Many of you know our friend, colleague, and frequent workshop presenter, John Sinkus. With his 30+ year career as CIO, Enterprise Architect, and deep M&A subject expert on all things IT related, John has consulted with some of the world’s leading companies and has trained hundreds of executives and managers in the Art of IT M&A. I had a chance to discuss the upcoming M&A Leadership Council workshop, the Art of M&A Business and IT Alignment with John recently and wanted to share these highlights.
MH: What are the key objectives for this workshop?
JS: This workshop is all about building and executing effective IT strategies and operations for M&A. It starts with understanding the essential IT requirements, roles, responsibilities, and deliverables throughout each phase of the M&A lifecycle from best practices and top skills viewpoint. We balance the focus on both what business executives expect and need from IT (and often, what they don’t understand about IT M&A) as well as from the IT viewpoint - what we need and expect from business executives during M&A (and often don’t get). In sum, our objectives are to help corporate IT M&A leaders get it consistently right on every deal, both for their function, but more importantly, in the eyes and viewpoint of the business.
MH: Let’s pick up on what you said about IT leaders in M&A…what are some of the most common mistakes IT leaders make concerning supporting the business during M&A?
JS: In the workshop, we deal with that question from the standpoint of the business process, an ability to engage effectively with the business, creating an overall system of IT operational execution during M&A, and the core underlying technology. For now, just two quick examples. First, concerning expert knowledge of the business and underlying business processes. IT may often try to resource their M&A roles with a 3rd level resource who gets assigned to support a top function leader role, but who doesn’t have the requisite expertise in that function or business process. The experience gap is just too big of a mismatch, and the risk is that IT under-delivers on requirements. In my view, IT M&A success begins with the IT leader's understanding of the business and its respective IT needs.
Next, from the overall system and optimization viewpoint. We encourage IT M&A teams to take a holistic decision approach and will provide several decision frameworks to help them do this. For example, there’s so much pressure to execute on both the day-to-day operational IT portfolio – apart from an M&A – that IT may feel they have to try to get to an immediate resolution whatever the long-term downsides. That often results in additional costs, underperformance, and other risks, etc. If IT can look at all key decision inputs and alternatives together, a much better solution may be possible. However, it takes an overall systems approach and holistic decision process to do this on the run. You also need an IT team that can look at the implications from all aspects, including IT infrastructure; application infrastructure and integration; data architecture and governance; management processes and controls; IT organization, capabilities, and resourcing; and the overall project portfolio.
MH: Tell us a bit more about the agenda and what you and the team will be covering in the workshop
JS: The workshop starts with a section on how to align IT and business needs in M&A more effectively. From there, we provide a comprehensive overview of the requirements of the M&A lifecycle. This covers the who does what and when, throughout each deal phase. The needs and best practices for practical IT playbook are addressed. This includes artifacts: how to map to the enterprise M&A lifecycle at each phase and what the business, functions, and deal lead or integration lead are executing at each phase. With regard to effective IT M&A integration planning and decision making, we thoroughly discuss several different decision support tools including elements of the Gartner Group’s PACE-Layered Application Strategy (e.g., systems of record, systems of differentiation, and systems of innovation) and how that should be used during M&A; application optimization tools that help IT M&A teams effectively evaluate applications from the standpoint of cost-effectiveness and business value, then sort applications for integration action by whether to migrate, invest, retire or sustain each application; and an overall IT M&A blueprinting model that can help drive the overall planning design.
One of the new elements of this workshop we are very excited about is a deep dive into cybersecurity in M&A. Starting at due diligence, what do you look for, what are the critical risk areas and what are the deal implications, whether go/no-go based on pre-identified decision criteria and how to assess the costs/risks associated with integrating security tools, policies, and standards.
Another unique thing about this workshop is the fact that we keep referencing the business viewpoint throughout the content. We are addressing essentials for focusing on deal value and business risk management and reporting and analytics. We’ve also included a section on IT implications for divestitures, which we anticipate for 2020-21 we’ll be seeing quite a bit of sell-side divestments and buy-side carve-outs. Regardless of which side of a divestiture your IT M&A team is on, there’s so much complexity from the standpoint of separating highly integrated shared services and executing through a transition services agreement that we felt it was essential to include this.
The final aspect of the workshop is the individual IT M&A team member skill-building. We’ll be looking at the things that often frustrate and challenge IT M&A teams most – people and organizational factors, change management, communications, and culture alignment with buyer/seller IT organizations; M&A governance and operational execution. We’ll do that through extensive networking, case studies, exercises, and lots of war stories from all participants to help us capture essential lessons learned and lots of practical applications.
MH: Whom would you recommend attending this workshop?
JS: This workshop targets IT M&A leaders in corporate acquirers. If you are the head of IT M&A and IT M&A program manager, or if you lead one or more sub-functions in IT, this would be ideal. We’ve also had lots of enterprise IMO leaders, or enterprise PMO leads attend over the year to more effectively build their IT-centric understanding and skills. Some organizations send several IT team members to the same workshop together so they can work offline on crucial challenges and opportunity areas and come back ready to apply what they’ve learned consistently.
John S. Sinkus s the President of DivIHN Solutions, a division of DivIHN Integration Inc., and serves as Senior Advisor to M&A Partners. He leverages his more than 30 years of business systems integration, enterprise architecture, business analytics, business and project thought leadership and CIO experience to successfully advise clients regarding their M&A business and technology strategies, designs and transactional integrations. An accomplished practitioner in the M&A, finance, human resource, and management consulting industries, John has successfully orchestrated several large-scale, global projects with responsibility for budgets ranging over $250 Million and project teams spanning several countries. John advises and works with clients throughout all phases of the Mergers & Acquisition lifecycle, from Strategy and Readiness through Due Diligence, Stabilization and Optimization.