Post Merger Integration Model

The post merger integration model is the method that helps both the acquired company and the acquirer set the framework in which they operate. This includes a decision-making process, management and governance structure, reporting matrix, operating model, and plans for external and internal communications. It is vital that all departments are part of the planning phase including finance, operations IT, clinical departments quality, supply chain as well as human resources and staff.

In the end, the success of PMI will determine the value of the transaction for both parties. Any benefits that are planned, whether they come from platform consolidation, cross-selling or expansion of industry or geographical or cost reduction, are difficult to realize without proper planning and execution.

It is crucial that the organizational structure is clearly defined and communicated prior to the PMI. This will define the tone for the entire project. Setting roles, responsibilities and expectations early on will help minimize conflicts and resistance.

This will require a lot of work since the two merging companies may have different policies, procedures, and business processes. If, for example, one company has its transactions recorded in books while the other uses an enterprise resource planning system, it will require a lot of work to ensure that their systems are compatible.

This is the point where major adjustments and integrations are made in order to meet the final-state procedures that were formulated and planned. In this phase the company that is acquired will implement the business strategies that are combined and apply best practices from both businesses to realize synergies.

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