IT Checklist For Successful Mergers and Acquisitions

Aug 8, 2017 5:46:10 PM

A merger or acquisition presents several challenges to the work environment. Employees will be concerned about job retention and restructuring. A tremendous burden is put on upper management to ensure that the merger or acquisition is conducted appropriately for uninterrupted business operations and regulatory and shareholder interests.

In all the turmoil, the concerns of the IT department may be overlooked. A study by McKinsey[1] found that while up to 60% of M&A initiatives intended to capture synergies between two companies are strongly related to IT, many IT issues are not given full consideration during the due diligence and forward-planning stages of a merger or acquisition.

However, IT planning and management are critical to a successful, smooth changeover to a company restructuring due to M&A. A lack of IT planning could result in significant issues, and to make the most of a merger or acquisition, the technological strengths and weaknesses of both parties must be assessed and incorporated into forwarding planning.

Risk and disruption can be dramatically reduced with research, planning, and coordinated communications, and IT plays a vital role in these activities.


The IT team should gather all contracts, agreements, and commitments from outside vendors and service providers to establish transferability, assignment, and termination clauses. Limiting the exposure of all parties in the transition is important, as is maintaining good relationships with vendors. Fully understanding the company’s commitments to outside entities is an important first step.

The IT department should also assess any existing internal contracts or commitments made to employees in the technology department to include those commitments in the transition plan and to maintain transparent communications as much as possible.

Software Licensing

It is also important to address software licensing as part of the due diligence process.  When another firm acquires a company, the transfer of licenses may not be straightforward. This is a case-by-case basis depending on whether you are dealing with standalone firms or with a carve-out of a larger firm.

It’s important to understand the ownership and entitlements for all licensing to remain in compliance, and non-compliance can be costly in fees and penalties as well as in ongoing relationships with vendors and outside entities.


The network itself plays a major part in transition planning for the IT department.  The IT management team must determine whether the new entity that emerges after an M&A event will remain on separate networks, if the two networks will merge, or if a completely new network will be built. Each of these scenarios will have its own factors that must be considered to make an effective, low-risk, minimally disruptive transition plan.

Carrier Contracts and Agreements

The state of current carrier contracts and agreements, and whether or not they can be transferred, is another factor to be considered. If not, new contracts must be signed, and new circuits ordered, as lead time in ordering new circuits could cause a delay in full integration. A course of action must be decided upon as soon as possible to minimize any lag time or disruption that ordering new circuits may cause.


Messaging is incredibly important in today’s collaborative workforce. A recent study by McKinsey[2] found that using social technologies, including company messaging, could improve workforce productivity by 20-25%.

The IT team must determine which each party uses messaging service in the M&A event. Do the companies use on-premises messaging, or is messaging located in the cloud or elsewhere? Will the transition result in migrations to one standard or another or adopting a third-party messaging service?

Once the best path is determined, messaging systems should be included in an overall integration plan. A failure to transition smoothly to a new (or shared) messaging service could cause employee communication disruption and negatively affect customer service.

Other Tools

An IT department must pay attention to requirements, including email archiving and mail forwarding services, to protect those business services and minimize interruption of vital services. The IT group is also often in charge of telephony, VOIP, and A/V systems, so documenting equipment and evaluating the interoperability of systems is vital to managing workflow and employee productivity.


It is imperative to determine how the new company or companies will manage domains, as the primary domain is a company’s face to the world. An M&A event causes turmoil, leading to uncertainty for employees and customers alike. A cohesive message, sent by a well-planned domain change if required, will help to maintain communication with internal and external customers and ease concerns during a time of change.

The IT department should work with senior executives to determine the correct domain path. Will a new domain be required? Will the two companies be merged into a single domain, or will they maintain a separate presence? The complexity of resolving domain issues depends largely upon the level of integration each entity had with the prior domain and should be resolved and a plan put in place as soon as possible.


Working with the legal and compliance departments of all parties, the IT department should determine whether there are any government or industry regulations that need to be addressed during the transition. The team should work together to decide how to manage regulatory issues moving forward.

This is also a good time to address a Transition Services Agreement (TSA), as well as determine whether any deadlines or milestones should be factored into the integration plans.

Infrastructure Management

Finally, the IT department should take stock of how both parties currently manage infrastructure and how it can either be integrated or outsourced to provide a seamless changeover for all entities. Considerations include whether the infrastructure is an area of expertise at either company or if the infrastructure is outsourced. A detailed conversation should include whether it makes practical and financial sense to maintain infrastructure internally or if outsourcing to a third-party with infrastructure expertise in IT support services is a better option. Once a course is determined, planning can begin.

In the event of a merger or acquisition, clear and transparent communications are key, including maintaining lines of communication with employees and customers. Proper planning and due diligence that incorporates the concerns and activities of the IT department can go a long way toward avoiding business disruption and confusion.

Making a checklist and managing it with proper communications along the way can provide a great benefit in what can be an unsettling time for employees, customers, vendors, and associated parties.





  1. “Understanding the Strategic Value of IT in M&A”
  2. “The Social Economy: Unlocking Value and Productivity through Social Technologies,”