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Integration Director
• Able to guide the integration process by means of leadership able to overcome:
• the risk of cultural clash
• the risk of possible clashes between different management styles
• the risk of personnel turnover
• The quality of such complex individual involves both of the two crucial sides:
the technical and human
• [as] Mentor:
• is considered has used his skills successfully on multiple projects and can
supervise/mentor/coach others on his skills
• possesses effective presentation and strong written and verbal communication skills
• [as] Transformational leader:
• personality, leader’s behavior, technical competence, tactics he can use in order to exert his
influence;
• creativity, boldness, craving to succeed and strong determination;
• strong charisma, through which he is able to create an ideal vision in his followers and to
install a sense of trust and loyalty towards him;
• emotional appeal (or empathy), by way of which he is able to communicate his vision
motivating followers;
• sense of creativity at intellectual level, through which he is able to make people focus on new
ideas and problem solutions;
• high consideration for individuals, i.e. is always disposed to listen to his people’s problems and
ideas in order to motivate them and to receive continuous feedback on his choices.](https://image.slidesharecdn.com/post-acquisitionintegrationvd151207-151207163414-lva1-app6891/75/Post-acquisition-integration-cross-border-case-29-2048.jpg)
Uploaded byVirgilijus Dadonas
Post-acquisition integration (cross-border case)
The document discusses various topics related to mergers and acquisitions (M&A), including M&A strategy development, the acquisition process, integration phases, due diligence, portfolio/program/project management, and post-merger integration (PMI) capabilities. It provides frameworks, checklists, and outlines key elements of M&A strategy, deal execution, integration planning, and value capture through successful post-acquisition integration.
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Post-acquisition integration (cross-border case)
- 1. 1 Post-acquisition integration Practical questionsincase of cross-border acquisition Virgilijus Dadonas M&A
- 2. 2 Framework of thetopic M&A strategy development | M&A process | M&A as corporate and business strategy | Integration phase in M&A | Acquisition process | M&A synergies | M&A challenges | ST: M&A value leak | Smart elements M&A Due Diligence Integration DD process | Optimization planning during DD | DD check-lists | Smart elements Portfolio, program, project | PMO | Integration success drivers | PMI organization & Integration Mngt Office | Integration Director vs Integration Manager | Integration planning & execution | People Integration & Emotional Mngt | Communication | Cultural dimension | Hot spots of integration | Integration challenges | ST: Stakeholders communication; Decision Mngt; PMI case; PMI Mngt roles; Being agile | Smart elements
- 3. 3 Mergers Acquisitions Vertical Concentric horizontal Conglomerate Valuedrivers Cross-Border domestic intellectualproperty accesstocustomers naturalresources industrialassets humancapital Scale Scope Programmatic Organic large tactical Selective Marketcap Valuechain Economicarea Topdrivers Customers Distribution Buildvs Buy Keepvs Sell GrowvsShrink Integratevs Manageseparately Synergy Speed Survival leverage Criticalmass diversification riskspreading eliminaterivals acquisitionofcash marketdominance excessdebtcapacity Strategicrealignment Salesmaximization Undervaluedassets Competitivesize protectmarket gainfootholds deferredfax power absorption equalmerger equityinjection M&Anarrowconcept Completetakeover majority minority Businesscooperation managementoutsourcing jointventure Cooperation franchising minoritycross-ownership holding Assetcooperation Reverse triangular merger Roll-Up Stockacquisition managerialism mismanagement managerialhubris
- 4. 4 M&A development Manage the Transaction •Establish robust process for due diligence • Communicate effectively to manage the regulatory approval process Achieve PMI • Formulate and refine the PMI plan • Customize the governance structure • Cultivate globalized talents • Close the cultural divide Build up relevant capabilities and manage changes Develop clear M&A strategy • Align with corporate vision and industry trends • Establish a mechanism for strategy review and revision Clear M&A strategy is fundamental Developing relevant capabilities is critical Effective implementation is key
- 5. 5 M&A process Pre-M&A Planning Deal Execution Post-M&A Integration Formulate M&A strategy Selectand screen the targets Negotiate and agree on the deal Built robust integrated organization Integration = Due Diligence + Post-merger integration = Value capture Transfor- mation First – integration, then – transformation
- 6. 6 Integration as partof corporate strategy Corporate Strategy Business Strategy Corporate Target company Corporate growth strategy M&A strategy Where to invest? How to compete?
- 7. 7 Integration phases Phase 1 Integration preparation Phase2 Integration planning Phase 3 Integration execution Phase 4 Transition to business Deal announcement / signing • Signing of the SPA • Official announcement of deal (conditional on regulatory approval) Day 1 / closing Transfer of ownership and “go live” Major milestone achieved Official end-date of integration by realization of major milestones Regulatory approval Approval of deal by regulatory authority
- 8. 8 Acquisition process from buyerside Discussions: • Right contacts • Matched intents Initial acquisition assessment Targets: • Identification • Screening / evaluation • Selection Targeting Preliminary discussion Exclusive commitments & discussions Non-disclose (confidentiality) agreement (NDA) Preliminary valuation model VM1 Business case for internal acquisition approval AA1 Letter of Intent (LoI) Preliminary acquisition proposal AP1 Transaction process clarification
- 9. 9 Acquisition process from buyerside Acquisition proposal AP2 for negotiation incl. SPA Negotiation: • Price • SPA • Trading concessions Draft agreement Final internal acquisition approval AA3 Final acquisition approval AP3 = SPA Information request lists DD: • Legal (& Regulatory) • Financial & Tax • Commercial / Business • Operational • HR & Payroll • (Cultural, Environment, Technological, etc.) DD Report Revised valuation model VM2 Pre-negotiation internal acquisition approval AA2 Due Diligence Deal negotiation Transaction closing SPA signing Regulatory approval (if needed) Closing Integration (cont.)
- 10. 10 M&A synergies Cost Improved market access Financial Economiesof capital market Market power Economies in innovative activities Scale economies Removal of redundancies Diversification Managerial efficiency Consolidation of functions Supply chain Procurement Market knowledge Tax benefits Negative synergy Growth Synergy objectives Return
- 11.
- 12. 12 Value leak is themajor post-deal issue… Time Revenue M&A integration Running revenue Pre M&A planned revenue Post-M&A achieved revenue • Acquisition of revenue • Synergy Revenue gain pre-M&A post-M&A Exit Closed integration?
- 13. 13 Value leak … thatcan be addressed by focusing on Through early planning and communication Preparation People Speed Focus Post-deal key success factors Maintain momentum from deal completion First execution especially during first 100 days Concentrate resources and time on value drivers and opportunities Earnings growth + Operational efficiency + Risks mitigation while ensuring day-to-day
- 14. 14 Smart elements ofM&A Many acquisitions look great on paper… ● All M&A require robust, disciplined project management ● Every deal is UNIQUE ● Signing of a deal is not the end - it is really the beginning of the real work to REAKIZE VALUE from the acquisition ● Other people’s best practices work best in other people’s companies ● Companies seek to access customers in different ways ● Some mergers are doomed from the beginning ● Success or failure cannot just be delegated ● To control the integrity of the deal price and avoid irrational movements within the company and the market, M&A deals must be highly CONFIDENTIAL ● Synergy targets need to be rooted in SOLID business plans ● MEASUREMENT drives achievement ● High-performing M&A projects take less than 6 months to move from a non-disclosure agreement to a binding offer ● Inflated expectations and assumptions result in lack of discipline and perspective ● Management cannot enter the deal process without being prepared to walk away from a target ● The STRATEGY is more important than the target ● Post-acquisition performance measurement helps management CONTINUOUSLY educate itself ● Value is not created until successful integration of target entity ● Measurement is an ONGOING process designed to provide members of the various M&A stages teams with real-time feedback ● M&A team needs to better understand and define the END-STATE vision ● One-size does not fit all types of deals ● Do a better job of identifying the acquired company’s capabilities and where the true synergies can come from ● Set more REALISTIC timeframes to achieve objectives ● Don’t fall asleep having high-level M&A model which lacks specific steps or instructions needed to actually GUIDE actions ● Size slows speed and dilutes accountability ● Success of deal is only achieved when EVERYTHING works together as it should, not simply when budget projections are met ● There is no value in prolonging a deal negotiation ● SPEED allows you to exploit post–deal opportunities on your own terms
- 15.
- 16. 16 Due Diligence process DueDiligence Understand the transaction • DD organization and management • Communication • Information request lists • Questionnaires (check-lists) adjustment 1 stage: • Complete questionnaires • Conduct on-site surveys • Conduct interviews 2 stage: • Review responses • Additional information clarification (Virtual) Data Room? • Analyze findings (reports) for every DD accomplished • Risks assessment • Identification and validation of value drivers • Synergies evaluation • Gap analysis & cost of integration calculation • Summarize DD findings and develop DD report • Issues: risks, opportunities, critical needs, important issues, cost implications • Initiatives: risk mitigation, opportunities leverage, business need, dependency between functions • Present results to seller and discuss ‘hot’ issues Adjust valuation model
- 17. 17 Transformation pre-planning Increase Eliminate Create Reduce What are attributes, activities, services toincrease What are attributes, activities, services to reduce What are attributes, activities, services to create What are attributes, activities, services to eliminate + + - - See prospectively: chose between business processes optimization (improvement) and re-engineering
- 18. 18 Due Diligence check-lists Business/ Commercial Legal HR Regulatory Technology Cultural Financial Operational Environment Corruption Intellectual property Data protection Tax Payroll Antitrust & politics IT Information security Accounting Market Sell Side DD review Buy Side LimitedDDreviewaccesslevelFull Customers
- 19. 19 Smart elements ofDue Diligence DISCIPLINE, DISCIPLINE, DISCIPLINE ● DD has only LIMITED ability to set accurate expectations of the total synergies available in a deal ● DATA PRIVACY is crucial ● Ensure that the deal timetable allows sufficient TIME for thorough DD to be conducted ● Allow extra time to understand the pre- and post-regulatory requirements, create relationships with local stakeholders incl. state/political institutions ● Corruption DD clean up a way to fix shortcomings identified ● If M&A team does not do its homework, it may find that company come under scrutiny from regulators complaining ● Understand the business OBJECTIVES behind the acquisition ● PRIORITIZE DD efforts and determine what information is important to review, and what can be skipped ● SPEED is a critical driver of success ● For effective DD team relevant and timely industry EXPERIENCE is crucial ● Checklists are helpful for guidance, but should not be used to just ‘check the box’ ● No DD investigation would be complete without a personal ONSITE manager visit ● Just because everyone on the team is skilled at DD does not mean that they necessarily will understand each other's findings ● The key to DD lies in ASKING the right follow-up questions at the right time ● ‘One size fits all’ approach may not always work in DD ● Due diligence often sounds easier than it is ● You will never get all data you need - learn to live with INCOMPLETE data and use your own judgment to fill in the gaps ● All transactions usually move to the acquirer’s system footprint ● Finding the RIGHT PMO and putting functional teams in place is an essential first step ● Consolidation is time-consuming ● Manage the pre- planning regime like the execution phase (90/60/30 days) prior to Day 1 ● There are no improper questions ● What may be seen attractive from the outside may look entirely different when you take full control
- 20.
- 21. 21 PMI capabilities 1 2 34 5 6 Customer engagement Program management & integration planning Thefive S’s Targets and tracking Change management communication HR processes • Strategic logic of the deal • Spirit of integration • Speed of integration • Systems to be chosen • Scope of integration 1 • Team structure and launch • Cross-team coordination • Issue management • Integration design process • Preparation for Day One 2 • Employee morale • Stakeholders • Cultural integration planning 3 • Integration objectives • Synergy targets setting • Implementation milestones and benefits tracking 4 • Retention planning • Selection process 5 • Customer risk management • Customer experience management • Customer input 6 PMI capabilities Based on: BCG
- 22. 22 Portfolios, Programs, Projects Project doingthe project right Program doing the right projects Portfolio Management • Enterprise-wide perspective • Strategic goal alignment • Investment mix • Market and shareholders driven • Adjust to market conditions/ opportunities/ changing priorities Program Management • Business-area perspective • Benefit stream realization • Alignment of related projects • Roadmap of value Project Management • Well defined boundaries • Capability delivery • Budget, scope, schedule • Team delivery • Requirements management • Architecture design • Development • Test TACTICSTRATEGY STRATEGIC GOALS Are we working on the right project? Are we investing in the right direction Do we have the right resources to be competitive? TACTICAL GOALS Are we carrying out projects well? Are projects on time and on budget? Do project stakeholders know what they should be going? Portfolio selecting right things to do
- 23. 23 Basic types ofPMO Portfolio/Program/Project Management Office Program PMO Project PMO Corporate PMO Business PMO Temporary Permanent Higher Lower Hierarchic position Expected life span • Portfolio management office - provides support at a strategic level within the governance and strategic project selection and management domain • Program management office - tends to provide strategic and centralized support to the program, including the management of shared resources, methodologies, tools and techniques • Project management office - provides centralized and coordinated management or support of those projects for which it is responsible
- 24. 24 Business Development functional management Hierarchicposition Strategy Tactic ProjectProgramPortfolio (e.g.) Company:vision & mission Strategic goals BDportfolio Program A Project A1 Program B (M&A) Project B1 Project A2 Subproject A2-1 Subproject A2-2 Project B2 Project C1 ……… Business-as-usual
- 25. 25 Project Management Office(PMO) PMO Supportive PMO provides a consultative role to projects by providing templates, best practices, training, access to information and lessons learned from other projects. Degree of control - low Directive PMO goes beyond control and “takes-over” the projects by providing the project management expertise and resources to manage the project. Degree of control - high Controlling PMO provides support and require compliance through various policies. Compliance may include adopting project management frameworks or methodologies, using specific templates, forms and tools, or conformance to governance. Degree of control - moderate Support Direct Control PMO is a management structure that standardizes the project-related governance processes and facilitates the sharing of resources, methodologies, tools, and techniques. M&A Integration
- 26. 26 Integration organization Integration Team •Functional/project experts • Teach & Support • Drive & Control Integration Steering Board • CEO, CBD, RD, PMI,… Functional Managers • Local management • Learn • Implement Integration Director Integration Manager Integration Management Office Decisions management PMI Project Finance PMI Project Operations PMI Project IT PMI Project HR PMI Project HO PMI Project Communication PMI Project Commerce Special-issue teams • Temporary units
- 27. 27 Integration Management Office IntegrationDirector vs Integration Manager INTEGRATION DIRECTOR • Strategic level • Mentor/Coach • Advice/Help • Facilitate • Review • Project management sponsorship • Knowledge management INTEGRATION MANAGER • Tactical level • Execute/Manage • Plan/Organize • Initiate • Control • Technical project mngt • Identify • Stakeholders identification and communication Leadership Integration Manager is linked to PMI phase of definite integration project Integration Director is linked to pre-, PMI, and post- integration strategy of the company
- 28. 28 Integration Management Office IntegrationDirector vs Integration Manager Transformational Leader/ Deal Owner Project Manager Outside traditional specialist expertise Integration Director Lead the effort Strategic leadership Operational responsibility Managerial leadership Technical project management Integration Manager (cont.)
- 29. 29 Integration Director • Ableto guide the integration process by means of leadership able to overcome: • the risk of cultural clash • the risk of possible clashes between different management styles • the risk of personnel turnover • The quality of such complex individual involves both of the two crucial sides: the technical and human • [as] Mentor: • is considered has used his skills successfully on multiple projects and can supervise/mentor/coach others on his skills • possesses effective presentation and strong written and verbal communication skills • [as] Transformational leader: • personality, leader’s behavior, technical competence, tactics he can use in order to exert his influence; • creativity, boldness, craving to succeed and strong determination; • strong charisma, through which he is able to create an ideal vision in his followers and to install a sense of trust and loyalty towards him; • emotional appeal (or empathy), by way of which he is able to communicate his vision motivating followers; • sense of creativity at intellectual level, through which he is able to make people focus on new ideas and problem solutions; • high consideration for individuals, i.e. is always disposed to listen to his people’s problems and ideas in order to motivate them and to receive continuous feedback on his choices.
- 30. 30 Roles of IntegrationDirector during PMI • Communication facilitator • figure out a shared vision to the two previously separated companies and their teams, strategic intents/objectives and directions; • promote cooperative atmosphere between the integration teams; • promote the spread of creativity, new ideas and knowledge. • Transformational leadership • he is seen as an individual with a clear integration plan in mind, trustable, competent and seriously interested fortune of the acquired company; • enhance exchange mutual competencies; • inspire individuals, achieving their commitment and conquering their trust; • prevent loss of motivation and immediate consequential people’s turnover. NOTE: Stereotypical M&A case: Traditional approach when M&A team is responsible for deal making while Operations team - for integration leads directly to loss of continuity of M&A+PMI process and deterioration of accountability for acquisition targets → Integration Director should be the unifying factor representing top management
- 31. 31 Roles of IntegrationDirector during PMI • Organizational buffer • alleviate the pressure on the integration teams from the top management arising from • the necessity of the acquisition promoters to validate their business (acquisition) case in front of the investing stakeholders, • the need to have the top management approval and legitimization, • request of "immediate' results (short-termism) that from operational and/or strategic and/or financial point of view seems to be unattainable; • inconvenient requirements coming from the integration teams that could compromise the whole integration process success; • mitigation of cultural clash between the two teams. • Network facilitator • widespread the results of integration and promote new knowledge/ideas obtained and creativity through the entire organization; • act as moderator of interaction among various individuals, who operate in different parts of the organization and, therefore, do not know each other (even though they would need to). (cont.)
- 32. 32 Integration Manager Competencies &skills An effective integration project management requires that the project manager possess the following competencies: • Knowledge - what the integration manager knows about project management; • Performance - what the integration manager is able to do or accomplish while applying his project management knowledge; • Personal - how the integration manager behaves when performing the project or related activity. Personal effectiveness encompasses attitudes, core personality characteristics, and leadership, which provides the ability to guide the project team while achieving project objectives and balancing the project constraints. Some highly desirable interpersonal skills of an integration manager are: Leadership | Team building | Motivation | Communication | Influencing | Decision making | Political and cultural awareness | Negotiation | Trust building | Conflict management | Mentoring
- 33. 33 Integration Manager Roles &Responsibilities Integration project manager is the person assigned by the organization to lead the team that is responsible for achieving the project objectives. They are the people responsible for managing the project processes and applying the tools and techniques used to carry out the project activities. Good integration project manager should have a variety of skills. In general, his roles and responsibilities are to satisfy the needs: • task needs • team needs • individual needs A project manager's typical responsibilities include: • Planning and organizing the work • Managing the day-to-day activities of a project • Delivering the project deliverables
- 34. 34 5 drivers ofintegration success Communication Integration strategy Integration teamSpeed Aligned measures 1 Acquisition integration success drivers Create impression that acquired company was “always there”. Acquired company adopts practices of acquiring company. 1 Small, distinct team with enough resources and contributions from senior management. Leadership remains from acquired company. Customers of acquired company must understand new opportunities in business. Employees of acquired company must understand new roles. Focus on how acquired company fits into acquiring company’s business. Fast decisions are key for both strategic goals and promoting stability and reducing uncertainty in organization. Focus on how acquired company builds growth and optimizes operations. Acquired company adopts measurement systems of acquiring company. 2 3 4 2 3 4 5 5
- 35. 35 5 factors ofintegration success Ongoing communication with stakeholders in order to maintain stability and provide a platform for solid performance post-closing. 2 Key employees often have experience and knowledge that are vital to maintaining consistent operations. Losing these individuals can be devastating to the long- term success of the deal. Creating environment and behavior that inspire a shared sense of purpose, coherence, community and trust, enable employees to focus and to remain highly engaged during post-closing integration. See previous slide. Developing integration structure and policies that enhance and leverage the best practices. Determining the reports and indicators management will need to monitor the acquired company’s operations during the transition 3 4 1 5 Key employees retention Developed integration drivers Business relations retention Cultural alignment Reporting system 1 Acquisition integration success factors 2 3 4 5
- 36. 36 Integration planning &execution Integration Steering Board Set direction and monitor Integration Project Office Coordinate and control Integration Team Plan and implement Decides on strategy, infrastructure and resource allocation Ensure alignment of initial plans with overall direction Monitors implementation and ensures rapid actions Assesses environment & opportunities and builds initial integration plan Reviews & consolidates plans and ensures implementation Builds detailed integration plans and implements
- 37. 37 Integration phase Feasibility /Investigation Due Diligence Analysis Transformation direction Integration Plan Integration process Milestones Review Integration Review Integration Plan Design Integration Plan Milestones Review Integration process Implementation Integration process Monitoring Milestones Review Execute Control (Refine) Plan Lessons learned & feedback Transformation Optimization Integration capacity upgrade for next M&A project Audit
- 38. 38 People integration Culture People cost Structure Engagement TalentRegulatory People related risks identification Culture risk People cost risk Structure risk Engagement risk Talent risk Regulatory risk Risk Heat Map Proactive addressing the key people and organization related risks Effective change management: • Organization level • Teal level • Individual level Leadership: • Visible • Recognizable • Constructive DueDiligenceIntegration People integration planning to be done based on the Risk Heat Map
- 39. 39 Emotional phases duringPMI Stress management Self-esteem Time Shock Denial Anger Depression Acceptance Experimentation Discovery Integration E. Kubler-Ross’s (1970) G. Weinberg (1997) Old status quo Integration in practice New status quo Performance Transforming idea discovered Acquisition Stress Support Change Role Relation- ships Control Demands 1. Forming Ending Neutral zone New beginning
- 40. 40 Leading integration Communication strategy Createtrust Engage and motivate employees through clear, consistent and regular communication, while maintaining a focus on business as usual Day One Create influence Communicate with credibility and influence to all stakeholders, while realigning operations to achieve the acquisition targets Create vision Communicate mission and long- term direction, while embracing short-term integration challenges Integration mission completed? 100 days Remember The Pyramid of Employee Needs? Inspire… Engage… Satisfy Pre-announcement Agile Project Management Estimating by real value = estimate size not duration
- 41. 41 Media effectiveness tool poster notice cascade briefing hotline chartroom/shared database website/e-learning audio video broadcast e-mail v-mail newsletter booklet attitude survey personal letter forum road show away day Q&A/feedback web-based conf-call interactive staff attitude survey conference staff meeting training/workshop interview with stakeholders e-newsletter workshop staff meeting conferencefocus groups website/eRoom regular e-mails/newsletters strategic & operational meetings planning workshops team events review/ feedback sessions electronic/web face-to-face Methods / Materials Communicationobjectives INFORMEDUCATEINVOLVEMOTIVATESUPPORT TRANSFORMACTACCEPTUNDERSTANDAWARE Engagement of employees print/ artefacts De Haldevang (2009)
- 42. 42 Cultural dimension consideration Risktolerance Individualism Uncertainty avoidance Organizational culture Collectivism Motivation & rewards Management style & decision path Relationship Power distance Self- image Punctuality Masculinity Distance Time orientation Communication Feminity Cultural context National Professional Occupational Organizational
- 43. 43 Cultural aspects incross-border acquisition Leadership culture Organizational culture National culture Cross-border M&A Country environment Political (in-, ext-), economical (in-, ext-), social, education, regulations, infrastructure, history, geography, climate, culture, behavior Teamwork at top level Governance & management style, education, collaboration, personal & professional alignment, networking Integrating company norms For decision making, top-down management, structure, internal P&P, communication, change, risk acceptance, problem solving, creativity, pay system & incentives
- 44. 44 Culturo-operational integration Social integration Emotional integration Intellectual integration Operational integration Shared • Knowledge •Expertise Standardized • Management • P&P • Infrastructure Collective • Commitment • Performance Common • Identity • Purpose
- 45. 45 Process vs Projectmentality Project TECHNICAL aspect Time Resources Goal Fixed short-run goal Process TECHNICAL and SOCIAL aspects Short-run goal with long-term context Time Resources LEARN Integration
- 46. 46 Hot spots ofintegration What could go wrong? People PreparationExecution • Cultural conflict • Conflict between management teams • Loss of key people • Lack of executive commitments • Lack of attention to people issues during implementation • Late integration pre-planning • Overpayment for acquisition • Overestimated synergies • Weak DD • Lack of clear priorities • Low/no integration budget • No IMO (or integration team), no clearly defined roles and responsibilities • Missed targets, no focus on original planning • Poor control and reporting • Poor communication • No end-state planning
- 47. 47 Culturalconflicts Coachingvs mentoring Stressmanagement Post-acquisitionchallenges Leadership Failedintegrationlessons Changemanagement purpose Successfactors internalvsexternal Organizationallevel individual/temlevel programlevel agilecoaching Cross-culturalcommunication Changefactors&drivers Organizationalculture degreeofchange Culturebasics Organizationalvsnationalcultures Communicationdifficulties managementstyles languagebarriers Conflictingvalues ‘them-Us’syndrome Culturalshock Stressaudit mergerpreview ‘pressurecooker’ emotionalsyndrome individualcounselling retainingkeyemployees overcomeculturaldifferences integrationsystems&processes Optimize&integratesupplychain balanceintegrationactivitieswithrunningbusiness realizesynergy retainingcustomers people preparation execution Communication managementcontradictions Changethroughpersuasion processvs projectmentality dysfunctionalroutines Changeprocesssteps Changedimensions Mentality doing deciding project process discerning discovering Integration Challenges Culturalintegration
- 48. 48 Stakeholders communication circle Determine communication needs Identify stakeholders Communicationcircle (process, not event!) with stakeholders - how to create, monitor and influence stakeholders reaction to every your company action # and availability of stakeholders Businesscomplexity Complex Complicated Simple
- 49. 49 The decision drumbeat 42 1 3 DISCIPLINE do it right in right language Based on: Bain & Company FOCUS Prioritize – identify value, results you expect, and by when 1 Execute Coordinate critical decisions – focus on results vs decisions in right order 3 Resources Assign decision rights and roles – allocate resources incl. the right people and communicate that to all involved 2 Measure Measurable KPIs – focus on results vs decisions, not on process for process’s sake 4 Integration Management Office = Decision Management Office
- 50. 50 The decision drumbeat Basedon: Bain & Company Decide Input Recommend Agree Perform Provide input to recommendation – information/facts first, then judgement Formally approve recommendation – implies veto power Gather relevant facts and apply judgement to recommend a decision or action Make the final decision – “commit the organization to action” Be accountable for making a decision happen once made Recommend Agreed
- 51. 51 From PMI totransformation Business case: Healthcare company Control Organization Costs Growth Efficiency Labor Operations Effectiveness Development Staff Clinics Service Organization = our people Finance = our business Market = our clients Priorities Focus Education & competence Clinics layout, medical equipment, RS, etc. From All included portfolio → to Integrated care Effectiveness of clinical operations = medical quality Stage I – short-term Stage II – mid-term Stage III – long-term
- 52. 52 Different roles ofintegration project management X is … Training You could do X Consulting Try Y because… Mentoring I’ve done X X, Y, Z, … Coaching What else?
- 53. 53 Definition & meaningof roles Coaching Teaching Counselling Consulting Mentoring Therapy Training Passes on advice and knowledge of a person who has been there before; expert instructs and teaches the trainee Develops thinking and capabilities: the what & how of an action Assists and gives advice in resolving problems; looks at past to present where & what Provides answers and solutions, expertise in a given field on the best way to solve a problem Passes on advice of a person who has been there before; unequal relationship: more experienced person vs less experienced person Helps a person to improve his performance; observing; giving feedback; inspires new thinking. Action: looks at present to future: what & how will you go about it? Doesn’t provide answers nor solutions 1 Treats or relieves a disorder; action not emphasized; focus on fix what is broken 1 2 2 3 3 4 4 5 5 7 7 6 6 Roles
- 54. 54 Agile coaching competencyframework Based on: Agile Coaching Institute (2015) Technical Technical expertise typically delivered through Mentoring and Teaching Process-focused competencies Content-focused competencies Agile-lean practitioner Mastery Business Business value drivers expertise often paired with Teaching, Mentoring or Facilitating Transformational Organizational development expertize frequently paired with Coaching and Facilitating Coaching Guiding the creative ‘out-of-box’ process Facilitation Guiding to solutions and decision making Teaching Instructing in specific knowledge, skills and perspectives Mentoring Sharing knowledge, experience and visions Knowledge & Application Broad, relevant, practice-based ‘servant leadership’
- 55. 55 3 levels ofagile coaching expertise Develops leaders, focuses on culture, catalyzes change Facilitates practices and collaboration on one team or a handful of teams Individual Team Project Organization Operates at the multi-team level; develops teams, mentors others, advices managers Enterprise Coach Agile Coach Agile Team Facilitator
- 56. 56 Agile coach trinity Team coach Individual coach Management coach Agile Coach COACH Focuson teams to improve value flow to customer Build relationships Individual Listen, engage, and ask questions to draw out and overcome individual’s internal challenges Management Guide management in the allocation of resources to create environment for teams to grow based on the needs identified in teams retrospectives Team Guide retrospective conversation to facilitate the development of self-organizing and self- improving team
- 57. 57 Smart elements ofIntegration DISCIPLINE, DISCIPLINE, DISCIPLINE ● Develop a strategy and viewpoint on ‘HOW MUCH integrate’, ‘HOW MUCH centralize/decentralize, ‘HOW MUCH do yourself or outsource’, and ‘service scope’ ● KNOW what you’re doing and why you're doing ● Recognize the difference between the ‘quick fix’ and ‘long- term’ solutions ● COMMUNICATE everything; if you think you are communicating ‘too much’, you are probably not communicating enough ● Vision, Values and Culture ARE real and material systems, and cannot be ignored ● Take on the hardest decisions EARLY ● Manage key STAKEHOLDERS ● If someone is an ‘enemy’ of change, you should probably kill him – the SOONER, the better ● The higher degree of integration, the higher the economic PERFORMANE of the acquisition ● Get everyone speaking the SAME lingo ● Structuring the integration team correctly and staffing it appropriately are both essential to a successful integration ● Culture and practice of integration focused on avoiding failure can CONFLICT with realization the full value of M&A ● Best practices are based on past conditions ● Identify and focus on the CORRECT priorities ● Do not allow the integration effort to disrupt ongoing operations ● 100-day plan should not be focused as much on figuring out ‘what to do’, but more on ‘HOW’ to realize the acquisition objectives ● Lead roles should be staffed by people with in-depth industry and functional experience ● Appointing the RIGHT team to manage the integration is one of the most important factors in determining the success of the integration ● Deals with robust integration plans backed by explicit principles and policies deliver greater shareholder value ● The management of the HUMAN SIDE of change is the real key to maximizing the value of a deal ● If the assigned RESOURCES have other pressing responsibilities, execution of the integration plan will suffer due to inadequate attention ● Start integration process BEFORE closing ● Functional leaders without integration experience will bring delays, mistakes and additional resource drain ● How do we use integration to improve our OWN culture? ● PMO is a ‘glue’ of integration ● Improvisation has no place in the unforgiving business of change ● The primary purpose of integration team is to IMPLEMENT strategy, not develop or validate it ● Integrate with the END in MIND ● Disrupting a system by plunging it into complete chaos is rarely a recipe for success ● COMMUNICATION is a stabilizer ● Acquisitions are of PEOPLE, so the cultural piece is critical
- 58. 58 Every integration, evenevery day of integration is unique. Evaluate this experience and learn from it. If you do not evaluate – you do not learn, if you do not learn – you do mistakes, you repeat mistakes – you fail…
- 59.
Editor's Notes
- #21 Portfolios contain a collection of Programs that support business strategies. Executives need the ability to adjust their portfolio mix as market conditions and opportunities change. Portfolio needs to answer: ‘Levers’ for Executives to adjust portfolio mix Ability to adjust portfolio based on market conditions Line of sight visibility across enterprise value chain Programs focus on benefit streams that yield value and look for opportunities to increase value and deliver solutions. Program needs to answer: View of business value delivery over time by business value segment Alignment to strategic roadmaps Projects have a specific outcomes that they are required to performance against. Project needs to answer: Deliver as much business value as possible Deliver rapidly Provide visibility Agile practices are typically applied at the project level but have positive affects on Programs and Portfolios.
- #22 What is project: Outcome focused Follows a Lifecycle: Requirements-Design-Development-Test-Deploy Requires a coordinated team of participants Works towards a budget and schedule with an end date Manages Risks and Issues … What is program: A collection of projects with a similar outcomes Focus on providing a benefit stream for a business unit or product area Support a roadmap of value for a business unit or product area No specific end-date What is project portfolio: Portfolios look at the entire value chain of investments required for an organization Align investments to business strategies Executive level view of where to increase or scale back investments Portfolios reflect a mix of investment opportunities and are managed to increase business value and to hedge against risk
- #23 Project categories Predictive Projects for which all the required work can be defined upfront with a high degree of confidence that the work will remain stable throughout the project life cycle. Inventive Projects for which the required work cannot be defined upfront but must evolve over time and require a life cycle that accommodates that evolution. Agile Project Management Planning Continuously: Product, Project, Release, Iteration, Daily Tradeoffs – using feedback to adjust Prioritizing by Business Value: Associating value with requirements Estimating by Relative Value: Estimating size not duration Risk Management: Intrinsic to the lifecycle Addressed by entire team all the time