Successful IT Integration: Key to a Company’s Growth after a Merger/Acquisition – An Insurance Perspective

Successful IT Integration: Key to a Company’s Growth after a Merger/Acquisition – An Insurance Perspective

Companies choose Mergers and Acquisitions (M&A), an inorganic growth instrument, as an option to expand their operations due to either a business need or an opportunity. The current financial recession is creating more scope for such Mergers and Acquisitions. A recent Deloitte study predicts an increase of such a trend in Insurance business.

Mergers and Acquisitions, in addition to the exponentially increasing business opportunities bring in cultural differences in Customer and Employee base to the fore and mandate a well-integrated company to achieve the anticipated synergies and M&A business objectives of the combined organization. The success of the integrated company depends greatly on IT Integration. This can be achieved by considering different aspects of IT landscape like Application Rationalization, Technology Architecture Unification, Technology Infrastructure Consolidation and Process Optimization. IT Integration assumes greater significance for the Insurance industry due to its legacy oriented IT systems and high-risk nature of the business.

This paper focuses on the three important IT Integrators and related challenges faced by the combined company, during post M&A scenario, with a focus on Insurance Industry. Firstly, this paper provides an overview on how to achieve a roadmap for IT Application Rationalization, both in short-term and long-term perspectives. Secondly, it also brings in the key aspects considered in the integration of IT infrastructure. Lastly, it highlights the challenges involved in People Integration (Employee Integration and Customer Integration) with some considerations in overcoming those challenges.

Introduction

Companies choose Mergers and Acquisitions, an inorganic growth instrument, as an option to expand their 1 operations due to either a business need or an opportunity. As per the Deloitte study titled The 2009 Insurance M&A outlook Opportunity in an uncertain environment, the recent financial crisis is generating more scope for such M&A as acquisition-minded insurers are likely paying more close attention to developing and emerging markets because of their potential profitability.

M&A, in addition to the exponentially increasing business opportunities, bring in the cultural differences in Customer and Employee base to the fore and pose a major challenge to the combined company in addressing different aspects of IT landscape. These aspects include Application Rationalization, Technology Infrastructure Consolidation, Technology Architecture Unification and Process Optimization. This assumes greater significance for the Insurance industry due to its rich information/data centricity and high-risk nature of the business.This paper discusses about post M&A scenario with a focus on three important IT Integration related challenges - Application Rationalization, IT Infrastructure Consolidation/Optimization and Employee/Customer Integration of the combined company.

Firstly, this paper provides an overview on how to plan and achieve IT Application Rationalization, right from collecting/preparing application inventory through a plan for transformation of the same. Secondly, it also brings in key aspects of interest in integration of IT infrastructure with related challenges and solutions to resolve the same. Lastly, it highlights the importance of Employee Integration and Customer Integration.

Download

Download full seminar papers At
http://www.enjineer.com/forum