I T A N D C OMMUNICATI ONS
Mergers, acquisitions and clouds Nick Arnold of Calligo explains how cloud technology can play a key role in the merger of two businesses
We continue to see a number of mergers and acquisitions (M&As) that bring with them the headache of integrating people, facilities and technology. Technology is a key enabler for the business to achieve its M&A objectives and, by leveraging cloud technologies, you can run a speedy and effective integration programme. Cloud is also relevant in the pre-deal due diligence phase with solutions such as virtual data rooms allowing you to facilitate the transaction, applying confidentiality, security and controlled easy access to the M&A artefacts. The long-tem strategic plan will deal with the final end game – the consolidation of duplicate services, merging teams and moving onto a single IT platform. Depending on size, this can be a 12 to 18 month effort. Then there is the tactical plan. This will deal with the immediate task of enabling the two businesses to collaborate and support the integration project. It will also include detailed inventory of the IT in use and map out how the two organisations will be connected (ensuring security and confidentiality is constantly maintained). Obviously the quicker the combined businesses can work as one, the quicker synergies will occur and the M&A objectives be met. The tactical stream will help to make this happen as soon as possible. Clearly, security is a prime concern. If security vulnerabilities exist in the acquired network, they pose a threat to your environment once you connect them, so you must ensure that proper assessments take place to identify any weak links, and plug them. Regardless of how well managed the acquired company’s IT platform is, it should still be considered as an
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‘untrusted’ network, only becoming trusted once you’ve formally gone through the risk assessments. Virtual desktop solutions (such as Calligo CloudDesk) can be quickly and easily deployed into the newly acquired company on day one. This allows them to use the same computers and the same network that they have in place, but by having a piece of software installed, they can open a window that is effectively a desktop within a desktop.
The end game becomes a single IT platform, with no duplication, available to all users, in all locations. This provides access to applications and tools and allows collaboration enabling the businesses to be productive and to commence working together. In parallel, as part of your strategic plan, you’ll be able to migrate the acquired company data, applications (if they are to be retained), and move to a single platform used across the new organisation. By using the tactical approach it allows the quick wins and provides more time for the application migrations and consolidation to take place. The end game becomes a single IT platform, with no duplication, available to all users, in all locations. Even if both organisations are not on a cloud platform, it can still help the combined business to be agile and effectively transforms them into the single business that meets the M&A target operating model.
You would leverage the cloud service provider’s expertise to review what needs to be migrated, what it needs to run in the cloud (performance), and to work with you to meet the final goal that you’ve set. They are performing migrations from ‘untrusted’ traditional IT platforms into their cloud platform multiple times a week, they have the processes and tools to be able to mitigate any perceived risks or security issues, thus enabling a quick, professional and secure migration. The cloud service provider will perform the routine migration steps, which includes the process to fix vulnerabilities on the fly as the migration comes into the cloud platform. There are no throw away costs since, with this approach, it is all about migrating to the end game. Nothing is wasted. For companies whose business strategy is to grow through acquisition it makes sense to migrate into the cloud platform soonest, as they then have all the benefits, easily supplying their ‘standard’ IT platform to any location, instantly having the ability for all employees to access systems and information without having to overhaul the infrastructure. They can then perform the migration of the new company straight into the cloud; it literally becomes a ‘cookie cutter’ exercise, and mostly routine. An M&A can be a complex process with impact felt by all departments in both the acquired and acquiring business. It can create big headaches for the integration team and IT department. Cloud will help realise cost savings, see the total cost of ownership diminish and enable you to repeat the process many times!