Starting with [last week’s challenge]((/archives/scenarios/2024/11/08/scenario-7-preexisting-initatives.html):

There are many initiatives going on within a company all driven towards a common strategy. Some are departmental based and others involve the entire line of business. When you are looking at a strategic acquisition, these usually start at the line of business and build on from there.

With most IT departments, they will have their own goals to support the entire business, and word of the acquisition will definitely have an impact on what is currently in-flight (cloud migration and modernization work for example).

Looking at a very high level, what kinds of risks and rewards could this pose for you?

Yes this is intended to be a very big and vague question to let your imagination flow. For the most common strategic initiatives within an IT department, you could have anything from:

  • Major re-platforming or upgrades of critical infrastructure (think databases or middleware upgrade)
  • Modernization initiatives (going on-prem to the cloud or cloud-native technologies)
  • New tech adoption such as AI or transitioning towards SaaS based offerings

The risks can be numerous between resource contention as the implementer will be split between the initiatives and the integration effort. There can also be delays and tech debt added as a result of bridging the integration until the new initiative completes.

One example, if you are in the middle of migrating CRMs, regardless of what the acquirer uses, you will have to chose between putting it in the old system or new. Depending on which one will dictate how accurate your sales numbers will be if it is on the new one, or will increase migration time when put into the older system.

On the flip side, there could be some major rewards: if your acquirer happens to already be on the platform your company is transitioning to, then you could use it to feed into what the new ecosystem will look like with not only minimal work, but if you have staff coming along with the acquisition, you have ready-trained experts in the new world that can help speed up the initiative.

One of the most critical things that can be done once you are getting serious about acquiring someone is evaluate the initiatives underway from your company’s standpoint and war-game it. This way, your team will have a much better grasp on what questions to ask during the due diligence.

What other scenarios can you think of? Hit REPLY and let me know!

cab