Global PMI Partners Whitepaper | by Scott Whitaker
How to Build an Effective M&A PlaybookFor frequent acquirers, playbook applications offer a method to standardize a very complex task consistently across an organization. Business leaders tasked with leading an integration will find playbooks integral to achieving integration objectives and driving successful execution.
Table Of Content
1 Basic Objectives
2 Driving Adoption
3 Ongoing Optimization
4 Playbook Contents
5 Visual Details
6 Tools & Templates
7 About Global PMI Partners
Integration playbooks sound great but seldom are.
Many of the playbooks I see are simply collections of templates and artifacts fromprevious integrations. Some steps and outputs may be documented, but they are oftenout of sequence and confusing to anyone trying to leverage the playbook to inform theirintegration planning.
While I applaud anyone trying to better organize the complex task of integration, a poorlyexecuted playbook can often confuse more than help.
A comprehensive playbook solution should achieve the following basic objectives:
Provide a methodology that ensures value capture and the achievement of integration and synergyobjectives
Facilitates a structured approach and methodology to integrate newly acquired companies
Ensures consistency and standardization across integration teams
Maximizes efficiency by leveraging proven processes and tools/templates
Flexibility to accommodate varying transaction sizes and levels of complexity
Easy to train and implement to facilitate knowledge transfer
Takes the guesswork out of integration planning & execution
Transform a complex activity into an easy to manage the process with defined phases, steps, anddeliverables
Provide battle-tested tools & templates to accelerate the completion of key deliverables
Provide an intuitive platform for training
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Well designed and architected playbooks can also help with the following:
Connect corporate development processes to integration planning processes
Specify who needs to be involved and when
Anticipate and document key decision needs required in each phase
Document anticipated risks and issues requiring action
Provide parameters to ensure Day 1 readiness
Outline processes and steps for unique M&A scenarios (e.g. carve-outs)
Provide clear rules of engagement and protocols for managing sensitive information
Simplicity: Good playbooks aren’t over-engineered. Focus on basic needs first and layer in complexity as needed
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Driving Adoption
The key to the successful implementation of a playbook solution is adoption. Leaders need tosee the value immediately and embrace the process. Assume you need to “sell” your leadershipteam on using the playbook!
Key steps include:
Connect the playbook value and benefits directly to helping achieve the integration objectives
Highlight efficiency gains that can be leveraged via playbook usage
Design a robust training and knowledge transfer plan to facilitate implementation1
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Ongoing Optimization
Don’t let your playbook become static and inflexible! Playbooks are living articulations of adefined process and need to be updated and optimized near the conclusion of your integration.
Key steps include:
Create an internal SharePoint for the corporate playbook to avoid version control headaches
Conduct after-action interviews with integration team members to collect feedback that canbe used to optimize playbook steps, deliverables, tools and templates
Make sure the SharePoint site includes all of the tools, templates, and work product samplesso they can be accessed by new teams when needed-avoid recreating the wheel for eachintegration!
Playbooks should be flexible and adaptable for specific requirements:
Applicable to all acquisition scenarios (bolt-on, platform consolidations, adjacent marketacquisitions, vertical integrations etc.)
Deployable across multiple concurrent transactions and geographies
Ability to select and/or deselect the specific process steps and supporting tools/templatesthey need based on the size and complexity of their transaction (i.e. not all playbook processsteps may be required for certain transactions)
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Dynamic playbook solutions cover integration planning and execution process, tools &templates, program management support, and training.
Playbook Contents
The playbook solutions we architect at Global PMI Partners for our clients include the followingcommon elements:
Playbook Overview:Essentially the “user’s guide” for playbook application with details on purpose, use, activationsteps, contents, administration details, training and links to all materials (which as mentionedare typically located on an internal SharePoint).
Glossary:M&A and integrations generate a lot of terms and acronyms…and don’t assume everyone knowswhat they mean. To assist with training and general convenience we always include a glossary ofterms and explanations of key playbook elements.
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Diligence Priorities:This section includes key data requirements to inform integration planning (not to be confusedwith pre-deal financial diligence). This section includes data needs to inform more detailedintegration plan development for corporate functions like HR, IT, S&M, etc.
Phasing:The playbook includes detailed phase modules covering pre-close thru end state for the mosttypical integration scenarios. Our most common solutions include Five Phases outlined below(we do customize phasing to meet unique client specifications as well)
Pre-Deal: The phase when potential target(s) are in discussions with corporate developmentand deal, is activated (likelihood of deal is greater than 50% and an LOI and PA are active)
Integration Planning: Phase when the bulk of the preparation required to fully engage andmobilizing an IMO (Integration Management Office) is completed
IMO Mobilization: The Mobilization phase is where the extended functional leads are engagedand the comprehensive integration and Day plans are developed
Execution: The execution phase encompasses delivery of activities that have been pre-planned and mobilized, and also includes monitoring and controlling activities driven by theIntegration Management Office.
Optimization & Close: The Optimization and Close phase occurs across all phases provideinput on integration execution and to complete all administration tasks at the end of theintegration project.
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Involvement by Phase:This section details who needs to be involved at each stage which helps prevent:
Engaging people too early before there’s meaningful work to do
Specifying who needs to be involved to prevent overstaffing (we find people generally wantto be part of the integration team…but don’t need to. You need most people focused on theday to day business, so making some clear lines here is important.)
Considerations:Each phase includes a “Considerations” section where we include application and best practicestips to help facilitate knowledge transfer and to assist with training.We include common “watch outs” and lessons learned to help navigate the nuances of soundintegration management and execution.
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Visual examples from a typical playbook solutionNote: this is a sample from a custom solution and may not represent your integrationrequirements.
Phase DetailsHere’s a sample of phase detail for mobilization detailing each phase’s description, objectives,personnel, key decisions ad timing & duration guidance.
ConsiderationsA sample of best practice and lessons learned highlighted for the Integration Planning Phase
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Step by Step DetailA snapshot of a few steps in the IMO Mobilization phase. This part of the playbook is the mostdetailed, prescriptive and customized with dozens of steps.
Tool & TemplatesThe average integration will produce dozens, if not hundreds of templates and artifacts. Theexhibit below shows a sample of tools, templates, and artifacts from an integration that will behoused on a SharePoint.
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For frequent acquirers, playbook applications offer a method to standardize a very complex task consistently across an organization. Business leaders tasked with leading an integration will find playbooks integral to achieving integration objectives and driving successful execution.
About Global PMI Partners
Global PMI Partners specializes in post-merger integration (PMI).
We’ve established a global network of PMI experts to deliver market-relevant advice to our clients worldwide who want to build lasting domestic and cross-border businesses. Our global team includes only seasoned senior-level consultants, which allows us to deliver services at a higher standard, with greater consistency and more cost-effectiveness than a mixed team of trainees and experienced professionals. When it comes to results, Global PMI Partners has a reputation for delivering exceptional consistency and speed to each project.
Where others follow a rigid, one-size-fits-all process, our standards are different. We’re valued for our dynamic, customized execution on the complex operational, technical and cultural issues that are so critical to M&A success.
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