M&A Information Technology Best Practices

Chapter 3

Aligning Business and IT Strategy during Mergers, Acquisitions, and Divestitures

Jason AsperWes Protsman

The previous chapter highlights the essential role of information technology (IT) in mergers and acquisitions (M&A) and discusses its important role in delivering against the deal objectives.

Often, this role can be overwhelming to both IT executives and business leaders, due to the complexity of the IT environment, as well as the timeline and cost commitments involved in execution. The IT complexity spans business applications and data management as well as infrastructure elements such as data centers, telephony, networks, security, and end-user support.

Acquisitions are completed for many reasons (see Exhibit 2.2 in the previous chapter), but in most cases, the driver can broadly be described with the objective to capture incremental business value. This business value, defined most often as synergies, is frequently dependent on IT.

Given the role of IT as a key enabler to this business value creation, as well as a source of value in itself, IT has three key objectives in M&A:

1. Enabling the business synergies and value creation.

2. Effectively integrating IT and driving IT synergies.

3. Stabilizing the IT function as it adapts to significant change.

Often, IT's first and most important function is to enable the business synergies critical to the deal. This key objective must parallel with IT function-specific synergy capture and integration, as well as IT stabilization ...