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Tuesday, May 12, 2009

PMI - Key Areas of Integration

5:30 PM Posted by Deepak Nayal , No comments

Post Merger Integration (PMI) is a huge field in itself with loads written and talked about. I have been exploring this area for some time now and looking in retrospect my experience with organizations undergoing M&A. Based on my mini research, in order to articulate my thoughts I came up with a model of my own (such an MBA cliché). I believe that there are three key top level areas of integration in PMI stage for any M&A deal –

Here Systems & Processes and Culture take care of the hard and soft aspects of the integration respectively. The last, Management, is a hygiene factor – an infrastructural aspect if you may. So if the management integration is not done well, the effects will show up in the integration of other two areas too. I believe that in any PMI initiative management integration should be given the top priority. This is not saying that one should focus all energy in doing this while forgetting the other two aspects.

Here when I say management I do not just mean the senior executive management. This includes the middle and front line managers as well, and why not; After all, it is these people who are actually looking into the operational part of the post merger organization and it is these people who interact with the employees. So if this layer of the organization in frustrated or unclear about the tasks then the effect is going to permeate throughout the organization. I think if companies put more effort in the management integration, identify leadership and assign clear roles and responsibilities upfront then the whole process of post merger integration can be made smoother. 

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