The global pandemic has hit the global economy hard. With most countries in recession and advanced economies projected to shrink by 7%, mergers and acquisitions (M&A) certainly took a nosedive through Q1 and Q2 of 2020.

Deal volume fell by 49% in the first half of 2020, while the value of deals dropped by 22% compared to the same period in 2019. But the M&A bounce back has already started. Activity across Q3 and Q4 of 2020 has surged ahead of 2019 figures. From Nvidia’s buyout of Softbank and Arm to RWE’s asset swap with E.ON, M&A activity was alive and well in 2020 despite the downturn.

“What do we do now!?”
Are companies using mergers and acquisitions to accelerate their digital transformation journeys? Or is consolidation the best way to deal with the fallout from the global pandemic? Whatever the reasons, one of the most difficult and frightening stages of any M&A deal is the migration of one IT system to another.

Avanade has helped many companies through their M&A journey, Antares Capital, RWE, Siemens, and Towergate. From due diligence to integration planning and user testing, we know exactly how to avoid the most common dangers on the road to M&A success.

3 M&A dangers and how to solve them

Danger #1: Obsessing over tech
Tech isn’t the answer when it comes to delivering a smooth M&A integration or separation process. Alignment of policies, change management, and how you deal with application and service co-existence are far more important.

Technology is often at fault for around 40% of M&A failures, with the top five reasons for failure being IT-related. Why? Because too many organisations believe they can IT tools aren’t much use without expert implementation and integration. Software providers can deliver the goods, but not the skills, which is why Avanade has designed a selection of M&A accelerators to make tenant-to-tenant migrations smoother and simpler.

Danger #2: Overlooking the employee experience
It’s not just the migration itself that’s important. In the rush to get two businesses connected, it can be easy to forget about the employee experience. The period of transition is the most challenging time for many employees, as computer systems are aligned, phased out or replaced with something completely alien.

While productivity can be a casualty, so can morale and satisfaction levels. Avanade keenly understands the challenges of workplace experience in an M&A situation. In our experience, a merger or acquisition needn’t be a nightmare for employees – quite the opposite: M&A is an excellent opportunity to rethink and improve your employee experience. It’s one of the reasons we advise our customers to carefully design the user journey to maximise the quality and consistency of the workplace experience before, during and after migration.

Mergers and acquisitions are usually accompanied by a sense of ‘us versus them’, a feeling of working with ‘that other company’. You need a set of guidelines to help bridge the gaps. Collaboration tools like Microsoft Teams, when deployed intelligently, can help foster closer working relationships and help two unfamiliar teams work like one.

What’s more, there are plenty of opportunities to use workplace analytics to understand where the employee experience is weakest. Only then can you address those gaps, either through coaching or solving technical issues. Workplace Analytics, used in conjunction with real business data, can help spot the best performing teams, allowing the organisation to learn from these successes and replicate them across the board.

Danger #3: Failing to keep stakeholders engaged
Again, another point that emphasises the ‘tools are not enough’ philosophy. Any migration will face challenges and keeping everyone engaged and prepared will result in happier employees and satisfied internal clients.

Migrating and merging systems is, by their nature, complex activities that require careful planning, piloting and listening to users and stakeholders. It is also important to understand what the support framework looks like before, during and after migrations take place.

Why partner with Avanade?
M&A processes are technically complex work with a huge dependence on IT. Yet migrations are an opportunity to go beyond ‘business as usual’. It’s a chance to improve and enhance what your organisation was accustomed to before the migration.

Avanade has the technology experience because we were born from a pure tech background, but over the years we have developed market-leading skills in change management, business processes and workplace cultures. In short, we combine the best of both worlds, both tech and business.

We’ve already successfully completed hundreds of migrations, including our NextGen Active Directory migration work for Siemens. The engineering giant performs regular acquisitions around the world, but technical integrations were taking too long. To help Siemens speed up its migrations, we reduced its Active Directory infrastructure by two-thirds and gave it the tools it needed to reach a run-rate of 25,000 migrations per week.

Considering or already actively engaged in an M&A process?
We recommend Avanade’s two-hour workshop to help you better understand the workplace challenges – and solutions – ahead of you.