Sustainable Acquisitions Demand Complete System Optimization

Large companies pursuing serial acquisitions must prioritize operations and workflow. Our experience has shown the significant impact of updating systems on a business’s overall functioning, especially for companies built through multiple acquisitions. Overlooking the rationalization of business processes typically results in preventable complications. Our clients rely on ESG’s pattern-recognition expertise, toolsets, and hands-on support honed on more than three decades and hundreds of acquisitions to guide them through critical early-stage planning in these areas.

Every Acquisition Needs a Commited Change Champion

Recently at ESG, a global Fortune 500 client EVP client recognized the need for seismic shifts in their organization to stay competitive. However, the company’s neglect of back-office systems left them unable to implement essential technological advancements. After nearly two decades of deprioritizing back-office investments, they now faced the daunting task of significantly modernizing systems, transforming operations, and retraining employees—all while attracting new talent and mitigating complications that would directly impact front-of-house operations.

This client enlisted ESG to assess their structural health and change readiness. After evaluation, we identified key challenges and potential solutions to remedy the risks at hand. For example, despite eagerness for change, they lacked direction. Through our team’s expertise, we highlighted areas needing higher governance and guidance, and delivered a comprehensive plan based on a proven success framework. This enabled them to prioritize and execute their transformation around people, process, and technology.

In Summary

Here are some patterns we’ve recognized around large scale transformation acquirer plans:

Consistencies in Transformational Changes

Oftentimes, companies make the assumption that their systems and operations will effectively transition to the company being acquired. However, our experiences suggest that there can be a disconnect between what has worked for one company and what will work for both. Legacy systems, inefficient workflows, conflicts in process based on differing industries or outputs – these can all complicate an acquisition and create unsteady footing for new and old colleagues alike. Change management may be required for all parties involved – not just the one being acquired. Regardless of whether your company is in the process of acquiring or getting acquired, it’s important to proactively assess what works for your systems and where there are gaps of opportunity that can be optimized through this engagement to prevent delays and stopgaps.

Alignment of Internal and Customer-Facing Operations

Focusing solely on customer-facing operations post-acquisition might seem intuitive, but it’s a mistake to neglect back-office modernization. Without updating these systems, your team is unable to internally operate at a sustainable pace, which in turn can negatively affect customer satisfaction and overall business growth. A delay on the backend (e.g. slow processing servers) may result in an even more significant reaction on the frontend (e.g. a frustrated customer complaining about your company’s slow customer service online or to their circle of colleagues).

Backend optimization may not show immediate impact in comparison to a frontend overhaul, but it will certainly show detrimental, long-term impact to multiple layers of your business if left unchecked.

A Change Champion

Successful integrations and technology transformations always have a clear leader or team spearheading the rationale for exponential change and navigating the internal conflicts that arise between leadership teams with differing visions. Having respected, credible, and operationally-focused leadership ensures that all activities are well-coordinated and communicated. Empowered senior sponsors manage clarity on the mission at hand and keep customers at the forefront, all while maintaining in-house expectations and communicating areas of friction.

The Future Belongs to Those Who Adapt

Reimagining business workflows and supporting systems for enhanced colleague and customer experiences is vital for sustained growth. At ESG, we understand the complexities of transformational changes, especially when dealing with numerous systems in any acquisition environment. Contact us today to learn more, and discuss how we can support your process.

Author

Mark Newhall

Founder of ESG

Other Blogs
September 4, 2024Execution Specialists Group (ESG), a strategy execution-focused consultancy based in Denver, CO, continues to expand their cross-industry enterprise artificial intelligence advisory practice for global clientele with the addition of PMO and IT solutions executive Richard Steele.  Formerly the Director of the Central Portfolio Management Office (CPMO) at Charles Schwab, Rich built the organization’s global practice, leading transformational change, organizational change management, PMO operations, risks and controls, tools, financials, and reporting while supporting a $500M project portfolio. In his role, Rich also implemented innovative project and risk management frameworks and Agile best practices, and partnered with IT leaders, finance, and accounting to develop comprehensive resource planning. Throughout his more than 25 years of experience, Rich has also held leadership roles at Lewis Fowler, DaVita, and JPMorgan Chase, and has helped companies define their strategic direction through establishing clear outcomes and measures. “Execution Specialist Group’s large enterprise clients are moving quickly to implement AI solutions, realizing that disciplined planning and execution are as critical with AI-centered technology initiatives as any of the complex initiatives they have previously undertaken, particularly when the technology is a catalyst for massive changes to business and operating models,” Mark Newhall, CEO of Execution Specialist Group emphasized. “At ESG, we continue to invest in resources that shape and support execution of these critical initiatives, just like our clients. We are thrilled to have Rich join our team as our Enterprise AI Practice Leader to support our clients and develop effective AI strategy and implementation planning for sustainable execution.” About ESGHeadquartered in Denver, Colorado, Execution Specialists Group (ESG) is a strategy execution-focused consultancy with extensive global experience engaging with client senior leadership to plan and deliver on complex innovation and transformation objectives. ESG relentlessly focuses on delivering meaningful client outcomes and leaving behind a culture of execution. Recognized by Forbes as one of America’s Best Management Consulting Firms six times in the areas of Business Strategy and Supply Chain Management, ESG clients include The Adecco Group, Advance Auto Parts, Bridgestone, Caesars Entertainment, DexKo Global, Gordon Food Service, Parts Town, Target Corporation, and more. To learn more about ESG, visit www.esgimpact.com. Media ContactSara Blakelysblakely@esgimpact.com [...] Read more...
August 23, 2018There is a lot of press currently where CIO’s and other technology and business leaders are trying to move away from ‘IT Project Management.’ There is push toward business-led PMO’s, ‘Project’ Managers/ Owners and other variances. I see this happening in two ways. Tech has historically been generally bad at large scale projects and has poisoned the phrase ‘IT project’ so we need a semantic reboot. Branding is important; Let’s give it a new brand, name, tag. The key is that it cannot stop there. The NEW methods are really variations of how we should have managed projects/programs all along. I put to you that the reason why many IT projects fail is that they are not customer focused, they are run from IT only and have no real mini-P&L or financial model that follows it along. If we apply three rules to all technology projects – we can justify the new branding. Company Initiative vs. IT Project: The Initiative needs cross functional ownership – Sales and Marketing NEEDS to be part of a new system rollout, Operations NEEDS to be in lock step, the PM NEEDS to represent all team members. Customer is always in mind: What will this improve for the customer? What will this take away from a customer? What is valued by the customer? What customer risk are we taking and how to we mitigate them? If you are not asking these questions, you are risking the most important stakeholder. Run it like a business offering: The project/product/program should have its financial assumptions well mapped out and they should be reviewed and revised as thing progress. A mini-P&L or balanced scorecard like statement should be part of the updates and should be kept visible. As a 6-sigma person I believe in ‘to improve, you must first measure.’ This statement should reflect what truly determines if the project is successful or not. I am all for re-branding technology project to the name de jure but the more important aspect to success is ensuring we are doing what we have known all along should be done. Agree, disagree or want to talk about how to get there? Reach out and let me know. mbailey@esgimpact.com —By Michael Bailey, Principal, ESG   About Michael Bailey Global technology executive Michael Bailey excels at large-scale systems consolidations and business transformations. With three decades of experience translating business into technology—and vice versa—Michael specializes in the seeing the big picture and defining clear and tactical steps to get there. He’s a Six Sigma Black Belt who delivers operational excellence.   As a Principal at Denver-based consultancy Execution Specialists Group (ESG), Michael is focused on working with clients to drive transformation through complex program leadership, change management, and defining technology roadmaps that complement a client investment cycles. Michael leverages his global acquisition and integration experience with differentiating technology across brands, business units and industries including maritime shipping, biotech, internet provisioning, office products, print management, promotional marketing, retail, restaurant and commercial kitchen supplies, equipment and parts. Additional information on Michael Bailey can be found on LinkedIn. Printer Friendly Version [...] Read more...
February 20, 2018It has been said that “to everything, there is a season.” Truer words were never spoken regarding the cycles a business will go through. Growth happens, chaos occurs. Wash. Rinse. Repeat. It is unavoidable. As businesses look to sustain growth, inevitably the notion of M&A – or at least some form of integration – will occur. For those companies that walk this path, they will find that the successful integration of two entities has the potential to grind the gears of a company’s well oiled-machine to a halt if not executed correctly. Integration and/or transformation require a fundamentally different set of skills, views and personas than what is required during more “peaceful” seasons. However, in a corporate environment full of consolidation where the “merge-or-perish” mindset thrives, many chief executives are increasingly taking inventory of the skillsets of their leadership teams to determine which members are equipped to help guide the company through more turbulent times. This should not be read as a criticism of a disciplined and well-trained leadership team that has helped a company achieve sustained organic growth over time. On the contrary, companies make enormous investments in cultivating employees’ professional and leadership skills that are routinely applied to roles like marketing, customer service, supply chain management and human resources that typically rely on solid interpersonal skills as part of their functions. Problem is – those skills are most reliable and repeatable when a company is in a “peacetime” growth mode – acquiring customers, establishing networks, creating a partner ecosystem, etc. Once the potential for a more acquisitive style of growth occurs, however, many top leaders find that their most successful “peacetime” leaders are not equipped to develop an effective integration strategy and execution plan. The “wartime” skills required during these seasons are seldom possessed by the same executives that grew the business organically. In a 2011 book, VC guru Ben Horowitz clearly defined his ideal Wartime CEO (complete with essential Godfather references); in a transformative situation the remainder of the C-suite will inevitably face that same level of scrutiny. To be clear: the solution is not to replace your leadership team if/when you get involved in corporate transformation. That’s simply inviting chaos and is likely not needed. For many companies the season of integration is much shorter, and their need for wartime leaders is seldom permanent – but rather more lumpy. And, to be fair, it’s important to recognize that it’s nearly impossible for individuals to successfully focus on the day-to-day operations of a company while also sufficiently planning and executing a merger or integration. It therefore makes sense for chief executives to assess their C-Suite to determine on which side of the aisle their top leaders reside.  Armed with an accurate view, leaders can consider if it makes sense to re-write roles and responsibilities within a team, and focus people on what they do best – if even for a short period of time. From more than 30 years of experience ensuring successful integrations, we believe there are a few important traits leaders should look for from the “wartime” team. These include: Microtasking: Wartime executives cannot afford the luxury of big-picture thinking or collaborative strategizing. Instead, every detail needs to be carefully managed and every decision made with confidence and deliberation. If business is chess, a wartime exec views the whole board, not just one move ahead. Decisiveness: When M&A is on the table, executives are often asked to make hard decisions that impact lives and families. It’s not for the faint of heart and once decisions are made, there is no time for wavering. Big choices need to be made, and moved on with no looking back. The ability to focus and maintain resolve are skills that don’t come easily to everyone, but they can be honed with experience and knowledge. Clarity: During a transformative period, any confusion regarding the strategy and action plan will inevitably lead to discontent and disruption. Leadership teams need to know the what, the why and the how of the strategy and buy into it, and help ensure that employees have similar clarity of purpose. Even the most consistent and productive executives sometimes have difficulty acting as change agents, but the wartime leader sets a clear path, embraces transition and approaches change objectively. It is, of course, much easier to write about a reassessment of a company’s leadership team than to actually execute a changeover. Again, the priority for CEOs should always be to keep their company’s operations running at full capacity, with minimal disruption. So while it makes sense to identify the best internal resources to execute a transformation, it’s also worth exploring third-parties that can act as a de facto wartime C-suite. M&A integration specialists provide independent and practical perspective. Assuming they have the expertise that comes with repeated exposure to M&A activity, the right consultant can execute a transformation with focus, clarity and subjectivity that is often impossible for an internal legacy team to manage.          —By Mark Newhall, ESG Founder and CEO Printer Friendly Version [...] Read more...
February 13, 2018Execution Specialists Group (ESG), a strategy execution-focused consultancy,  is pleased to announce the appointment of ESG’s Chief Financial Officer, Jodi Mercer, to the Emily Griffith Foundation Board of Directors for a three-year term (2018-2020).   Mercer joins the Emily Griffith Foundation Board with more than 17 years of senior executive and distribution industry experience in both field and corporate finance and accounting. She currently serves as CFO of ESG, responsible for long term financial planning compliance and reporting and treasury functions.  Prior to ESG she was Vice President / Corporate Controller for Renewable Energy Systems Americas and held numerous financial leadership roles with  CRG West, Corporate Express and Clopay Corporation.   In addition to her finance background, Mercer is the Treasurer and Secretary of the Making Strategy Happen Foundation, the charitable arm of ESG, and volunteers as a mentor with Women’s Bean Project, one of the Foundation’s partner organizations. She is actively involved with a number of animal welfare organizations as well. “We are delighted to have Jodi join our Board of Directors,” said Alby Segall, President of Emily Griffith Foundation. “Jodi brings nearly two decades of financial expertise as well as previous foundation board experience to our Board of Directors and her skills and experience will be valuable to help us meet our Foundation goals.” “I am passionate about the Foundation’s purpose to provide resources to ensure opportunity for all who wish to learn,” said Mercer. “I truly admire the thought leadership on the future of workforce development and feel we’re at an inflection point right now. By joining the Foundation Board, I want to help drive our leadership nationally in this space, while championing workforce education.” Emily Griffith Foundation provides financial support to Emily Griffith Technical College which enables the school to keep its tuition rates one of the lowest in the state while providing cutting-edge education in growing industries.   About ESG Based in Denver, Colorado, Execution Specialists Group (ESG) is a strategy execution-focused consultancy with extensive global experience engaging with client senior leadership to plan and deliver on complex integration, transformation, and innovation objectives. ESG relentlessly focuses on delivering meaningful client outcomes and leaving behind a culture of execution. Recognized by Forbes as one of the “Top Management Consulting Firms” for the past two years (2016 and 2017), ESG leaders have managed hundreds of integrations across all functional disciplines including sales, merchandising, supply chain, marketing, real estate, technology, human resources and finance to deliver disciplined program design and execution. Clients include Caesars Entertainment, Gordon Food Service, Office Depot/OfficeMax, Staples, Target Corporation, Whole Foods and more. To learn more about ESG, visit www.esgimpact.com About Emily Griffith Foundation Our financial support of Emily Griffith Technical College (EGTC)  enables the school to keep its tuition rates one of the lowest in the state while providing cutting-edge education in growing industries.  Our innovative work ensures students have the support they need to succeed — both inside and outside the classroom. As a result, EGTC students enjoy one of the highest completion (89%) and job placement (81%) rates in the state. 100% of EGTC students benefit from our support, which allows every student to graduate without student loan debt. For more information, visit www.egfoundation.org   ESG Media Contact: Jennifer Levasseur (720) 235-0816 x399 mediarelations@esgimpact.com   Emily Griffith Foundation Contact: Alby Segall 303-520-4962 asegall@egfoundation.org [...] Read more...
March 7, 2018DaimlerChrysler.  AOL Time Warner. Exxon-Mobil. These are just some of the high profile case studies (some good, most disastrous) that spring to mind whenever companies start discussing a “merger of equals.” From a strictly technical standpoint, a merger of equals occurs whenever stockholders of both companies trade in their old stock for ownership in a newly created company. But even in transactions where one company is clearly subsuming the other, executives still trot out the “MOE” terminology for purely psychological reasons that have little to do with finance. Even with the lessons of past failures fresh in their minds, corporate leaders continue to peddle new math where 1+1=3. Don’t believe the press release headlines – here are four reasons why it’s time to retire the notion of the perfect corporate marriage: Because no one believes it anyway.  More often than not, executives and marketers use merger of equals-type language for its optics, attempting to put employees, investors, customers and partners at ease. Just as often, the spin only results in more skepticism from all parties. Companies may want their workforce to share their long-term vision for a combined entity, but everyone knows that mergers involve endlessly shifting variables. There’s too many examples of cost-cuttings and sweeping reductions in force for most employees to see past the immediate impact on their daily lives. Politics, politics, politics.  In the first months of a merger, there’s plenty of talk about cooperation, integration, synergies, about setting aside egos and coming together to leverage the strengths of both entities in an unbiased manner. Hogwash. Combining two entrenched hierarchies into a single, fully functioning executive team – all done without hurt feelings, or bruised egos? Sorry, doesn’t happen. And don’t even look twice at terms like “two in a box.” At the end of the day, someone wins and someone loses, and you can usually tell who once you start asking questions like “Who is In Charge of What?” Culture clash. In sports, it isn’t uncommon for competitors to change from adversaries to teammates overnight. In a corporate merger, that scenario is played out on a large scale. What baseball teams might refer to as “good clubhouse chemistry” exists for companies as well, and that environment is often impossible to mass produce or force into existence.  Companies have established personalities and values that cannot be morphed into one simply by combining names with a hyphen. One culture will almost always subsume the other, leaving one legacy company feeling alienated. Square pegs and round holes. Even if cultural, language, and financial barriers are overcome in the course of an MOE, there’s often plain and simple infrastructure and technology integration issues that need to be addressed. What happens to one company’s HR system when a bigger and more expensive system is in use at the other? Can they integrate and, even if they can, does it even make sense to try and force employees to adapt? The larger, more established platforms almost always win out in these situations, with the legacy systems (and the morale of the employees trained on them) often discarded. What makes more sense Given the high stakes, sensitivities and potential pitfalls of any corporate transformation, companies should set a sensible tone at the outset of merger – one that prioritizes facts over feelings. Identify strengths; accept weaknesses: Well ahead of any big announcements, corporate boards and management teams should identify redundancies, recognize their disparate organizations’ strengths and weaknesses and make the tough calls on how to make the combined entity most efficient and profitable. Establish leadership – it won’t just sort itself out: To avoid giving competitors an opportunity to pounce, internal communication of leadership roles should happen immediately, before politics and in-fighting poison the environment. Forget the sunshine and synergy: employees are always better off when they know the chain of command and overall corporate objectives. Be real: As transformations take place, it’s up to corporate leaders to maintain employee morale and engagement. They need to establish fact-based messaging that validates the purpose and potential of the combined entity and enables employees to feel pride of ownership over more than just the company’s financial status. “Merger of equal” messaging makes it nearly impossible for that new mission to establish. “Happy talk” costs employees and company valuable time, when the best practice is to rip off the BandAid of uncertainty and get on with it. Here to help M&A continues to be a fundamental way to drive growth – it’s not always a bad thing. Prudent companies, however, will take a more thoughtful approach when considering this course and will engage the help of business experts who bring together companies, people and systems together on a daily basis – not just every couple years. If the right advisors are chosen, and used correctly, these experts can create a sensible plan that’s heavy on execution, devoid of emotional attachment and able to meet realistic expectations from all involved. —By Mark Newhall, ESG Founder and CEO Printer Friendly Version [...] Read more...
October 11, 2021Execution Specialists Group (ESG), a strategy execution-focused consultancy, today announced that serial entrepreneur and technology business leader Andrew Morgan has been appointed a Principal Consultant with the firm and will lead the practice in the areas of Sales Effectiveness, Operations and Go-To-Market Strategy. Morgan joins ESG with more than 25 years of experience providing employees with opportunities to deliver individual, team, and corporate objectives that drive growth and achieve excellent revenue performance. He comes to ESG from his work as a senior executive strategy advisor where he assisted and advised private companies and private equity firms on pre-acquisition due diligence, corporate growth and transformation strategies, innovation process and execution, investor relations, and sales enablement growth strategies.  Morgan has also held executive positions at RedCloud Content (President and Chief Executive Officer), ECI Software Solutions (President, Distribution Division), Pantheon Spinal (Chief Operating Officer and Co-Founder),  and Red Cheetah Software (Chief Executive Officer, Co-Founder). He serves on several boards of directors including Chairman of the Seton Fund Board of Trustees.  “Andrew’s work as the senior executive of multiple software companies has resulted in significant earnings growth, responsible cost containment, rapid adaptation, and a legacy of high-performing teams,” said Mark Newhall, Founder and CEO of ESG. “Which translates to a great fit to add to the overall value we deliver our clients and we’re excited Andrew is joining our team.” About ESG Headquartered in Denver, Colorado, Execution Specialists Group (ESG) is a strategy execution-focused consultancy with extensive global experience engaging with client senior leadership to plan and deliver on complex innovation and transformation objectives. ESG relentlessly focuses on delivering meaningful client outcomes and leaving behind a culture of execution. Recognized by Forbes as one of America’s Best Management Consulting Firms for six years running in the areas of Business Strategy and Supply Chain Management, ESG clients include Advance Auto Parts, Bridgestone, Caesars Entertainment, Gordon Food Service, Office Depot/OfficeMax, Target Corporation, Whole Foods, and more. To learn more about ESG, visit www.esgimpact.com Media ContactJennifer Levasseur720.235.0816 x399mediarelations@esgimpact.com Printer Friendly Version [...] Read more...