For many people on the front lines of M&A integration who are responsible for obtaining product synergies from the combined assets of different companies, integrating data models often emerges as a priority in the quest for Post-merger / acquisition grail. The same sentiment would likely carry over to customers, at least those who have experienced supplier consolidation in the past. But, in fact, the integration of the data model is only step 3 (out of 5 steps) of the integration of the post-acquisition technology – this is the midpoint! And with my apologies, to the Monty Python team, this is not an ordinary rabbit!
In this Spend Matters PRO series, we define, introduce, and explore the five levels of M&A technology integration that vendors must go through when bringing together different modules and platforms. Note, however, that the grouping of different applications and technological stacks is not a prerequisite for any acquisition. But whenever a technology provider wants to commercialize and achieve synergies with their customers through a transaction outside the expected degree of integration, its timing and eventual completion must be a priority for investors and customers.
Today we’re exploring the third level of integration that occurs in a post-merger situation or when vendors replace old technology on a new stack while retaining the capability of the existing solution on the existing platform. From a vendor’s perspective, we define how to do this and provide examples of this type of integration. And from the user’s perspective, we suggest tips and tricks for tech buyers to discern this level of integration compared to others.
If you’re new to this series and want to learn all five levels of integration, start with this intro, which explains in detail the partially obscured chart below.
In previous installments, we covered the integration levels of stages 1 and 2 in detail.