Most of us have brands we prefer. I myself particularly like two delicious Scandinavian chocolate bars that my family traditionally enjoys during holidays. When the company behind them was acquired some years ago by a major multinational I had misgivings. What was going to happen to my favorite treats? Would they taste the same? Would I be able to buy them from the same shops as before?
Of course, it wasn’t anything that kept me awake nights. But just suppose those misgivings had caused me – and others – to switch preference to another brand?
Customer experience is an aspect of mergers and acquisitions that isn’t as often considered as it should be across all the functions within an organization. Outside sales and marketing the most commonly discussed M&A issues tend to be operational alignment, consolidation and economies of scale. But what about the possible effect of the transition on customers? In my opinion this should be one of the key factors to be taken into account. Dwindling loyalties may mean the newly merged business is worth less than the sum of its parts.
Here are a few relevant considerations for anyone entering into a merger and acquisition:
The mechanics of the transition are crucial, not just for alignment and consolidation and those other macro issues but for the continued goodwill of the customer base. That’s why the IT functions of both organizations need to be involved at an early stage to ensure enough time to plan and execute the integration of key systems. (I’ll come back to this in a moment.)
The next consideration is going to be just as crucial. You’re going to need to…
… step outside the bubble
The digital customer experience is a case in point. Say you’re an airline. If you were your own customer, how would your online booking experience be affected? Or say you’re a bank. Would online credentials checking still work OK for you as a customer, or would it put new obstacles in your path?
In the midst of an M&A we should step outside our business role and try to see ourselves as others see us. These insights should be fed back into the integration process. It may seem self-evident to say so here, but often it’s the obvious things that are overlooked.
This is the big one. I already said the process needs to start early. But it also needs to be comprehensive, and those two needs tend to pull in opposite directions. How can you do everything, but do it fast?
Draw up a list of all the processes involved. If you could regard them as modules, and those modules could be assembled ready-made and moved into position for as long as it took for the M&A to be completed, what would that look like?
Here at Capgemini around a year ago now we introduced our Business Process as a Stack and also the Virtual Company concept. Virtual Company, in particular, is designed to address the state of flux in which many global enterprises find themselves, particularly during mergers and acquisitions. It brings together a cloud-based infrastructure, enterprise applications and key business processes and services in a standardized suite, enabling companies to achieve a secure and fast deployment of digital operations. Transformed processes are customer-centric and run on one global standard.
The faster these operations can be brought into line the sooner the issues affecting the digital customer experience can be addressed. A holistic approach of this kind also means a single customer view can be achieved much more quickly. Synergies can be identified and acted upon.
With Business Process as a Stack and the Virtual Company approach helping to secure a single customer view, problems become opportunities. Instead of safeguarding against the risk of losing customers you can give them new reasons to stay.
Keep people posted
Communication with your customers is important at all times but in case of M&A it’s crucial.
Imagine you’re waiting for a train. There’s a delay, nothing is announced and the train arrives without notice ten minutes late.
Now let’s say it’s the next day and the same train is once more delayed. This time it’s 15 minutes late – but the platform information sign tells you so, and counts down until the train arrives.
Which scenario is more irritating to the customer? The first one, of course – even though the delay is shorter.
People like to be kept informed. If the M&A is going to mean, for instance, a temporary suspension of an online ordering system, be sure to tell your customers – and be sure to tell them early. If you have a fully integrated view it’s much easier to project-manage the whole process and so build in a communications program for your customers.
The principal aim of an M&A is growth – growth in revenue and also in market share. Customer concerns are integral to business value. If you can start early, think as your customers do and keep them informed you’ll address those concerns, and in doing so you’ll not only earn their goodwill but consolidate the principle on which the M&A was grounded in the first place.
Luckily for me, my favorite chocolate bars didn’t change. Nowadays I can even shop for them online. I wish all M&A stories ended with customers as happy as I am.