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Choosing an integration leader? Here's advice from past M&A execs.

Integration Manager_Photo.jpg

Choosing an integration leader? Here's advice from past M&A execs.

When your company is about to embark on a major merger or acquisition effort, one of the first moves you make will be the assignment of an executive to oversee and drive the integration process. It's a critical, lynch-pin role and the success or failure of the entire integration can depend on getting the right person to lead the charge. Even when staffed correctly, the role is not without its share of challenges. But it can be extremely rewarding too. We recently sat down with two former integration executives and asked them several questions about their experience at the helm of significant integrations that they were responsible for leading.

Ron Pelletier was a seasoned Director of Finance for Rogers Corporation, a publicly-traded manufacturer with operations throughout the U.S., Europe and Asia when he was tapped to lead a significant acquisition for the company -- the first for the organization in several years.

Taylor White was a Senior Vice President for Vizient and had served in multiple finance and operating executive roles in the organization when he was approached about serving as the integration lead for a merger with one of the company's joint venture partners. Then he was tapped again when the newly-combined organization pursued and closed an even larger and more complex acquisition less than 12 months after the first. 

Common Traits of Successful Integration Managers

White and Pelletier had several shared traits that helped define their leadership style and contributed significantly to their extreme success in the integration executive role. These included:

  • Significant tenure at the company
  • Respect and trust from within the organization
  • A sense of urgency balanced with a patience 
  • Highly objective decision-making style
  • Capability to consider multiple, sometimes conflicting factors in making decisions
  • A collaborative style augmented by great intuition about when to pull the right folks together to gather points of view and facilitate consensus on key decisions
  • An approach-ability reinforced by well-honed active listening skills

It is also worth noting that both executives came from the acquiring company. In our experience, assigning an integration leader from the acquired company rarely - if ever - turns out well. In addition, both executives were supported by project management and consulting resources that helped them leverage their time and focus on the highest priority issues, risks and decisions within the assigned Steering Committee and project teams.

Length of the Integration Executive Assignment

The amount of time an integration leader serves in his or her role is dependent on several factors including the size of the deal, the complexity of the integration, and how quickly the new, combined organization structure can be defined and implemented. Typically we see integration executives serve in their roles anywhere from 6 months to 12 months for deals ranging from $50 Million to $3 Billion in transaction size.

In Pelletier's case, he was in the role for 6 months. For White, who had to tackle back to back deals, he served in the role for 18 months. In both cases, the leaders were promised roles once their tour was complete - either specifically or generally. "I knew from the beginning that I would return to my VP of Finance role after the integration was complete," said Pelletier.

For White, it was a bit different in that no specific role was outlined. White said "the role wasn't specified, but I received assurances from my CEO and President to whom I reported that there would be multiple opportunities for me. They've always honored their word, so I trusted them and they indeed followed through." White took a role as the Senior Vice President over the Corporate Development function once his tour of duty as an integration executive ended. When asked if the uncertainty about where he might land was at any time bothersome, White added, "Actually, I believe it was beneficial not knowing where I would eventually land. This allowed me to be fully committed to the integration, probably more objective and made it easier to focus on the highest priority areas for the overall integration effort."

Challenges and Rewards

In our conversations with White and Pellitier, we also asked them to reflect on the most challenging and rewarding parts of the role.  

Q: What did you find most challenging for you personally about the role of Integration Executive?

Taylor White: "Getting the organization aligned was tough. Getting everyone to want and work toward the same outcome. Integrations are predictably littered with conflicting objectives, ulterior motives and communication snags - all of which made it challenging to get people pulling in the same direction. We ultimately achieved this, but it was not easy."

Ron Pellitier: "Managing up. Because this was the first acquisition we had done in a while, there was a high degree of interest which translated into broad participation from leaders in the decision making process. We started with a smaller ordained decision making group, but it quickly grew, which meant more time framing decisions, weighing alternatives and setting our direction on a multitude of issues."

Taylor White: "Promoting transparent discussions - like in any M&A - was challenging, especially at the beginning. We had a well-defined, interim decision-making body but that group had to operate before executive appointments were finalized. Facilitating open, authentic debate on several complex issues was critical but difficult to achieve."

Ron Pelletier: "Getting folks to commit to a timeline. In the acquisition integration environment there are a lot of unknowns, so extracting even soft commitments for completing key integration initiatives took a lot of discussion and work."

Q: What did you find most rewarding?

Ron Pelletier: "Without question, it was the relationships I built with people. Part of the Integration Executive role involves serving as an ambassador - a connector - between people in the acquired organization and the buyer. Often times even an advocate for folks in the acquired organization. Through that process,  I was rewarded with many strengthened and new long-standing relationships."

Taylor White: "I really enjoyed the part of the role that involved serving as the key communication point for so many people. I had a total view that spanned the terms of the purchase agreement, the regulatory approval process, and every aspect of the integration planning effort. That view allowed me to help other executives and our project teams understand the total picture so they could more effectively get their work done."

Ron Pelletier: "The importance of the effort and the visibility that came with it were also rewarding. When you are doing integration work, the spotlight is on. Everyone from the board of directors down to every employee and even customers, suppliers and the media are watching. I enjoyed that, especially as we made fast progress and enjoyed many successes along the way."  

Choose Carefully

As you can see, the role of Integration Executive is a complex, multi-faceted role. And the choice of who you put in that role has serious implications that can be felt years after a transaction is consummated. So make that choice with care. For some additional help in making the important assignment, see the link below to our Candidate for Integration Leader Assessment Tool.

 

Download our Integration Leader Candidate Assessment Tool

 

 

 

 

 

 

 


 

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