Mobilization is defined as the “the act of assembling and readying military troops and supplies for war” as per Wikipedia. This exercise is usually done in quick time and in a structured manner to achieve a high level of readiness to enter a war. Mobilization is a term that is also, commonly used in transformation projects including M&A integration. But when it comes to M&A Integration, there are multiple mobilization hurdles that one can encounter.
There are several similarities between getting prepared for a war and running a transformation project. Like in military, in M&A integration project you need to identify the required resources, prepare them, align them on a common mission, provide them with the right tools, share timelines and setup a governance usually in a short period of time.
In military, it is expected that once troops are assigned to a mission, the mission becomes the highest priority and, in most cases, the only priority. Like a war, an M&A integration is also complex maneuver with strategy, operationalization, synchronized performance, high degree of alertness and prioritization given.
M&A Integration is an intricate procedure of managing all that goes into the buy-and-sell of a company. It involves various stages of planning for the smooth transition or merger of both companies. Due to its complex nature, uncertainty, proneness to human errors and need to achieve integration in quick time, like a war, M&A integration also, needs to be given highest priority and a need for high level of mobilization.
When put correctly, it can be an essential part of growing a business.
Unfortunately, in real-life, most M&A integrations fail to be given highest priority and most of them, do not put much thought into proper mobilization.
The issue is not that organizations do not recognize the importance of an M&A integration. The issue here is that without explicit executive interventions, whenever an M&A integration gets pitted against any other organization priority, it loses the competition every single time. I will say it again, M&A integration loses the competition every single time to other priorities in an organization.
This is the reality of the current corporate world.
So, why does this happen? What are the hurdles that prevent a proper mobilization of resources for an M&A integration?
Here I will explain to you with 7 biggest mobilization hurdles for your M&A integration.
BUSINESS AS USUAL
Most resources engaged in M&A integration are sourced internally. Apart from a couple, these individuals have day jobs and certain responsibilities. When they are requested to join the M&A integration project, it is usually, in addition to their business-as-usual responsibilities. The organization intrinsically believes that the individuals will be able to handle both the requirements well.
But business as usual often throw curveballs. Every now and then, there are surprises that spring up during daily operations.
What happens then?
In most cases, it has been observed that business-as-usual always takes priority over M&A integration.
LITTLE ROOM FOR ADDITIONAL WORK
It is a common misconception that the volume of work required in M&A integration can be easily managed by individuals on top of their daily work. The assumption is that everyone at least has the capacity to take on 20% or more work at any given point in time.
Unfortunately, the reality is quite different. In an average corporate world, the kind of resources who need to be allocated to M&A integrations, juggle multiple priorities and are bursting at the seams with work. Putting any additional amount of work is likely to result in some priorities being dropped.
Guess what? Most of the time, it is the M&A integration ball that gets dropped. Surprised? I wonder why?
NO UPFRONT PREPARATION
Due to high levels of secrecy in an M&A transaction, organizations are not able to prepare up-front. Unlike other transformations like ERP implementation, new product launch, and new market expansion, which have long runways, M&A integration only gets a noticeably short window to prepare.
In most cases, the time between an M&A announcement and the date of change of ownership is only a couple of months. In some cases, it may be the same day.
Unfortunately, M&A integration planning always gets a short window to get ready. What is worse is that an M&A integration is more complex than any other transformational strategic initiative.
That is why, M&A integration must have a mobilization of resources that are akin to mobilizing troops for a war.
The CEO knows the importance of a specific acquisition. The corporate development team also knows the importance. Some members of the executive know this as well.
But the moment you start going down the organizational hierarchy, you realize that the importance of M&A integration starts getting diluted. By the time, it reaches line-management and front-line workers, M&A integration is as important as other priorities and their daily responsibilities.
Without a cohesive and aligned thinking along with a unified vision that is cascaded across an organization hierarchy, it is tough to maintain the importance of an integration.
The reason of the dilution of importance is two-folds.
Vision of the acquisition and the underlying rationale is not cascaded across the organization with the same zeal.
The acquisition rationale is not translated into new or additional operational objectives that can be understood and internalized by these individuals.
NOT INTERNALIZED THE URGENCY
As mentioned earlier, organizations neither get time to prepare up-front nor can get a long window for planning an integration. This creates a big challenge for any integration.
In a truly short period of time, organizations must prepare an integration plan, a synergies realization roadmap, assigning resources, dividing, and allocating budgets, conduct workshops, send out communication, create media releases, review contracts and several other things.
For an average individual, unless they have internalized the importance and required urgency, most of them would struggle to cope with the demands of an integration.
MEANS TO ACHIEVE OBJECTIVES
As mentioned in an earlier section, it is not enough to lay down just the objectives that are required by integration team members to meet. They must be given the right level of support, tools, and templates to be successful in the project.
Clarity must be provided on how these individuals are expected to achieve their goals.
This would translate into providing training, onboarding, acclimatizing with the details of the acquisition. They should be provided with technology and tools. They must be coached on how to use templates. They must be mentored on managing priorities, situational leadership, right-time escalation and providing timely updates.
Just as you expect them to perform and help in driving an integration successfully, it is imperative that organizations provide them with the right means to achieve their objectives successfully.
INCENTIVIZATION AND CONSEQUENCES
Probably, the biggest hurdle in an integration mobilization, is the lack of clarity on incentives as well as consequences of non-adherence.
WIIFM, What is In It For Me, is commonly, not addressed in most organizations, when individuals are asked to contribute and participate in an integration.
Some companies try to assign some monetary incentives for their senior executives but for most of the other participants, it is expected that they will perform and contribute to an integration without the necessity of an incentive.
What is worse, is that an M&A integration objective is loaded on top of their already heavy goals and objectives. There is truly little to no incentive for them to take on this additional burden.
On the other side, hardly any organization pays heed to situations where individuals do not comply or fail to achieve their objectives. While it may pose some questions at a senior level, by the time it comes to line-management and front-line workers, the consequence management is non-existent.
As long as these individuals continue to deliver on their daily operational work, their misses on integration activities are overlooked without any consequences or reprimands. And as they are not reprimanded, they start missing integration objectives with open disdain and it soon becomes an epidemic in an organization.
M&A integration is not a light maneuver.
It is a merger of two companies, or one company being absorbed into another one. And yet, I find the levels of mobilization that companies embark on appalling and the apathy accompanying it.
Majority of M&A integrations fail. But they do not have to.
Organizations must become smart and take heed of these points in their integration.
If you can be successful by taking these measures, then why won’t you?
Only you can tell.
This article is written by Anirvan Sen.
It is edited and keyword optimized by Blanca Monni.