Insights from the merger integration

Prior to the close, Kearney established the structure and processes to ensure a seamless transition on day 1, helped create a new leadership structure, and mapped out all sources of value creation.

Pre-close insights

Prepare well for day 1. Having a new structure and processes in place on day 1 mitigates the risk of a power vacuum, helps maintain momentum throughout the integration, and ensures the right leadership continuity. Ensuring that joint functional and regional teams prepare all aspects of day 1 together is key for a smooth transition.
Ensure the synergy plan is simultaneously achievable and demanding. The synergy plan has to challenge commonly accepted assumptions and recognize where targets can be stretched. This is only possible with a deep understanding of both businesses and the application of proven benchmarks in determining what is feasible in similar mergers.
Recognize there is strength in numbers. This is especially true when you’re talking about pulling two large, global organizations together. Small teams might seem easier to mobilize, but big teams will actually get the job done. This merger had more than 15 functional integration teams with 150 global team members working around the clock to prepare for day 1 and the next 100 days.

After the close, there was more work to do. The focus turned to realizing cost and revenue synergies, which meant engaging employees, exiting transition service agreements (TSAs), and bridging cultural gaps.

Post-close insights

Realize that all successful integrations have one thing in common. Employees feel as if they own the success. Establishing synergy targets from the bottom up rather than top down gets everyone aboard early, increases momentum, and stretches boundaries.
Get out from under TSAs, fast. Operating independently can add new life to the new businesses. Exiting 95 percent of TSAs within 180 days provided much-needed breathing room.
Follow a road map with the aim of combining two unique cultures into one. Begin early, find the gaps and similarities, and then blend. It is important to charter the culture road map during the first days of the integration, run a well-represented cultural survey, and prioritize the more salient gaps.

Impact and advantage

At close, more than 10,000 employees seamlessly transitioned to the new company. And the transition for all the accounts that maintained business continuity was flawless—customers and suppliers hardly noticed and employees knew exactly what to expect. Six months later, the company was on track to surpass the cost-synergy targets promised to “the Street” and on schedule to meet its revenue-synergy targets. Most remarkable was the speed of the integration and synergy realization as country integration teams pushed the limits to achieve their goals. The key factors for success: centralized global planning, local execution, and sheer excellence.