Post Merger Integration Model

The post merger integration model is the method through which both the acquired company and the acquirer define the framework within which they operate. This will include an established effective management through tech-enabled data insights decision-making procedure, a leadership and governance structure including operating model, reporting matrix, and plan for internal and external communications. This planning phase is essential for all departments including the finance and operations department, IT, clinical departments as well as quality, supply chain personnel, HR, and quality.

In the end, the success of PMI will determine the value of the transaction for both parties. Without proper planning and execution, it will be challenging to achieve any planned benefits like the consolidation of platforms, cross selling, geographic or industry expansion as well as cost reductions, etc.

It is vital that the organizational structure be well established and communicated before the start of the PMI in order to set the stage for the entire project. This can be accomplished by clarifying roles, responsibilities and expectations from the start and will reduce conflicts and resistance.

A significant amount of work will be required in this area, as two merged companies often have different business practices as well as policies and procedures that must be brought into alignment. For example when one company keeps transactional data in books and the other uses an ERP system, considerable effort will be devoted to making their systems compatible.

This is when major changes and integrations are made to ensure that the final procedures were conceived and developed. During this stage the new company will implement the combined business strategies and will use the best practices of both companies to create synergies.

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