Transitioning the acquired IT team

Delivering infrastructure economies of scale is a requirement of most mergers or acquisitions. And whether it is reducing application duplication or consolidating servers, there will be staff whose job it is to develop and support the technology that is going to be eliminated. Some may be redeployed, but it is also likely that some will not be needed.

As soon as the transaction is announced, expect CVs to be dusted off and sent to recruiters. And not just from those in the acquired IT team – your own team may be concerned that a reorganisation could put their own roles at risk.

Whilst you shouldn’t expect to reorganise the IT function each time your company acquires another business, you may need to increase the capacity in some areas to accommodate the additional needs placed on them. That said, you should also take the opportunity to reorganise any areas in your existing team that are under-performing.

The IT due diligence report should already identify which of the four approaches your business will be adopting and what is required from each of the three main phases of the IT integration. With this, you should be able to plan your resources. Although the end-point may not be clear yet, the short term needs of the transition can be defined.

Open, honest leadership is what is needed. People can deal with bad news if they have enough time to plan and act. And you only have one chance of gaining the trust of the people you will want to keep. So develop your plan quickly, gain agreement from the business, and then communicate it to everyone.

Staff will generally find themselves in one of four categories:

• their role disappears from the date of the transaction (which means you should have been involved in the decision while the deal is being put together)
• their role disappears but there is a transition role for them for a defined period
• their role disappears, there is a transition role for them and there may be a role for them in the new IT organisation
• their role continues in the new IT organisation.

Work closely with your HR function. Although employment legislation varies from country to country, in most cases the job/role is made redundant, not the person. Your business may offer a voluntary severance package, redundancy, or both.

For those people who are required for the transition only, consider offering them a performance-related retention bonus in addition to redundancy so that they stay and complete what is needed of them for the integration.

For those who may have a role after the transition, consider the performance-related retention bonus as well, but on the understanding that, should they be offered a role in the new organisation, it will be reduced to whatever the ongoing staff get for their part in the integration.

But expect that, while the business will have budgeted for the cost of voluntary severance/redundancy, retention bonuses will not have been considered. Leverage your good relationships within the business to secure the best you can for each person.

Then implement with care and attention. Maintain a regular dialogue with transition and permanent staff. Deal with issues quickly and sensitively. And maintain your honesty and integrity throughout.