Mergers and acquisitions: An excellent time to change and improve your organization
Mergers and acquisitions (M&As) and corporate restructuring are normal. Deals can be worth hundreds of millions, or even billions, of dollars. Not surprisingly, we hear about M&As almost daily in the news headlines. Next time you flip open the newspaper's business section, the odds are high that at least one headline will announce some kind of M&A transaction.
The upheaval caused by integrating with another organization significantly challenges the way both organizations conduct business. According to IBM research, an astonishing 77 percent of organizations do not recover the costs associated with M&As. Moving forward in an uncertain environment is challenging but a business disruption is an excellent time to look at ways to optimize across the enterprise.
Change is a strategic point in the business cycle to take advantage of marketplace opportunities. Building a simplified and streamlined agile enterprise which balances growth, efficiency, and resiliency requires changes in business processes and IT applications. To achieve this, enterprises need to have ultimate visibility into their business processes and enterprise architecture, including data, applications and infrastructure. They need to understand how processes are linked. What is the effect of a shutdown or backlog in one area to the rest of the processes? What are the overall implications on the quality of service to every part of the process? It is important to ensure that service availability and performance are not just acceptable but actually improving to keep and grow the enterprise's customer base.
From an IT operations perspective, enterprises first need to understand what their systems, applications and processes look like before they can optimize their current infrastructure and integrate new processes and systems. Without true visibility into their processes, enterprises may take the short-term, conservative and less-risky approach of maintaining systems with overlapping or redundant capabilities - which can lead to costly inefficiencies. Over the long term, not only does this burden the organization with additional costs and rigidity, but it also increases the operational risk of maintaining niche systems. From a high-level view, IT integration includes looking into the capabilities and business processes supported by IT in order to understand the dependencies of the various business applications.
Since the credit crunch, many financial services institutions have been subject to major business changes brought on by M&As. In this white paper - Managing mergers, acquisitions and divestitures in financial services institutions: Leverage change to drive a streamlined agile enterprise to balance growth, efficiency and resiliency - learn more about how you can successfully manage a major business change.