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Over the last decade, we have seen significant increase in number of mergers and acquisitions and this has led to a need to develop an efficient process to quickly integrate the IT system of the acquired company without that it will be difficult to timely and accurately manage the acquired company. Also any delay in smooth integration will delay the planned benefits of merger or acquisition.

Some of the general best practices for involvement of IT organization in the whole acquisition process and there after are:

  • Given the complexity involved and the varied IT systems implemented in many companies, it is essential to consider all integration factors as early as possible in the acquisition process
  • Formalizing the relationship with the acquired company IT staff early in the transition process significantly reduces issues with transitioning
  • Budgeting requirements for systems integration should be included in transition costs for the acquisition. If capital requirements for integrating applications and infrastructure systems are considered late in the process then necessary funding and resources may not be available
  • The senior acquisition management team, while recognizing the sensitive negotiations process, should keep the CIO and few more senior IT leaders in the loop. If IT involved too late in the process, then it will result in insufficient time to plan the integration of the systems and processes and hence failure to deliver on the financial and commercial plans
  • Get an understanding of the acquired company’s IT organization, systems and infrastructure, and integration issues early in the process. Also develop a high level transition plan as this will help avoid nasty surprises
  • Consider IT as business partner similar to Supply chain, HR,Finanace, and Demand team
  • Conduct IT due diligence at the same time when Supply chain, HR,Finanace, and Demand team are their due diligence
  • Once deal has been signed then develop a transition Plan with immediate-, med- and long-term projects and activities
  • Put a dedicated team with designated leader for integration of systems and process

Sometime both acquirer and acuruiree are on SAP system and sometimes only one is on SAP but future platform of choice is SAP. In this blog, I will talk about situation where future platform will be SAP. These kinds of projects are more than just migration and needs to be planned carefully to be successful. I will try to give a peek at some of challenges which need to be carefully planned and executed to be successful:

 

Challenges

Key Activities to overcome these challenges

Business process harmonization

  • System due-diligence
  • Business blue print workshops
  • Detailed blueprint document highlighting change management
  • Solution walkthrough…envision changes
  • Driving the change management throughout the project life cycle

Master data harmonization

  • Validation of master data in both organizational units
  • Validating configuration design there can be several difference in the way customer/material/pricing data is stored at organization level
  • Identifying duplicate master data and potential data cleansing opportunities
  • Mock upload of real time master data for integration testing
  • Regression testing across processes

Development objects

  • Identify all development objects during business blue print and harmonize sales organization specific logic
  • Custom program to identify hard coding for sales organization
  • Carry out delta changes as necessary and test them vigorously with real time data

Configuration design conflicts

  • Validating configuration differences
  • Visibility of all potential conflicts in blue print document
  • Sensitizing change management on account configuration design
  • Driving the decision on such conflicts with appropriate stakeholders
  • Thorough testing

Reports variants

  • Update of all organization specific variants

Data migration

  • Analyzing intensity of change
  • Deliberate the best approach to migrate – LSMW, BDC
  • Exhaustive cutover plan depicting accurate timeline with roles and responsibilities
  • Conversion and cutover document depicting key migration points on each object

End user training

  • Delta end user training manual with train the trainer approach

 

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2 Comments

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  1. Richard Hirsch
    Hi,

    The formatting with your blog is totally broken which makes the content unreadable. 

    You may want to try cleaning up the HTML in the editing environment and try publishing again.

    D.

    (0) 

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