10 Concepts We Can Learn About Integration After Acquisition on How2Exit's Interview W/ Tony Benedict Partner with Omicron Partners: Watch Here E113
Here is what my team and I learned from this interview: (These are notes from team members, writers, sometimes AI, and even listeners who submitted what i learned loosely edited and shared here) - If it seems a bit unrefined, you're reading our notes, so. yeah. -Ron
Concept 1: Integrate Quickly And Correctly
Integrating a business quickly and correctly is essential to ensure its success. In the world of mergers and acquisitions, it is important to have a clear plan of action for integrating a business and to be able to execute it in a timely manner. This is why Tony Benedict, the CEO advisor, is such an expert in the field.
Tony's origin story began with working for Intel, a global company that outsources a lot of its assembly and test processes. This experience taught him a lot about in-sourcing and out-sourcing manufacturing, as well as how to standardize processes which can be difficult for some companies. Intel coined the term "copy exactly" which means that no matter where a factory is located, the same processes are used. This standardization is a key component to the success of a business.
Tony then moved into the healthcare industry, where he worked for a for-profit healthcare system that was backed by private equity. This experience was unique because of the additional pressure of being for-profit, and the need to be efficient and effective in the acquisition process. In this role, Tony was able to grow the company from 12 to 28 hospitals in 18 months, and from 2 something billion to almost 7 billion in revenue. This was largely due to the integration efforts that Tony was able to lead.
Tony's experience in the healthcare industry has made him an expert in the field of mergers and acquisitions. He is well-versed in the post-acquisition integration process and the importance of integrating quickly and correctly. He has seen first-hand how long it can take to integrate a business if it is not done correctly, as well as the benefits of doing it quickly and correctly.
Integrating a business quickly and correctly is essential to ensure its success. Tony Benedict is a great example of an expert in the field of mergers and acquisitions and his experience has taught him the importance of integrating quickly and correctly. By following his advice, businesses can be sure that their integration will be successful.
Concept 2: Train Internal Resources
One of Benedict's key strategies for integration is to train internal resources. Rather than hiring outside contractors, he prefers to use the resources of the client company and teach them the skills they need. This is a great way to reduce costs and make sure that the integration is successful. It also helps to create a sense of loyalty among the employees, as they are being given the opportunity to learn and grow. In addition, it allows the company to build a team of experienced professionals who can help with future acquisitions.
Benedict also believes in using a process-based approach for transformation with technology as augmentation. This helps to speed up the integration process and ensure that it is done correctly. Additionally, he focuses on preventing attrition, as this can be a major issue when integrating a business. By communicating to employees that they are valued, Benedict is able to assuage their fears and keep them from leaving.
In conclusion, training internal resources is an important part of any successful integration. By following the advice of experts like Tony Benedict, businesses can be sure that their integration will be successful. By training internal resources, businesses can reduce costs, build a team of experienced professionals, and prevent attrition.
Concept 3: Culture is Key to Success
Culture is key to success. When businesses merge, it is important to ensure that their cultures are compatible. If two companies have incompatible cultures, it can lead to failure. To prevent this, businesses must take the time to understand the cultures of both companies before proceeding with the merger. This can be done by asking the right questions, such as what type of acquisition is it, how many locations do you have, and what is the level of cost reduction you're trying to achieve and why. Additionally, businesses must be aware of the potential for both cultures to evolve during the integration process.
Businesses must also consider the technology side of the integration. Technology plays a crucial role in the success of any integration. It is important to ensure that the technology systems of both companies are compatible and can be easily integrated. This includes ensuring that the systems are secure and that data can be easily transferred between the two companies.
Finally, businesses must consider process integration. This includes standardizing processes, integrating technologies, and ensuring that the market is compatible with the new company. It is important to remember that every acquisition is different, and businesses must be flexible enough to adapt their playbooks to the needs of the situation.
Culture is key to success when it comes to integrations. By understanding the cultures of both companies and taking the time to integrate their technologies and processes, businesses can be sure that their integration will be successful.
Concept 4: Focus on Operational Integration
When it comes to integrating two companies, it is important to focus on operational integration. Operational integration is the process of combining the operations of two companies into one. This includes merging technologies, processes, and cultures. It is important to understand the cultures of both companies in order to ensure a successful integration.
For example, when Lockheed Martin acquired a smaller company, the engineers of the smaller company had to adapt to the culture of the larger company. This included wearing more formal attire, such as button-up shirts and sports coats, as VIPs may be walking through the building at any time.
It is also important to focus on the goals and objectives of the company when integrating two companies. By understanding the goals and objectives of the company, it is easier to keep everyone focused on the task at hand. The last thing that should be worrying about is whether people are wearing the right clothes to work. Instead, it should be focused on whether they are getting the job done.
In conclusion, when integrating two companies, it is important to focus on operational integration. This includes understanding the cultures of both companies, merging technologies and processes, and keeping everyone focused on the goals and objectives of the company. By doing this, businesses can ensure that their integration will be successful.
Concept 5: People are Everything
However, one of the most important aspects of integration is understanding the people involved. People are the most important part of any business. They are the ones who make the decisions, who execute on those decisions, and who can make or break a business. As such, it is important to understand the culture of each company, and how the people within each company interact and work together.
The podcast discussed the importance of understanding people and culture when integrating companies. It highlighted the importance of understanding the goals and objectives of the company, and how the people within the company can affect the success of the integration. It also discussed how small companies have a more family-like environment, while larger companies may have different cultures in different locations.
The podcast also discussed how important it is to have a harmonious leadership and management culture. This is so that everyone is marching in the same direction, and that the company can be successful. It also discussed the importance of understanding people and culture, and how it can help or hinder a business.
Ultimately, people are everything when it comes to integrating companies. It is important to understand the cultures of both companies, the goals and objectives of the company, and how the people within the company interact and work together. By understanding people and culture, businesses can ensure that their integration will be successful.
Concept 6: Communication Is Key
One of the most important aspects of integrating companies is communication. Communication is key in any integration process and should be part of the due diligence process. This includes understanding the customer experience, the processes that support it, and the legal aspects of the integration. It is important to understand the different ways that customers are serviced and how they can be unified. Additionally, it is important to understand the different processes that are in place and how they can be standardized.
Communication is also important in order to ensure that all parties involved in the integration have their expectations met. It is essential that all parties understand what is expected of them and what the outcomes of the integration will be. Without proper communication, there can be unmet expectations, which can lead to failure.
In conclusion, communication is key in any integration process. It is important to understand the customer experience, the processes that support it, and the legal aspects of the integration. Additionally, communication is essential in order to ensure that all parties involved in the integration have their expectations met. Without proper communication, there can be unmet expectations, which can lead to failure. Therefore, communication is key to ensuring a successful integration.
Concept 7: Leadership Drives Culture
Leadership plays an integral role in the success of any integration. Leadership drives culture and sets the tone for the organization. Leadership must ensure that all employees are aware of the organization's values and goals. They must also ensure that the organization's agenda is communicated to the employees on a regular basis. Communication is essential in order to ensure that everyone is on the same page and working towards a common goal.
Leadership must also provide clear expectations to their employees. This includes setting deadlines, assigning roles and responsibilities, and providing feedback. Without clear expectations, employees can become confused and frustrated. This can lead to a lack of motivation, which can result in a lack of productivity and ultimately, failure.
Leadership must also be aware of any hidden agendas that may exist among their employees. This can be a result of ego, where employees may be trying to push their own agenda. It is important for leadership to be aware of this and to actively communicate the organization's agenda to all employees. This will ensure that everyone is on the same page and working towards the same goals.
In summary, leadership drives culture and is essential for a successful integration. Leadership must ensure that all employees are aware of the organization's values and goals. They must also provide clear expectations and communicate the organization's agenda. Additionally, leadership must be aware of any hidden agendas that may exist among their employees. Without proper leadership, integration can fail. Therefore, leadership is key to ensure a successful integration.
Concept 8: Measure Decisions Against Values
One key component to successful integration is measuring decisions against values. Values are the core beliefs of an organization, and they should be reflected in all decisions. When making decisions, it is important to consider how they align with the organization's values. This helps ensure that the organization is on track to achieve its goals. It also helps to maintain the integrity of the organization's mission and vision.
When making decisions, it is important to consider how they align with the organization's values. This means that the decision-makers must be aware of the organization's core values and use them to make informed decisions. The decision-makers must also consider the potential long-term effects of their decisions and how they will affect the organization's values. Additionally, they must consider how their decisions will affect the organization's employees.
Measuring decisions against values is an important part of post-acquisition integration. During the process, it is important to measure employee retention. This is a leading indicator that can help identify potential issues before they become a problem. Additionally, it is important to communicate the organization's agenda to employees and provide clear expectations. This helps to ensure that employees are aware of the organization's values and goals and can make informed decisions.
In conclusion, measuring decisions against values is an essential part of successful integration. It helps to ensure that the organization is on track to achieve its goals and maintain its integrity. Additionally, it helps to identify potential issues before they become a problem. Leadership must be aware of the organization's values and goals and communicate them to employees. This helps to ensure that employees are aware of the organization's values and can make informed decisions. By measuring decisions against values, organizations can ensure a successful post-acquisition integration.
Concept 9: Best Employees Already Employed
When it comes to hiring, it is often said that the best employees are already employed. This is especially true in the tech industry, where there is a high demand for certain types of programming languages and people can jump around as much as they want. It is often difficult to find good tech employees, and companies have been known to give hiring bonuses of up to $25,000 in order to attract them. Additionally, when a startup is struggling with funding and is about to be acquired, companies will swoop in to try and hire their lead engineers, knowing that they are about to go through a major change.
High performers are often the first to leave in an acquisition, as they may be looking for something new and exciting or have been thinking about leaving for a while. It is important to identify these people early, as they can be great candidates for a new job in the company. It is also important to be proactive when it comes to employee retention, as people are naturally resistant to change. By describing the new roles and responsibilities to employees, they will be more likely to stay and take on new responsibilities.
Ultimately, the best employees are already employed. Companies should be aware of this and be proactive in their approach to employee retention. By using the resources of the client company, communicating roles and responsibilities, and identifying high performers early, companies can ensure a successful post-acquisition integration.
Concept 10: People First, Process Last
The first step in successful post-acquisition integration is to use the resources of the client company. This means understanding the culture and values of the client company, as well as the skillsets of the current employees. By doing this, companies can ensure that the right people are in the right positions to make the most of the acquisition. Additionally, companies should identify high performers early and make sure they are given the opportunity to advance within the organization.
The second step is to communicate roles and responsibilities clearly. Companies should be upfront about what is expected of employees, and how their roles will be impacted by the acquisition. This will help ensure that employees understand the new company’s goals and objectives, and how they can contribute to the success of the acquisition.
Finally, companies should be aware of the different mindsets of employees. Some employees are builders, while others are sustainers. Builders are natural problem solvers and need something to keep them engaged. Sustainers, on the other hand, are content to stay in the same role and do the same thing day in and day out. Companies should be aware of this difference and make sure to provide the right environment for both types of employees.
In conclusion, companies should always put people first when it comes to post-acquisition integration. By using the resources of the client company, communicating roles and responsibilities, and identifying high performers early, companies can ensure a successful post-acquisition integration. Companies should also be aware of the different mindsets of employees and make sure to provide the right environment for both types of employees. By taking these steps, companies can ensure that the acquisition is successful and that employees are retained.
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