Mergers and Acquisitions have become an inherent part of the global enterprise strategies and looking at the pace of acquisitions, mergers and de-mergers that are happening these days, it is important that organizations come up with detailed frameworks and leverage them to speedily complete the process of acquiring, merging or separation of entities. This will not only reduce the cost of activity but will also make sue that we cover all aspects during the process with no surprises left for later stages. ERP has a large role to play in these mega activities as it is seen that lot of issues can be reduced if ERP can be leveraged correctly. Obviously ERP’s role will be governed by the consistency, accuracy and completeness of data as the data in it will be a core factor to take multiple decisions in the process.
The benchmarks for divesting a company or merging with a newly acquired company have climbed in last couple of years to 6 - 8 weeks. Along-with this, internal re-organization exercises like creation of new regional business, moving production from one plant to another or compliance related changes also are eligible to be part of M&A activities in terms of their similarity of sub activities. These also have quite stringent benchmarks these days and are possible to achieve only with the help of ERP.
To execute the above talked business objectives, a comprehensive global data strategy is critical and must be part of the overall enterprise strategy. The scope of the data strategy must be coordinated and owned by a data management team that operates as a business cross-functional team. To ensure business sustainability and growth, the ERP system needs to be able to support data process changes in a focused, fast, and flexible manner (the front end) and must include the swift re-alignment of data and data hierarchies to reflect internally or externally driven changes to the business context. Also the introduction and scale of shared services will need to be enabled and even accelerated to provide a slim, cost-efficient, and service-driven back end. Business modernization, operational efficiency, and successful mergers and acquisitions all rely on accessible, timely, high quality data.
ERP can help you to define, measure and monitor the integration of new businesses with parent business and it is important that you come out with a framework which leverage your ERP, your ETL tool and the business logic for smooth integration of data integration. One of the popular frameworks is as below:
To measure the success of mergers and acquisitions transactions, it is imperative to set up clear criteria related to the data dimension. Otherwise, the business case will be incomplete. The cultural change is critical for any merger or acquisition. A tremendous effort will be required in this area to ensure a successful change management. Therefore, introducing and executing a proven data excellence framework supported by a robust platform is a mandatory accelerator to deliver an efficient data integration and to support a business driven data governance while the organization focuses on the cultural challenge. 53PSVV3Q4S2M