M&A Integration Playbook

DD CONSULTING’s ROUND TABLE ON M&A INTEGRATION PLAYBOOKS (or Methodologies)

Here at DD Consulting we are often asked about M&A Integration Playbooks and have found during our many discussions with clients and business associates that there is much confusion over what an M&A Integration Playbook is, how it should be developed, and how it should be deployed.

So what is an M&A Integration Playbook?

Quite simply it is a project management tool that enables corporate acquirers to plan and deliver a post deal integration. Think of it as a “toolbox” from which elements can be selected to which are relevant to the particular strategy and issues relating to the deal.
No two integration plans are the same as the risks and issues are different in every acquisition scenario, but using a playbook tool will enable acquirers to develop a focused and relevant set of actions plans.
M&A Integration Playbook tools continually evolve as new issues and required actions become apparent in different deals – effectively it should capture learnings from each deal and adapt to make them available for future integration plans.
There is no set format to M&A Integration Playbook tools, but they should contain the knowledge that will be needed to plan and deliver an effective integration. At DD Consulting we have seen everything from 20 page glossy brochures for the top 100 executives through to a granular action by action set of plans which can just be picked up and used by all members of the integration team.

At DD Consulting our M&A Integration Playbook:

  • All the functional workstreams needed to both plan and project manage the integration
  • All the steps and stages needed in the workstream plans, with back up tools, checklists, and knowledge slides

Why do you need an M&A Integration Playbook?

If you were planning a project, would you start with a blank piece of paper and some people who have never planned or run a project before? The simple answer is no. So why would you buy a company with a blank piece of paper? The M&A Integration Playbook provides: a strategic overview driving the deal, a detailed how to/what to do guide for the integration team and enables you to sense check the deal before commitment or diligence.
Any corporate acquisition should be based on sound strategic principles with specific benefits/goals (for example cost or revenue synergies) being identified. In order for a deal to be successful, it is therefore critical that these benefits/goals are realised through a targeted and effective integration plan. Using a M&A Integration Playbook provides the structure to ensure that appropriate actions are delivered to realise these benefits/goals – in effect it keeps the integration team focused on realising the value drivers behind a deal.  In addition an M&A Integration Playbook also acts as a basic checklist of micro actions that are often overlooked and may be critical on Day 1 – for example changing control over bank accounts.
Ensuring that everyone involved in the integration fully understands what they are doing and how it fits into the bigger picture is key to ensuring success – your M&A Integration Playbook will provide a structure that allows for clear and effective communication with all the integration stakeholders. The creation of a repeatable methodology or playbook will enable you to deliver a far more successful integration than if you create a series of disconnected and unplanned activities. Further no two deal scenarios will be the same – each tailored playbook will be unique which can only be delivered from a comprehensive and flexible tool.

An M&A Integration Playbook delivers:

  • Rigorous systematic framework to deliver an integration time after time
  • Consistency
  • Governance
  • Prioritisation of resources to actions that deliver the highest value
  • Accountability/Ownership
  • Communication
  • Ability to develop from new learnings

 

Does every company making an acquisition need to develop its own M&A Integration Playbook?

Quite simply – NO.
If you are making very small one off type acquisitions there might not be any need to create your own M&A Integration Playbook. In these circumstances it may be possible to manage the integration through the involvement of an experienced consultant or coach. These individuals provide both the knowledge and resource to do the work.

Where deal activity does require the use of a M&A Integration Playbook, and you don’t have an in house tool, then here at DD Consulting we have a comprehensive tool which can be ap-plied to all deal scenarios. Through our experienced associates DD Consulting utilises the tool to design and tailor a comprehensive integration plan including detailed actions for each workstream which aims to deliver your strategic goals for the deal.
Plan

How will the M&A Integration Playbook help you?

The playbook will address the stages involved in an integration exercise:

  • What do we need to do?
  • The tool will help guide you through questions such as Where do we start? What happens next?What deadlines are we working to?
  • Who is involved?
  • Who is in the formal leadership team and who has responsibility for what?
  • What resources are required and for how long?
  • How is information shared?
  • What happens when we come across new scenarios outside of the tool?

 

Through this structured approach you will:

  • Speed up the integration planning and delivery enabling synergies to be planned and de-livered faster potentially yielding a material impact on profit.
  • Enable rapid strategic thinking. With the high level guidelines in place, planning can get going in business and functional areas much faster.
  • Focus on the money. Understanding the synergies and large ticket items, enables us to get through the chatter and immense about of work and change to deliver the right things fast.
  • Plan for Day 1. There is a critical starting point where work kicks off, the target sees us for the first time, a Day 1 plan at the very minimum needs to be in place.
  • Communicate effectively. Needs to be in place and running rapidly
  • Create accountability. Leadership and accountability needs to be put in place rapidly for both the integration and the business. Authority checked and changed. Delivery commenced.
  • Be ready. Ensure you’re ready for integration, preparation around resource, plan and culture are key.
    Stakeholder

 

How do you manage an M&A Integration Playbook?

Most companies hold the playbook centrally. The people responsible for the integration can then use the parts of it which are useful for that particular deal and then feedback knowledge, experience, and learnings from that deal. This ensures acquirer becomes better and better at deals as time goes on. This creates a learning loop, where the centre gathers the training, knowledge, capability and ensures it is made available to the wider organisation.

 

When should I have the M&A Integration Playbook ready?

As a minimum you should start building your integration plan, as you go through the deal process, however those companies who manage integration best will start in advance of doing the deal.
Considering the key issues and risks, understanding resource gaps, planning an effective roll out, delivering appropriate training, collation of required knowledge, etc in advance will in-crease the speed and effectiveness of the integration project. Clear assessment of organisational readiness for integration from both a cultural and resources perspective will prove invaluable.