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Mergers and Acquisitions

Overcoming Post Merger Integration Challenges

The accelerated adoption of SaaS and cloud companies has contributed to an increase in the number of mergers and acquisitions of technology applications and services (such as Oracle purchasing Taleo, IBM purchasing Kenexa, Salesforce acquiring ExactTarget). These M&As, whether they be of SaaS, cloud, or on-premises technologies, aid businesses in numerous ways - diversifying their portfolio, increasing focus on core competencies, establishing new growth platforms, adding a new set of capabilities, and much more.

Selecting the right company to extend your portfolio is the first step. Due diligence can help with the evaluation process and prepare businesses to address existing issues surrounding finance, compatibility, management, and legal areas. The next challenge deals with the difficulties that arise post-merger when trying to integrate people, systems, and business processes in order to maintain efficiency. Overcoming cultural challenges can be difficult and without the right balance, performance, collaboration, and productivity may suffer. Challenges surrounding integration of systems and business processes arise and overcoming them can be quite difficult if not done right.

 

Post Merger Challenges

Businesses must overcome many technology challenges after an acquisition in order to unify and streamline business processes across the entire enterprise. It is rare, if not impossible to find two companies using identical systems and applications, especially when they can employ up to as many as ten to fifteen applications to run separate business processes. This distributed structure makes it crucial for businesses to quickly integrate systems, applications, and databases in order to get business processes up and running in synchronization.

Principal technical challenges that organizations face following M&As include:

  • Insufficient IT integration: A lack of synchronization throughout the IT infrastructure can cause difficulties with everyday business processes (e.g. onboarding new employees, sales and marketing lead management, quote to cash) creating complications and slowing down time overall operations. Moreover, without integration of supporting and operational process applications (e.g. HR, finance, CRM, ERP, sales, marketing) within the entire enterprise, mistakes and replications are inevitable. This complicates matters and distracts companies from focusing on their core business competencies, such as delivering insurance, retail, media and other countless products and services. As both the acquired and the acquiring company come in with separate financial systems, suppliers, partners, etc., it is vital to ensure a standard is established.
  • Lack of visibility: With two merging companies in a similar technology landscape it is possible to have duplicate customer information. Additionally, unless the two merged companies have established a customer data integration system, the challenge of obtaining an updated single view of the customer is imminent. For instance, having two disparate Salesforce.com organizations can result in two sales representatives contacting a single customer, painting a disjointed picture of the company.
  • Data integration: Data integration ensures businesses have access to updated information across the entire enterprise regardless of whether it resides on-premises or in the cloud. Without an effective data integration solution, retrieval of information scattered across numerous systems, applications, and services is complicated.
  • Compliance Regulation: Compliance issues are likely as two converging businesses do not have the same levels of compliance. Policies, contracts, and guidelines are crucial and consistent enforcement, visibility, and control is necessary to permit businesses run smoothly. Moreover, if the acquiring company is global, the possibility of training and education around new compliance policies may be necessary.

Point-to-Point Integration - Inadequate for M&As

Following mergers and acquisitions, many organizations start integrating their systems with custom code. Custom code requires experienced developers to create custom point-to-point integrations between specific applications, services, systems, and databases. This approach, although feasible for small companies with only a couple of endpoints, is impractical for businesses with ten or more applications to integrate, and especially so for two merging companies. Very quickly, custom code becomes “spaghetti code” - complex, fragile, and difficult to manage, vulnerable to breakage at the slightest modifications. Although point-to-point integration solves a short-term problem, it complicates matters when integrating two companies.

Simplifying Integration with MuleSoft Anypoint Platform

MuleSoft offers a next-generation for enterprises to connect and transform businesses after mergers and acquisitions. Anypoint™ Platform creates connectivity across the business ecosystem. With CloudHub, MuleSoft’s cloud integration platform as a service (iPaaS), merging companies can easily connect cloud-based and on-premises applications with ease. CloudHub supports various use cases, including:

  • Cloud to cloud integration: CloudHub makes it easy to connect SaaS applications. If your business and the business acquired are both SaaS-based, cloud integration use cases such as process orchestration and data loading are effortless.  
  • Cloud to enterprise integration: Inheriting on-premises applications and databases is common after mergers and acquisitions, making it important to integrate and secure connectivity across the cloud and on-premises through a single platform.
  • API enablement: M&As make way for new, innovative technology. With a thoughtful API strategy, businesses can make their services available over REST APIs to support web portals, mobile devices, tablets, and partners.
  • Social enablement: Stay connected with existing and newly acquired customers or allow for seamless collaboration among new and existing employees with social enablement. Moreover, social enablement allows the right information to be shared with the right people when they need it most - across departments and teams.
  • Integration for SaaS providers: For those who have recently acquired a SaaS company, the concern around how existing customers will use both existing and new applications together is important. Integration apps and out-of-the-box connectors provide integration solutions for customers in order to support joint system usage.

MuleSoft also provides other components to help businesses with their integration needs. MuleSoft's Anypoint Platform is the market-leading unified integration platform. Anypoint Platform is trusted by over 1,600 enterprise customers in 60 countries. There are numerous products within Anypoint Platform that create connectivity, including:

  • Anypoint Studio: Design on a single drag and drop interface environment to write once and deploy anywhere
  • Anypoint Connectors: Create instant API connectivity to hundreds of popular services and applications on-premises or in the cloud with out-of-the-box connectors.
  • DataWeave: Integrate data post-merger with the easy-to-use graphical interface of DataWeave. For businesses interested in Salesforce specific data integration, Dataloader.io is an integration app that allows users to import, export, and delete unlimited amounts of data in Salesforce.com for free.
  • Mule Enterprise Management: Obtain real-time visibility and utilize essential management tools for ESB resources.
  • CloudHub Insight: Manage integration apps with transparency and granular control for optimal results.
  • Anypoint Service Registry (now part of API Manager): Manage internal and external services and applications with visibility, flexibility, and ease. Anypoint Service Registry makes it easy to manage, catalogue, and discover services throughout their lifecycle.

MuleSoft offers a library of solutions for numerous use cases related to enterprise data integration. Whether it be overcoming integration challenges after mergers and acquisitions or building a connected hybrid environment, MuleSoft provides a complete set of products to keep businesses connected.

Learn more about Anypoint Platform and its entire lineup of products by contacting us today.