Make IT a Partner in Successful M&A Due Diligence

Get IT involved in the M&A process pre-close to help ensure post-close success.

Onsite Workshop

Lack of IT involvement early in an M&A transaction results in:

  • Lack of alignment between IT & M&A business goals
  • Ineffective integration planning and execution
  • Poor risk identification and mitigation
  • Inaccurate budgeting resulting in underestimated integration costs

Getting IT involved early in an M&A transaction results in:

  • Greater alignment between IT and the business
  • Quicker, more informed decision making
  • Effective risk management
  • Faster and smoother post-M&A integration
  • IT being positioned as an innovation driver

Module 1: Launch Due Diligence

The Purpose

  • Determining IT’s current capability to support an M&A transaction.
  • Identifying the goals and objectives the business has for the M&A.
  • Gaining the buy-in of the M&A team and executive management for IT’s involvement with M&A due diligence. 

Key Benefits Achieved

  • Capability for IT to successfully support the business throughout the M&A transaction determined.
  • M&A business goals and objectives identified.
  • IT due diligence team selected.
  • Gaining buy-in for IT’s involvement in M&A due diligence. 

Activities: Outputs:
1.1 Complete & review M&A health check
  • Assessment of M&A capabilities
1.2 Gain executive buy-in for IT involvement in M&A due diligence
  • PowerPoint presentation to make the case for IT involvement in M&A due diligence
1.3 Identify M&A business goals and objectives
  • List of M&A business goals and objectives
1.4 Assemble the IT due diligence team
  • List of IT due diligence team members
1.5 Define success metrics
  • List of business and IT metrics

Module 2: Gather Information

The Purpose

  • Taking a structured due diligence approach that properly evaluates the current state of each organization involved in the M&A transaction.
  • Retrieving critical information from the target organization to help determine the attractiveness of the M&A target.
  • Examining the needs of each organization based on analysis of application and data, infrastructure, IT people, and IT processes at each organization. 

Key Benefits Achieved

  • A clear understanding of the steps that are involved with gathering information on both the target organization and the buying organization.
  • Recognition of the various methods of collecting information from the target, the iterative nature of the collection and documentation process, and the format in which information should be recorded.
  • Understanding the considerations that need to be made when looking at the current state of each organization. 

Activities: Outputs:
2.1 Determine the business capabilities of the target organization
  • Business capability map of the target organization
2.2 Prepare a list of questions for the target organization
  • Information request for target organization
2.3 Create a strategy for on-site discovery
  • On-site discovery strategy
2.4 Retrieve or create a business capability map for the buying organization
  • Business capability map of buying organization
2.5 Identify the master data domain, data sources and system of record at the buying organization
  • List of master data domains, data sources, and system of record identified
2.6 Retrieve (or create) an applications inventory and map to business capabilities at the buying organization
  • Application inventory and mapping
2.7 Identify and consider infrastructure at the buying organization
  • List of infrastructure considerations
2.8 Identify and examine important IT processes at each organization
  • Inventory and analysis of important IT processes
2.9 Retrieve (or create) an IT organizational chart and examine the current IT staff at the buying organization
  • IT organizational chart and evaluation of staff based on competency and capacity

Module 3: Perform Analysis

The Purpose

  • Understanding how the business sees the resultant capabilities in the newly formed organization and determining the best way to support them.
  • Selecting a target technology environment that is aligned with the business objectives for the M&A.
  • Identifying gaps, redundancies, and initiatives for each business domain, and selecting the appropriate IT integration strategies to achieve the target technology environment. 

Key Benefits Achieved

  • Identification of the ideal post-M&A target technology environment.
  • Recognition of the key considerations when determining the appropriate combination of IT integration strategies.
  • Vision of the IT organizational design for the resultant enterprise. 

Activities: Outputs:
3.1 Define the resultant enterprise capability map
  • Resultant enterprise capability map
3.2 Select the target technology environment
  • Target technology environment
3.3 Analyze data and application gaps and redundancies, then determine the IT integration strategies
  • Analysis and integration strategy for data and applications
3.4 Identify the resultant enterprise’s infrastructure needs
  • Infrastructure needs for the resultant enterprise
3.5 Identify IT process gaps and redundancies
  • IT process gaps and redundancies in the resultant enterprise
3.6 Identify IT people needs and redundancies
  • IT people needs and redundancies in the resultant enterprise

Module 4: Estimate Costs

The Purpose

  • Developing assumptions to estimate the remaining capital and operating costs that have not yet been reflected in the integration budget.
  • Preparing the IT Due Diligence Report for final submission to the M&A team.  

Key Benefits Achieved

  • Recognition of how to create an IT integration budget for the M&A transaction during due diligence.

Activities: Outputs:
4.1 Develop assumptions to close remaining M&A gaps
  • Develop assumptions to close remaining M&A gaps
4.2 Finalize IT investment costs and synergies
  • IT investment costs and synergies finalized
4.3 Finalize the IT Due Diligence Report
  • IT Due Diligence Report finalized

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