Leading An Acquisition Integration? Be BRAVE.
We know that 83% of mergers fail. We keep doing them because the upside to success is so huge. That success comes only when the vision, values and integration are right. While the CEO must own the vision and values, having a separate integration process leader reduces risk and accelerates progress. You can best lead that integration with a BRAVE outside-in approach:
- Environment – Understand the context and type of integration you’re leading.
- Values – Clarify what matters and why to the CEO and other key stakeholders.
- Attitude – Make choices around strategy, culture, organization, operations, and your own role over time.
- Relationships – Build mutual trust and confidence with the top leadership team, the integration team, and the combined organization’s future leadership.
- Behaviors – Accelerate to future capabilities.
Start by understanding the type of integration you’re leading – which may be different for different parts of the new entity:
- Acquired company B folded into acquiring company A (The default approach)
- Acquiring company A folded into acquired company B (Where it makes sense)
- Merging company A and B together to form something completely new (More complex)
- Keeping A and B separate while adding strong links between the two (Less synergistic)
Values/What matters and why
You don’t get to decide what matters and why – mission, vision and values. Those are determined by the CEO, board, and/or owners. But you can’t lead the integration until you understand what they really care about, their thinking and intent in depth.
Mergers are major points of inflection. The core nature of the business across design, produce, service, or deliver drives every other choice. Pay particular attention to the cultural integration, merging one culture into the other (more straightforward) or combining them to make something entirely new (more complex and risky.)
The integration leader role is unique in that it’s part interim leader, part deputy, and part program manager and air traffic controller.
The role is part interim leader because it ends when the integration is complete. Think about where you want to go next. Do you want to be part of the future leadership team, go back to the parent organization, move on to the next integration? That will affect how you think about the various relationships.
It’s part deputy because you’re implementing for the CEO, Board, and/or owners’ vision. While you will make some tactical decisions, make sure you’re aligned with the CEO, board, and/or owners every step of the way.
It’s part program manager and air traffic controller because you have to bring order to chaos, linking current leadership team, integration management team and future leadership team.
In times of change or crisis, people retreat back down Maslow’s hierarchy. Their first question is always, “What about me?” Remember this as you build your relationships with the CEO and top leadership, integration leadership (including the board, owners and PE leadership,) and broader future leadership team. As Theodore Roosevelt said, “No one cares how much you know until they know how much you care.” You have to build relationships before you can lead anyone.
In particular, pay attention to the CEO – especially if you were dropped in on them. In that case, invest in building trust in the face of possible distrust or resentment. Jump-shift your loyalties immediately. 1) Disengage from your previous situation – especially if you were part of the board or ownership group; 2) Engage with the CEO as your new boss; and 3) Do what is required to accelerate the integration’s progress – in that order.
Ultimately acquisition integration is about accelerating to future capabilities.
- Imperative. Start with the end state. Get all aligned around the imperative: mission, vision, values, core strategies.
- Future organizational capabilities. Those strategies will inform the future organizational capabilities you’ll need to implement them.
- Current reality. Take a hard look at the capabilities you’ve got in both the current acquiring organization and acquired organization.
- Bridge the gaps. Now operationalize the change. Build the required cross-functional and cross-entity integration teams. Lay out plans and milestones on the way to the integration. Manage them on a regular basis, picking, delivering and highlighting early wins along the way to give the team confidence in itself.
- Communicate up, across, and down on an ongoing, periodic and regular basis. You can’t over-communicate in an integration. The more people know, the better.