At a Glance
A variety of research indicates that between 46% to 50% of merger and acquisition programmes (M&A) fail. Ensuring a successful acquisition integration is no easy task. Renoir’s approach aims to help client from a tactical perspective by ensuring a structured critical path through both the planning and execution elements of an acquisition integration programme. The following is an example of how we helped one client through their acquisition.
Background
The client is one of the largest petrochemical manufacturers, producers and exporters based in Southeast Asia. It manufactures ethylene oxide (which is converted into ethylene glycols and high purity ethylene oxide), ethoxylates, styrene monomer, propylene oxide and polyols.
By taking full ownership of a relatively small but strategically important chemical joint venture, the client has unlocked options to integrate, optimise and expand its manufacturing operation. This recent acquisition will help to strengthen the overall competitiveness of derivatives’ production and provide opportunities for combined growth strategies in high purity ethylene oxide, mono-ethylene glycol and alcohol ethoxylates.
The Challenge
A major challenge, according to the client’s General Manager was “the integration of one of its recent acquisition’s assets and facilities with its existing units, utilities and organisation”.
Renoir Consulting was invited to help facilitate the integration of this acquisition into the wider family of the client, focusing on organisation design & operational-related integration.
What We Did
With the objective of this project to integrate into the client’s existing systems and processes, Renoir had to ensure that surrounding plant production and safety performance or customer service, logistics, and supply chain operations, were not affected in the process. The protocol was to implement a “ONE SYSTEM, ONE SOLUTION” philosophy across multiple client production sites.
Renoir’s support of the integration process was applied mostly in the following areas:
Project Governance
- Development of a detailed integration plan to include key milestones, detailed activities, resource requirements and risk identification.
- Programme management, support and reporting. The introduction of precise, timely reporting on the status of integration activities at all levels based on project governance structure.
- Interface management between the individual work streams, including integrated plan reviews, interdependency identification and rectification, and inter-departmental review meetings
Implementation Support
- Change management and implementation support in each individual work stream. Provide the expertise and guidance required prior to implementation of any change
- Knowledge transfer and retention, including critical information identification in conjunction with the work stream Leader and Implementation Manager.
- Monitoring and supporting acquisition integration activities through regular assessments and KPI tracking
- Communication programme setup and execution
Implementation was executed according to three pillars – Project Management, Change Management and Operational Integration.
Project Management
Renoir’s tactical approach was to align the operational and organisational aspects of integration between work streams. This ensured that business and IT integration elements progressed in conjunction with approved critical path project milestones. Risks were assessed and highlighted regularly to ensure mitigation plans had been developed, thus minimising risks.
Project progress reporting tools were developed for the client to track progress on both their individual work streams as well as for overall project progress.
Change Management
The Renoir team focused on three main changes – organisation change, process change and behaviour change, during the course of Integration. Each of these processes was crucial to establish a basis for the organisation to adapt to, and finally accept, changes implemented.
The main work scope regarding this pillar was to facilitate procedural changes and ensure resources required had been planned prior to the implementation. A communication programme was also developed and executed to share the project’s progress over time, and ease the discomfort of the staff affected during integration.
Operational Integration
The implemented tools and adjusted behavioural requirements allowed the client’s senior leadership team members and other key management staff to progress smoothly. They were now able to identify gaps in systems and processes, both managerial and technical, to determine training requirements in every department and at every level of the organisation. Additionally, an audit programme ensured that the aligned systems were fully integrated and effective across the whole organisation.
The Results
Renoir’s approach allowed for early identification of problems and risks to the integration process, ensuring a focused problem resolution process. Renoir acted as a catalyst across the client’s organisation to facilitate the new ways of working, systems and processes needed to support all levels of the management team. This ensured a level of synergy and benefits were realised from the integration project.
Renoir’s experience with behaviour change implementation programmes used in conjunction with a variety of proven project management tools, some developed specifically for this project, have helped to ensure a successful integration project in aspects such as safety, performance and financial terms.
Integrate acquisition assets seamlessly through behavioural change.
