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MergerandAcquisitionPost-TransactionIntegrationServices

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BestPracticesForPost—TransactionIntegration

Preparation

• Definesuccess• Developandadheretoanintegrationframework

• Don’tmakeDay1biggerthanitneedstobe

• Developatime-based,goal-centricintegrationplan

• Ifandwhenanorganizationalalignmentoccurs,communicateandsticktoit

• Identifyyourkeyplayers• Planandprovisionforculturalresistance• DeveloprealisticinternalITtimelineandbudget,butholdpartnersaccountablefortheirtimelineandbudget

• Geteveryonespeakingthesamelanguage

Execution

• Integrationisafull-timejobrequiringadedicatedprojectmanager

• Inspiteofpreparation,thingswillgowrong...it’showyoureactthatmatters

•Over-communicate,andthencommunicatesomemore

•Measuresuccessagainstprojectmilestonesandsynergygoal

Improvement

• Transitionfull-timeintegrationprojectmanagementtovariousowners

• Don’tlosesightoflongertermintegrationmilestones

• Continuetomeasuresuccessthroughmanagementdashboards/reports

BeginsPrior toAcquisitionClose 30-100Days 180+Days

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DevelopYour100DayPlan•UnderstandBuyerandAcquisitionandDealSynergies•DefineSuccess•ConfirmLeadershipCommitment

AlignStrategy

•AssessCulturalDifferences• Identify“Keeps”and“Gives”forBothOrganizationsIdentify Culture

•CreateA+TeamstoLeadIntegrationInitiatives•AgreeRoles&Responsibilities;TietoStrategy•MeasureTeamPerformanceandTaskCompletion

DedicateResources

•DefineandPrioritizeInitiatives•DevelopDetailedActionPlansforAchievingSynergies

DevelopActionPlans

•DefineDesiredEndState• SetMetricsandMonitorTeamProgress•TransitiontoOperations

Execute

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AligningStrategy

Define Short,MidandLong-Term

Success

• People- Integration,Training,Hiring,Exits,Comp,Performance Goals,MeasurementandReview• Process- Normalization/Standardization,Documentation,TrainingandReporting(Admin,Operations,Marketing,Sales,ServiceDelivery)

• Product,ServiceandSolution– SalesGrowthTargets• CostSavingSynergies– HardandSoftSavings(ProfessionalFees,Insurance,Procurement, etc.)

DevelopIntegrationFramework

•People•Processes•Systems•Portfolio•Customers•Suppliers

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Don’tMakeDay1BiggerThanItNeedsToBe

FocusArea Acquisition Buyer

ReportingStructure NoChange NoChange

Employees Nochange;keepcurrentbenefitplanthrough (TBD)

NoChange

BaseRevenue CreditedtoAcquisition CreditedtoBuyer

JointSynergyBuyer Single revenuegoalbasedoncross-selling;50/50splitbetweenAcquisition andBuyer

Single revenuegoalbasedoncross-selling;50/50splitbetweenAcquisition andBuyer

CommissionStructure AtAcquisition’s Discretion AtBuyer’sDiscretion

Customers Current;determineanyoverlapandstrategy toaddressit

Current;determineanyoverlapandstrategy toaddressit

Branding CurrentBrandingwithInputfromAcquisition andBuyer

NoChange

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DevelopaTime-Based,Goal-CentricIntegrationPlanDay1 Day30 Day90 Day180

Operations • Customerand Supplier OverlapAnalysis

• Technical, OperationalandAdministrativeResourceOverlapAnalysis

• SynergyIdentification

• OverlappingCustomerCoverage

• SalesForceTraining• ContractPrioritization• ContractRoadmap• SalesPlanDevelopment

• SingleCommissionStructure

Accounting • Acquisition HardClose• Create‘NewCo’• CheckSigningAuthority/Printing• Vendor Comparison &Upload• Acquisition Budget

• PurchasePriceAllocation• EquityCalculations&Entry• InterimMonth-end Close• Reviewof SupplierSpend

Reports

• Accounting SystemMigration • BankAccountConsolidation• CorpCC/Travel&Expense

Migration

IT • MembershipScrub• MemberListDistribution

• IT&SecurityAssessment • LOBandSalesCRMMigration• PSAandRMMTool Migration

• Laptops,Desktops, Infrastructure

HR • I-9Verification • EmployeeBadge-over, Onboarding• Acquisition Compensation Adj.• 401KOwnershipTransfer• Acquisition BenefitsEnrollment• PayrollMigration

Communications • PressRelease• InternalBuyerComms• Acquisition SupplierComms• BuyerCustomerComms

• Acquisition WelcomeMeeting

• Quarterly/Annual Kickoff • Branding

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Between30-100Days

FocusArea Acquisition Buyer

OrganizationStructure Consolidated

Employees Consolidatedback-office;singlebenefitsplan;PotentiallySeparateSalesteamsbasedonspecialization

Revenue Sales PlanasDetermined Sales PlanasDetermined

CommissionStructure AtAcquisition’s Discretion AtBuyer’sDiscretion

Customers As determinedbygrowthstrategyandSalesPlan

As determinedbygrowthstrategyandSalesPlan

Branding TBD TBD

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ThePeoplePartistheMostChallenging

• Whenorganizationalalignmentoccurs,communicateandsticktoit• MayormaynotbeonDay1• Avoidundefinedfuturestateorgchartsortransitionalorgcharts

• UseDISCBehavioralProfiling,RoleSurveysandLeadershipSelf-Assessments• UnderstandhowbesttocommunicateandconnectwithAcquisitionresources• Understandwheretheyseethemselvesintheorganization– leader,followerorneither• Identifydissatisfactionearlyanddevelopandimplementstrategiestodealwithit

• Identifyyourkeyplayers• Employeestendtoaskquestionof“whatdoesthismeanforme?”• Clearlydefine“thisiswhereweareandthisiswherewearegoing.”• Helpstoavoidunnecessaryattrition

• Planandprovisionforculturalresistance• Longestelementofoverallchange• Pickyourbattles

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AccelerateSpeakingtheSameLanguage-Reporting

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AccelerateSpeakingtheSameLanguage–ChartofAccountsMapping/Normalization

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ExecuteRigorously

• IntegrationManagementisaFullTimeJob• Developintegrationplanandtimelines• Alignresources• Overallprojectlead;assimilateinformation• Identifyandescalateearlywarningsigns• Statusupdates• Measuresuccess• OwntheIntegrationProject

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DetailedProjectPlans

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GanttCharts

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ExecutiveDashboards

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WhenThingsGoWrong…AndTheyWill

• Evaluate• Understandcause• Understandandidentifykeyplayers• Understanddownstreamimpact

• Mitigate• Developaplantoaddressthesituation

• TakeActionandCommunicate• Notifykeyplayersofactionplan,theirrolesinresolution,andexecute• Alertleadershipofsituationandbepreparedtodiscussactionplanandtimelinetoresolution• Informallimpactedpartiesofplanandanychangestheyshouldbeawareof

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MeasureSuccess

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ContinuetheMomentum– 90Days

• TransitionProjectManagementToVariousOwners• Armnewownerswithallofthenecessarytools• Projectplans• Communicationsplans• Trainingmaterials

• Listofinternalandexternalresources• Keepprojectstatusupdateswithexecutivemanagementinplaceuntilentireprojectiscomplete

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Don’tLoseSightofLonger-TermMilestonesDay1 Day30 Day90 Day180

Operations • CustomerOverlapAnalysis• SynergyIdentification

• OverlappingCustomerCoverage

• SalesForceTraining• ContractPrioritization• ContractRoadmap• SalesPlanDevelopment

• SingleCommissionStructure

Accounting • Acquisition HardClose• Create‘NewCo’• CheckSigningAuthority/Printing• Vendor Comparison &Upload• Acquisition Budget

• PurchasePriceAllocation• EquityCalculations&Entry• InterimMonth-end Close• Reviewof SupplierSpend

Reports

• Accounting SystemMigration • BankAccountConsolidation• CorpCC/Travel&Expense

Migration

IT • MembershipScrub• MemberListDistribution

• IT&SecurityAssessment • LOBandSalesCRMMigration• PSAandRMMTool Migration

• Laptops,Desktops, Infrastructure

HR • I-9Verification • EmployeeBadge-over, Onboarding• Acquisition Compensation Adj.• 401KOwnershipTransfer• Acquisition BenefitsEnrollment• PayrollMigration

Communications • PressRelease• InternalBuyerComms• Acquisition SupplierComms• BuyerCustomerComms

• Acquisition WelcomeMeeting

• Quarterly/Annual Kickoff • Branding

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