could cause problems later on. If those problems seem like they can be solved without much expense, address them before the merger or acquisition begins.
- Designate an M&A Leader
Before creating a transitional plan, designate one person who will be in charge of overseeing the plan and ensuring everything runs smoothly. The individual in charge may be the CIO of the new company or even a professional brought in to oversee the transition process. This one individual can then designate tasks to other employees and act on the big-picture idea of what the transition should look like.
By designating one individual to orchestrate the change, individuals from either company will know who to report to and who’s calling the shots. With just one voice to give commands and instructions, employees will have less confusion about who to come to with questions.
Having one voice to speak to both companies instead of one voice for each company can also cut back on wasted time. When no one knows who they should listen to, unnecessary work might be completed or other items may get missed. In order to have the transition completed as quickly as possible, you’ll want to designate only one leader for the tech department.
- Choose the Best Software
When going through a merger and acquisition, one company’s software and processes are likely to be left behind. While employees may be resistant to making major changings to the way they work, tech leaders within the company need to keep their bottom line in mind. If the other company does something more efficiently, utilizing their technology will be best for the organization as a whole.
There are a few areas that the tech department must consider when choosing which software and processes to move forward with during the M&A. These considerations include the usability, scalability, value, innovation and security of the technology.
Select software that will be easy for all employees to understand and use and is capable of growing and changing with the company. This will reduce the amount of time needed to train employees in new software and will save the company money during an already expensive time. The selected technology should also be safe for employees, the company and customers.
- Prepare for the Transition
Once you have the plan in place, you’re ready to begin preparing your data and technology for the transition. However, there are a few things you need to do before you begin moving information into a new program or host.
First, take time to ensure your data is backed up. Know that your data is successfully backed up and where it’s located, and that you have additional backup copies if the first is lost or missing important information. If you need to make backups, delay your migration until you have complete and successful support.
You’ll also want to identify areas that may cause problems during the migration, such as firewalls or anti-virus software, that may interrupt your migration and cause losses. Know what steps you should take if you run into an issue and have the information readily available if you should need it.
- Focus on Speed of Transition
While rushing things too quickly can lead to problems or disruptions, you also don’t want to take your time while transitioning your tech. Because your company will still be running during your tech migration, customers, clients and the company may experience downtime or other problems while you’re making the transition.
You’ll want to focus on getting the transition completed as quickly as possible. This may mean designating the work to a few members capable of completing the task with minimal disruptions and distractions, or creating a small team of employees who can migrate the data with ease. It also usually means having leaders on the project who are well-versed in the merger and who can eliminate downtime.
The sooner the transition is finished, the faster both companies will be able to pick up work as one larger, stronger company. Additionally, once all the data is in one place, it will be easier for employees at all levels to get used to the changes that are coming.
- Evaluate and Make Adjustments
Once the technology transition is completed, both companies should be ready to move forward on the same page. However, it isn’t uncommon for problems to arise immediately following the migration of data or change of processes.
While everyone is still trying to find their footing with the new M&A, technology leaders will need to do what they can to answer questions, iron out the wrinkles and help employees or customers get a solid stance on the new company. Taking the time to help everyone get on the same page will ensure that no one gets left behind or lost in the confusion.
Evaluations and adjustments may be necessary for a few weeks or months after the merger or acquisition. Continue moving forward in doing business, but keep your eyes open for potential problems and solve them before they turn into larger issues.
While going through a merger or acquisition is never an easy time for businesses, they usually result in some extremely successful and powerful companies. However, the success of a new business completely depends on how prepared the businesses were when they begin the transition process. If proper planning and preparation weren’t completed before the transition began, the gaps and cracks will show when it’s too late to make changes.
If you’re planning for the tech transition of your merger or acquisition, following these seven steps can help set you on a path to success. Through understanding your company, the company you’re about to merge with and working together on a plan that covers all your needs and bases, you’ll come out the other side a stronger business.