May 2021
Deal done - what now for technology and systems?
In this article published by Insider, our Mergers and Acquisitions team take a look at what happens after deal completion. New owners naturally want to consolidate everything into a single system, a single infrastructure, or a single data source; they already have them in their existing business and it’s worked well – so does that mean it’ll work well for NewCo too?
Sector Principal - Private Equity
It’s day one and you’ve walked into the shiny new business you’ve just acquired. Everything seems to be running smoothly, and that’s great; but it’s only the first chapter in the story. The hard work of integrating the new business, consolidating functions, bringing a consistent culture and working style to bear, and starting on the path to growth are yet to come.
We’re all used to stories of organisations brought to their knees by inappropriate technology, forced upon them after an acquisition or divestiture. We think this is totally avoidable – and the key is to put the organisation’s needs before any technology solutions. So, here are some tips for ways to do just that following deal completion:
Key Steps for a Successful Technology Transition
Address Critical Risks:
Fix business-impacting risks identified in due diligence. Delays allow them to grow or materialize.
Deep-Dive Review:
Go beyond initial due diligence—engage more stakeholders to uncover hidden issues.
TSA Strategy:
Manage key tasks for a smooth transition. Use short-term solutions if lower-risk than TSA expiry consequences. Align migration assumptions.
Avoid Assumptions:
Choose technology based on fit for people, culture, and business needs—sometimes a tweak is better than a full replacement.
Strong Management:
Engage experienced project managers to oversee plans, internal teams, third parties, and dependencies.
Engage and Listen:
Leverage employees’ expertise; they want success under new leadership.
Clear Roles & Support:
Define responsibilities, empower key talent, and seek third-party expertise where needed.
This is all intended so decisions aren’t made based on what people ‘know’, what a salesperson recommends, or what Google (other search engines are available) tells them is ‘an industry-specific, best-practice driven system to meet the demands of the most complex business’. It’s a situation we’ve seen many times, and which persists despite rarely delivering results; we believe it’s time for a fresh approach.
If you’re taking the first steps in a newly acquired business, or you’d like to know more about our M&A practice, we’d love to talk to you. Wherever you are on the journey, we’re with you – contact us at m&a@waterstons.com, or read more on our website.
To read the other articles in the series, follow the links below:
Article 1 - Why do I need to be bothered about technology in my deal?
Article 2 -IT in M&A – what should I concentrate on?
Article 4 -Five Tips for successful Business As Usual