pmi - Blog - Global Risk Community2024-03-28T09:17:57Zhttps://globalriskcommunity.com/profiles/blogs/feed/tag/pmiPost-Merger Integration Synergies: 6 Strategieshttps://globalriskcommunity.com/profiles/blogs/post-merger-integration-synergies-6-strategies2021-03-13T11:42:06.000Z2021-03-13T11:42:06.000ZMark Bridgeshttps://globalriskcommunity.com/members/MarkBridges<div><div class="entry"><p><a href="{{#staticFileLink}}8662133692,original{{/staticFileLink}}"><img class="align-right" src="{{#staticFileLink}}8662133692,RESIZE_400x{{/staticFileLink}}" alt="8662133692?profile=RESIZE_400x" width="297" height="167" /></a>A significant number of Mergers remain unsuccessful, because companies do not employ a thorough and disciplined approach to realizing Post-Merger Integration Synergies. In reasons for failure, we hear remarks like:</p><ul><li><span style="font-size:14pt;">Targets were set several months earlier by the top management without consulting the line managers, or taking ground realities into consideration.</span></li><li><span style="font-size:14pt;">Assumption base for setting targets was untested.</span></li><li><span style="font-size:14pt;">Targets were met but the timeframe for achieving them made them ineffective—in terms of diminished returns, shareholder disappointment, or depressed share value.</span></li><li><span style="font-size:14pt;">Desired Synergies were achieved but at a very high cost or fairly weakened morale.</span></li></ul><p>A disciplined and rational approach to pursuing Merger Synergies is key to successful Post-Merger Integration (PMI). Companies that authenticate and set pragmatic yet ambitious Post-Merger Integration Synergy targets do the following to exceed targets and achieve substantial share price premium and a significant <a href="https://flevy.com/business-toolkit/competitive-advantage">Competitive Advantage</a>:</p><ul><li><span style="font-size:14pt;">Advise Integration Leaders on how to aim high.</span></li><li><span style="font-size:14pt;">Give managers—responsible for achieving targets—a say in target-setting process.</span></li><li><span style="font-size:14pt;">Create detailed plans with built-in accountabilities.</span></li><li><span style="font-size:14pt;">Pursue their targets aggressively.</span></li></ul><p>Successful PMI Synergies—be it in <a href="https://flevy.com/business-toolkit/cost-optimization">Cost Optimization</a>, <a href="https://flevy.com/business-toolkit/strategic-sourcing-src">Strategic Sourcing</a>, Greater Revenues or any other Cost or Revenue realm—have the common characteristic of leaders pursuing synergies with speed, rigor, discipline, and pragmatism with lots of analysis, planning, preparation, and fine-tuning before the close.</p><p>Success can be ensured time and again if the 6 Strategies for Post-Merger Integration Synergies are followed to the letter:</p><ol><li><span style="font-size:14pt;"><strong>Link Due Diligence (DD) and Post-Merger Integration (PMI)</strong></span></li><li><span style="font-size:14pt;"><strong>Leverage Clean Teams</strong></span></li><li><span style="font-size:14pt;"><strong>Establish Stretch Targets</strong></span></li><li><span style="font-size:14pt;"><strong>Rapidly Iterate to Targets</strong></span></li><li><span style="font-size:14pt;"><strong>Pursue Both Revenue and Cost Synergies</strong></span></li><li><span style="font-size:14pt;"><strong>Institute Performance Management</strong></span></li></ol><p><a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-6-strategies-for-synergies-5542"><img class="aligncenter size-full wp-image-8856" src="https://flevy.com/blog/wp-content/uploads/2021/03/Slide-Deck-Image.png" alt="" width="707" height="531" /></a></p><p>Implementation of the 6 Synergy Strategies involves adopting High-Engagement and Rapid Iteration approach which yields effective Stretch Target Validation and High Level of Line Accountability.</p><p>Let us delve a little deeper into 2 of these PMI Synergy Strategies.</p><h3><span style="font-size:14pt;"><strong>Link Due Diligence (DD) and Post-Merger Integration (PMI)</strong></span></h3><p>Linking DD to PMI ensures realistic estimates on part of the DD team thus avoiding formulation of broad-brushed and imprecise Synergies. Linking also guarantees greater amount of ownership and accountability at the same time enabling more compelling Stretch Targets. Linking of DD to PMI is necessary because:</p><ul><li><span style="font-size:14pt;">Under pressure to complete the M&A, <a href="https://flevy.com/business-toolkit/due-diligence">Due Diligence</a> teams frame assumptions with little knowledge of the levers influencing Synergies or the challenges involved in achieving them.</span></li><li><span style="font-size:14pt;">Due Diligence teams typically project more value in <a href="https://flevy.com/business-toolkit/cost-reduction">Cost Reduction</a> and enhanced Revenues based on erroneous assumptions—without taking into account either the Operating Model (of the former entities and the freshly created one) or the difference / overlap in Customer Base.</span></li></ul><p>Successful Mergers ensure a harmonized hand-off from Due Diligence teams to Integration Planning teams by ensuring the following:</p><ul><li><span style="font-size:14pt;">Placing members of the Mergers and Acquisition team on the Post-Merger Integration (PMI) team to produce a greater degree of ownership and continuity.</span></li><li><span style="font-size:14pt;">Involving Business Unit Heads in target setting at the Due Diligence stage and ensuring ownership and accountability.</span></li><li><span style="font-size:14pt;">Linking of Due Diligence and PMI to enable setting of more profound Stretch Targets.</span></li><li><span style="font-size:14pt;">Analyzing and detailing drivers of saving at a high-level for creating Synergy Targets and Ranges which make later improvements possible based on subsequent information. These targets and ranges enable evaluation of potential gains from new company’s Operating Model.<strong> </strong></span></li></ul><h3><span style="font-size:14pt;"><strong>Leverage Clean Teams</strong></span></h3><p>Clean team is an independent group that is tasked with the collection and analysis of sensitive company data—pre-closure—with the guidance of management. Clean team may comprise of third-party members or employees who can be reassigned out of business in case of deal failure eradicating the risk of compromising confidential information. Clean team is formed by legal contract based on protocols agreed to by both company’s legal departments. Clean teams help by:</p><ul><li><span style="font-size:14pt;">Accelerating PMI planning.</span></li><li><span style="font-size:14pt;">Enabling the acquiring company to have a clearer picture of the target company without violating anti-trust regulation or confidentiality agreements.</span></li><li><span style="font-size:14pt;">Assessing risks and enabling companies to achieve Synergies faster.</span></li><li><span style="font-size:14pt;">Keeping sensitive information of both sides safe—pre-closure—yet embark on planning and preparation even before close in order to save precious time and keep customer confidence high.</span></li><li><span style="font-size:14pt;">Aiding companies accomplish 3 core integration activities before closing—compiling wide-range baseline data, vetting Synergy targets, and preparing options for key decisions.</span></li><li><span style="font-size:14pt;">Empowering companies to avoid / diminish confusion caused by overlap in client assignments and sales people.</span></li><li><span style="font-size:14pt;">Assisting provision of clear information to customers regarding products and services thus avoiding drop in sales.</span></li></ul><p>Interested in learning more about the 6 Strategies for Post-Merger Integration Synergies? You can download an <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-6-strategies-for-synergies-5542">editable PowerPoint on <strong>Post-Merger Integration (PMI): 6 Strategies for Synergies</strong> here</a> on the Flevy documents marketplace.</p><h3><span style="font-size:14pt;"><strong>Want to Achieve Excellence in Post-merger Integration (PMI)?</strong></span></h3><p>Gain the knowledge and develop the expertise to become an expert in Post-merger Integration (PMI). Our frameworks are based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. <a href="https://flevy.com/browse/stream/post-merger-integration">Click here for full details.</a></p><p>M&A is an extremely common strategy for growth. M&A transactions always look great on paper. This is why the buyer typically pays a 10-35% premium over the of the target company's market value. </p><p>However, when it comes time for the Post-merger Integration (PMI), <em>are we really able to capture the expected value?</em> Studies show only 20% of organizations capture projected revenue synergies and only 40% capture cost synergies. Not to mention, the PMI process is typically very painful, drawn out, and politically charged, often resulting in the loss of key personnel.</p><p><a href="https://flevy.com/browse/stream/post-merger-integration">Learn about our <strong>Post-merger Integration (PMI) Best Practice Frameworks</strong> here.</a></p><h3><span style="font-size:14pt;"><strong>Do You Find Value in This Framework?</strong></span></h3><p>You can download in-depth presentations on this and hundreds of similar business frameworks from the <a href="https://flevy.com/pro/library">FlevyPro Library</a>. <a href="https://flevy.com/pro">FlevyPro</a> is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:</p><blockquote><p>“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. 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For us, it is an invaluable resource to increase our impact and value.”</p><p>– David Coloma, Consulting Area Manager at Cynertia Consulting</p></blockquote><blockquote><p>“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”</p><p>– Roderick Cameron, Founding Partner at SGFE Ltd</p></blockquote></div></div>Taking a Strategic Move to Post-merger Integration (PMI): Financial Integrationhttps://globalriskcommunity.com/profiles/blogs/taking-a-strategic-move-to-post-merger-integration-pmi-financial2020-07-11T06:30:06.000Z2020-07-11T06:30:06.000ZJoseph Robinsonhttps://globalriskcommunity.com/members/JosephRobinson808<div><p></p><p>Our framework <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-financial-integration-4049">Post-merger Integration (PMI): Financial integration</a> is every organization’s guide to achieving the financial alignment of both Buyer<a href="https://flevy.com/blog/wp-content/uploads/2020/03/pic-1-Financial-Integration-300x200.jpg" target="_blank"><img src="https://flevy.com/blog/wp-content/uploads/2020/03/pic-1-Financial-Integration-300x200.jpg?profile=RESIZE_710x" width="300" class="align-right" alt="pic-1-Financial-Integration-300x200.jpg?profile=RESIZE_710x" /></a> and Target.</p><p><a href="https://flevy.com/browse/stream/post-merger-integration">Post-merger Integration</a> is a highly complex process. It requires swift action as well as running the core business activities simultaneously. There is no one-size-fits-all approach to a successful PMI Process. However, careful planning focusing on the strategic objectives of the deal and the identification and capturing of synergies will help maximize deal value.</p><p>Another critical factor in PMI is pursuing Financial Integration. Financial Integration is the alignment of the finance functions of the Buyer and Target.</p><h3><strong>Why Financial Integration?</strong></h3><p>Immediately from the start of the deal, the new organization gets to be dependent on the Finance function to ensure a successful integration process. Synergies must be captured in order to maximize deal value and provide combined organizations with the flexibility to grow.</p><p>When pursuing Financial Integration, there must be an integration of business operations, streamlining of the internal control environment, provision of accurate and consistent financial reporting, ensuring tax compliance jurisdictions if the deal is cross-border, and the founding of interim legal structure and business processes. When setting the right direction for a streamlined finance function, it is important that the organizations must already tackle critical matters while still in the early stages of a deal.</p><p>The establishment of clear reporting lines must already be agreed upon and set up. Accountability for financial operations, management reporting, control of expenses, and accounting closing procedures must already be established and clear between the Buyer and the Target. These play a vital role when the organization undertakes a <a href="https://flevy.com/strategic-planning">Strategic Planning</a> geared towards the development of a Financial Integration Strategy and Plan.</p><h3><strong>The Financial Integration Strategy: What We Need to Know</strong></h3><p>The Financial Integration Strategy can only be defined and crafted only when immediate areas that require action have already been identified. The Strategy must be developed based on <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-financial-integration-4049">8 key areas of focus</a>.</p><p><a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-financial-integration-4049" target="_blank"><img src="https://flevy.com/blog/wp-content/uploads/2020/03/pic-2-Financial-Integration.png?profile=RESIZE_710x" width="750" class="align-full" alt="pic-2-Financial-Integration.png?profile=RESIZE_710x" /></a></p><ol><li><strong>Overall Organization</strong>. As the first key area, this focuses on the overall set up of the Financial Integration processes. This starts with establishing the reporting lines from <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-day-one-activities-4046">Day One of the PMI process</a>. This also includes the establishment of a transition plan that is aligned with the process and systems migration plan.</li></ol><ol start="2"><li><strong> Internal Controls Environment</strong>. Once the overall organization has been set up, it is important that the internal controls environment is established. This will entail setting up the control procedure from Day One. It is of importance that the controls environment is established since this will mitigate risks and ensure regulatory compliance.</li></ol><ol start="3"><li><strong>Cash/Treasury</strong>. This is the third key area that looks into the cash position of the organization. It is at this point wherein the organization must be able to plan out its cash flow requirements and be able to gain assurance over adequate funding. This key area is very critical when it comes to the financial sustainability of the organization as it ensures that treasury policies are aligned, cash controls are established, cash forecasting and cash management have commenced, and there is an alignment of investments, foreign currency, and any hedging arrangements.</li></ol><p>Aside from the 3 focus areas, the development of the <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-financial-integration-4049">PMI Financial Integration Strategic Plan</a> must also give serious consideration on Financial Statements, Procurement, Financial Planning, Cash Controls, and Tax. These 5 focus areas are essentially important as it ensures that Financial Integration essentials are met.</p><p>When this is achieved and the 8 key areas of focus are integrated into the Financial Integration Plan, the new organization gets to prepare itself towards a larger scale <a href="https://flevy.com/browse/stream/transformation">Business Transformation</a> in the future.</p><p>Interested in gaining more understanding of the <a href="https://flevy.com/browse/stream/post-merger-integration">Financial Integration component of PMI</a>? You can learn more and download an <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-financial-integration-4049">editable PowerPoint about <strong>Post-merger (PMI): Financial Integration</strong> here</a> on the <a href="https://flevy.com/browse">Flevy documents marketplace</a>.</p><p><strong>Are you a management consultant?</strong></p><p>You can download this and hundreds of other <a href="https://flevy.com/pro/library/frameworks">consulting frameworks</a> and <a href="https://flevy.com/pro/library/consulting">consulting training guides</a> from the <a href="https://flevy.com/pro/library">FlevyPro library</a>.</p></div>The Key to Maximizing Deal Value: Post-merger Integration (PMI) Roles & Responsibilitieshttps://globalriskcommunity.com/profiles/blogs/the-key-to-maximizing-deal-value-post-merger-integration-pmi2020-07-08T07:30:00.000Z2020-07-08T07:30:00.000ZJoseph Robinsonhttps://globalriskcommunity.com/members/JosephRobinson808<div><p></p><p>For <a href="https://flevy.com/browse/stream/post-merger-integration">Post-merger Integration (PMI)</a> to be successful, it is critical that we have clearly defined, appropriate, and comprehensive roles and responsibilities.</p><p><a href="https://flevy.com/blog/wp-content/uploads/2020/03/pic-1-Roles-Responsibilities-300x198.jpeg" target="_blank"><img src="https://flevy.com/blog/wp-content/uploads/2020/03/pic-1-Roles-Responsibilities-300x198.jpeg?profile=RESIZE_710x" width="300" class="align-right" alt="pic-1-Roles-Responsibilities-300x198.jpeg?profile=RESIZE_710x" /></a></p><p>Post-merger Integration is a highly complex process. It requires swift action as well as running the core business activities simultaneously. There is no one-size-fits-all approach to a successful PMI Process. However, careful planning focusing on the strategic objectives of the deal and the identification and capturing of synergies will help maximize deal value.</p><p>While it may be a highly complex project, a successful PMI may be achieved and greater deal value can be expected. Right from <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-day-one-activities-4046">Day One of PMI</a>, it is already important that the Buyer and Target have the right people in place. The success of the integration project depends on leadership, project management capabilities, and selection of the right personnel to the work in teams/streams.</p><h3><strong>Roles & Responsibilities in PMI: Why the Need for Emphasis</strong></h3><p>So, what are the requisite <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-roles-and-responsibilities-4061">PMI roles and responsibilities</a>? Clearly defined roles and responsibilities are a fundamental factor that can make a big difference between gaining deal success or failure.</p><p><a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-roles-and-responsibilities-4061" target="_blank"><img src="https://flevy.com/blog/wp-content/uploads/2020/03/pic-2-Roles-and-Responsibilities.png?profile=RESIZE_710x" width="750" class="align-full" alt="pic-2-Roles-and-Responsibilities.png?profile=RESIZE_710x" /></a></p><p>The Integration owner, together with the <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-roles-and-responsibilities-4061">Integration Steering Group</a> plays a critical role in defining the integration path of the organization. In <a href="https://flevy.com/browse/stream/leadership">Leadership Development</a>, their role in the First 100 Days is a fundamental factor in achieving success or failure.</p><ol><li><strong>Integration Owner</strong>. The Integration Owner is a member of the Buyer’s management team. He/she is basically the owner of the integration phase. It is the responsibility of the Integration Owner to oversee the integration phase, as well as the transaction/purchase phase.</li></ol><ol start="2"><li><strong>Integration Steering Group</strong>. The Integration Steering Group is the governing body of the integration phase. The specific role of the Integration Steering Group is to supervise the work of the Integration Project Manager and the Integration Team.</li></ol><ol start="3"><li><strong>Integration Manager</strong>. The Integration Manager is the Project Manager. He/she is the one in charge of the day-to-day management of the integration. If the Integration Manager has little or no project management experience then active hands-on support is required from the M&A Project owner.</li></ol><ol start="4"><li><strong>Integration Team/Stream</strong>. The Integration Team/Stream consists of an Integration Manager and its members. Streams are areas of the organization split into district parts but which are aligned to the overall strategy. Integration streams are often decided after the first appointment of the Integration Manager. Each stream is often headed by the Integration Stream Manager.</li></ol><h3><strong>The Critical Role of the Integration Stream Manager</strong></h3><p>The <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-roles-and-responsibilities-4061">Integration Stream Managers</a> are selected from among the Buyer’s managers. They play a vital role as they are responsible for the development and implementation of detailed plans.</p><p>The Integration Stream Managers act as the team builder and introduce the team members to each other. They ensure that the team members have all the information and tools needed for the task. They clarify goals, targets, timetables, reporting, and other important matters relative to the integration. As Integration Stream Managers, they are expected to ensure that everyone in the team understands the goals the same way and is committed to making it happen.</p><p>In certain circumstances, it is possible that the Integration Stream Manager may also be Target’s manager. This happens when Target’s manager has specialized knowledge or attributes necessary for the integration.</p><p>Undertaking the Post-merger Integration Process the right way can maximize deal value. On the other hand, it can result in the greatest potential loss of value when not done right. Being able to select the right people is the key.</p><p>Interested in gaining more understanding of the various <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-roles-and-responsibilities-4061">Roles and Responsibilities within PMI</a>? You can learn more and download an <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-roles-and-responsibilities-4061">editable PowerPoint about <strong>Post-merger Integration (PMI): Roles & Responsibilities</strong> here</a> on the <a href="https://flevy.com/browse">Flevy documents marketplace</a>.</p><p><strong>Are you a management consultant?</strong></p><p>You can download this and hundreds of other <a href="https://flevy.com/pro/library/frameworks">consulting frameworks</a> and <a href="https://flevy.com/pro/library/consulting">consulting training guides</a> from the <a href="https://flevy.com/pro/library">FlevyPro library</a>.</p></div>How to Maximize Deal Value in Post-merger Integration (PMI): The PMI Processhttps://globalriskcommunity.com/profiles/blogs/how-to-maximize-deal-value-in-post-merger-integration-pmi-the-pmi2020-07-04T06:19:02.000Z2020-07-04T06:19:02.000ZJoseph Robinsonhttps://globalriskcommunity.com/members/JosephRobinson808<div><p></p><p><a href="https://flevy.com/browse/stream/post-merger-integration">Post-merger Integration (PMI)</a> can be complex, time-pressured, and unfamiliar for most organizations. It is a highly <a href="{{#staticFileLink}}8028327472,original{{/staticFileLink}}" target="_blank"><img src="{{#staticFileLink}}8028327472,original{{/staticFileLink}}" width="200" class="align-right" alt="8028327472?profile=original" /></a>complex process. It requires swift action as well as running the core business activities simultaneously. There is no one-size-fits-all approach to a successful <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-pmi-process-4062">PMI Process</a>. However, careful planning focusing on the strategic objectives of the deal and the identification and capturing of synergies will help maximize deal value.</p><p>It is inevitable that some elements of information will be withheld from a Buyer pre-deal. Further, not all the synergy benefits originally identified in the deal will prove to be achievable. The foremost challenge for management at the onset of the PMI process is to identify how value can be captured from the newly combined organization via synergies and cost savings.</p><p>Hence, undertaking the PMI Process requires a clear roadmap that will take the post-merger integration journey toward a more strategic and effective direction. This is where <a href="https://flevy.com/browse/stream/strategy-development">Strategy Development</a> comes in.</p><h3><strong>The 5 Core Components of the PMI Process</strong></h3><p>Organizations must have a good understanding of the integration process to ensure that target results are achieved and that expectations are met. There are <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-pmi-process-4062">5 core components of the PMI Process</a> organizations must follow to make the process more successful where the deal value is achieved and realized.</p><p><a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-pmi-process-4062" target="_blank"><img src="https://flevy.com/blog/wp-content/uploads/2020/03/pic-2-PMI-process.png?profile=RESIZE_710x" width="750" class="align-full" alt="pic-2-PMI-process.png?profile=RESIZE_710x" /></a></p><ol><li><strong>PMI Structure</strong>. This is the first component of the PMI Process that establishes the stages of the integration process. It consists of sub-projects that take place before and after the closing or change of ownership.</li></ol><ol start="2"><li><strong>Management Alignment</strong>. The second core component, Management Alignment is focused on aligning top managers of both Buyer and Target. For the first time, top managers of the Buyer and Target become part of the same organization. It is at this stage wherein there is a change of priorities and commitment of top managers. The new management team must be aligned and committed to the same goal. This way, they convey the same message to the new organization.</li></ol><ol start="3"><li><strong>First 100 Days</strong>. The First 100 Days is where the PMI Process starts focusing on making changes. The First 100 Days is the maximum period people can live with the uncertainty regarding the new organizational structure and decision on redundancy. This core component is highly critical as this paves the way towards a smooth transition to a new organization.</li></ol><ol start="4"><li><strong>PMI Project Management</strong>. The fourth component is focused on budget planning and management. It is at this stage wherein the preparation of the first estimates of integration costs during the transaction or purchase phase is undertaken.</li></ol><ol start="5"><li><strong>Kick-off Meeting</strong>. The fifth or final core component is the Kick-off Meeting. Starting teamwork is its main focus. Participants are brought up to speed on events in both predecessor entities and the joint strategy. This is the avenue to provide instructions, guidelines, and templates. A Kick-off Meeting is typically a 2-day session including the time to socialize.</li></ol><h3><strong>The Red Flag Warning in Post-merger Integration</strong></h3><p>When going through Post-merger Integration, we can expect some red flag warnings. These are disturbances that may warrant such a red flag warning. As organizations go through the deal, there will be critical issues on personnel and customers that will arise.</p><p>One critical issue that may raise the concern of the Integration team is the possibility of losing your key personnel. Losing your key personnel can cause a dent in any organization. At this point wherein integration is happening, the more the support of the key personnel is of utmost importance. Losing them would be a great loss.</p><p>Aside from red flag warnings, there will also be key considerations organizations must take note of during integration. Being aware of these will prepare them as they move on forwards to achieving a successful deal.</p><p>Interested in gaining more understanding of the <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-pmi-process-4062">PMI Process</a>? You can learn more and download an <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-pmi-process-4062">editable PowerPoint about <strong>Post-merger Integration (PMI): PMI Process</strong> here</a> on the <a href="https://flevy.com/browse">Flevy documents marketplace</a>.</p><p><strong>Are you a management consultant?</strong></p><p>You can download this and hundreds of other <a href="https://flevy.com/pro/library/frameworks">consulting frameworks</a> and <a href="https://flevy.com/pro/library/consulting">consulting training guides</a> from the <a href="https://flevy.com/pro/library">FlevyPro library</a>.</p></div>Achieving Success in Post-merger Integration (PMI): The Top 10 Tips Every Organization Must Knowhttps://globalriskcommunity.com/profiles/blogs/achieving-success-in-post-merger-integration-pmi-the-top-10-tips2020-06-30T07:00:00.000Z2020-06-30T07:00:00.000ZJoseph Robinsonhttps://globalriskcommunity.com/members/JosephRobinson808<div><p></p><p>When organizations go through a <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-tips-for-success-4068">Post-merger Integration</a>, often management realizes that it is never a simple undertaking. It is a <a href="https://flevy.com/blog/wp-content/uploads/2020/03/pic-1-Tips-for-success-300x260.jpeg" target="_blank"><img src="https://flevy.com/blog/wp-content/uploads/2020/03/pic-1-Tips-for-success-300x260.jpeg?profile=RESIZE_710x" width="300" class="align-right" alt="pic-1-Tips-for-success-300x260.jpeg?profile=RESIZE_710x" /></a>highly complex process. Swift action is required as well as being able to run the core business activities simultaneously. There is no one-size-fits-all approach to a successful PMI Process. However, to maximize deal value, there is a need for careful planning focused on the strategic objectives of the deal and the identification and capturing of synergies.</p><p>The PMI Process requires a <a href="https://flevy.com/browse/stream/strategy-development">Strategy Development</a> approach geared towards unifying 2 organizations into one new organization with a common culture, equipped with the right people and good leadership in place. It is a challenging journey where organizations, both the Buyer and the Target, must take on the appropriate approach to be able to start off the process and close the deal with the expected results in place.</p><p>New organizations often benchmark Post-merger Integration Process leaders to guide them through the process. By following best practices, new organizations will have a better understanding of how to approach the PMI process in a more strategic manner.</p><h3><strong>Achieving PMI Success: The Top 10 Tips</strong></h3><p>There are <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-tips-for-success-4068">top 10 tips</a> that can help organizations conquer what could be a complex integration process. Following the top 10 tips will enable organizations to successfully traverse through the process.</p><p><a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-tips-for-success-4068" target="_blank"><img src="https://flevy.com/blog/wp-content/uploads/2020/03/pic-2-10-Tips-to-PMI-Success.png?profile=RESIZE_710x" width="700" class="align-full" alt="pic-2-10-Tips-to-PMI-Success.png?profile=RESIZE_710x" /></a></p><p>Let us discuss here 4 of the top 10 tips to achieve PMI success.</p><ol><li><strong>Focus on Key Sources of Value</strong>. In focusing on key sources of value, we need to be able to communicate how the value of the deal will be captured. Success organizations often structure integration teams based on key sources of value. They make teams understand the value for which they are accountable and how this will be unlocked via the PMI process.</li><li><strong>Clearly Define Nature of the Deal</strong>. Often successful integrations are achieved when the nature of the deal is clear. Organizations need to be able to determine what is to be integrated and what is to remain as stand-alone. They need to have a good idea of what the adopted culture will be and which people are to be retained. This way, organizations can easily jumpstart the PMI process in the right direction.</li><li><strong>Have the Right People in Placed</strong>. Needless delays in the implementation of the PMI process can exacerbate anxieties amongst staff. This can cause speculative conversations or result in staff insecurities. To address, organizations focus on the immediate mobilization of the integration process. One way of doing this is having the right people in placed. Selecting people who are enthusiastic about the new vision and are happy to contribute it will facilitate a good start for the integration process. However, there is a need to maintain balance. People from both the Buyer and Target must be selected and appointed.</li><li><strong>Get the Buyer up-to-speed</strong>. This is one important tip that will jumpstart the process. Get the Buyer up-to-speed. This can be done by encouraging the Buyer to begin planning the integration process even before the deal is announced. It is of great advantage if the Buyer will identify everything that must be done prior to closing. Active participation of the buyer is essential to keep the PMI process on high gear.</li></ol><p>Aside from the 4 top tips, the other 6 top tips are equally effective in guiding organizations to achieve deal maximization. These top 10 tips can be of great help to organizations when faced with challenging obstacles as they go through the process of integration. The <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-tips-for-success-4068">PMI Process</a> is a very complex undertaking but it can be achieved and be conquered with just the right approach and guide.</p><p>Interested in gaining more understanding of <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-tips-for-success-4068">Post-merger Integration (PMI): Tips for Success</a>? You can learn more and download an <a href="https://flevy.com/browse/flevypro/post-merger-integration-pmi-tips-for-success-4068">editable PowerPoint about Post-merger Integration (PMI): Tips for Success here</a> on the <a href="https://flevy.com/browse">Flevy documents marketplace</a>.</p><p><strong>Are you a management consultant?</strong></p><p>You can download this and hundreds of other <a href="https://flevy.com/pro/library/frameworks">consulting frameworks</a> and <a href="https://flevy.com/pro/library/consulting">consulting training guides</a> from the <a href="https://flevy.com/pro/library">FlevyPro library</a>.</p></div>