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How M&A IT projects differ from a traditional IT project

5 reasons why a M&A IT transformation project differs from a traditional IT project.
M&A And Traditional IT Projects

M&A And Traditional IT Projects, To plan a more effective M&A IT transformation and deliver a better “Day One” solution, it is essential to understand the characteristics that are different within an M&A IT transformation.

5 attributes of an M&A IT Project

Being aware of these differences will allow for better planning – hence here are the five main differences between an M&A IT project:

  • Multiple parties. Rather than have a single IT team developing a solution for a single business, within an M&A project, there are at least two businesses, two IT teams, and two business testing teams. Hence the programme manager has a significant task to bring these parties, with their agendas and concerns, together to deliver a substantial change.
  • Scope. Rather than focus on a specific business need or a single technology implementation, an M&A IT project will generally mean an entire IT infrastructure will need to be assessed and moved into a new environment. This company-wide scope impacts the whole project workforce – the team will need expertise across all technologies, and multiple changes will be required across many services simultaneously. Therefore, the broad scope of simultaneous change can complicate the initiative.
  • Public awareness. Once an M&A deal has been announced, the date to complete the initial day one integration may also be announced. Hence the pressure to deliver upon this date – and not allow it to slip will be high.
  • Deadline. The deadline may often be set before a full IT assessment, as the business owners will drive the deadline. However, with public awareness and a deadline in place, the pressure internally to keep to this deadline will be high. If the project slips, the joint IT team may lose confidence in the programme.
  • Transformation and Synergy options. During the Due Diligence stage, the services will be assessed based on assumptions made during the early stages of the M&A deal. IT services may be nominated during this assessment for decommissioning, “lift and shift” transformation or synergetic change. For example, it may be the case that the M&A deal assumes some cost savings based on the amalgamation of shared services such as finance and HR. Or during the M&A programme, there is an opportunity to transform some of the underlying technology platform(s).

An M&A IT integration programme can be challenging but rewarding when “Day One” is considered a success and the business continues to operate after the transformation.

However, the people and technical challenges are further amplified due to the broad scope of an M&A IT transformation and the inherent complexity.

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Hutton Henry
Hutton has worked with Private Equity Portfolio firms and Private Equity funds since 2015. Having previously worked in post-merger integration for large firms such as Ford and HP, Hutton understands the value of finding issues prior to M&A deals. He is currently the founder of Beyond M&A and provides technology due diligence for VC, PE and corporate investors, so they understand their technology risks before entering into a deal.

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