Companies that quickly integrate target systems into existing operations, and do so seamlessly, can see first year cost savings between 30 and 50 percent, according to research from business intelligence firm Cutting Edge Information.

The goal for any merging company is to ensure its systems function properly the day the newly combined company begins operations. Successful integrators involve IT teams early in the due diligence process to estimate integration costs.

“Accelerate M&A Success: Making Integration Work,” available at http://www.cuttingedgeinfo.com/reports/FL59_M&A.htm contains more than 250 metrics and features practices from more than 80 top integrators, including Pfizer, Hewlett Packard, Cisco, IBM, GE and Exxon-Mobil. One main reason mergers and acquisitions fail is poor IT integration execution, which is often a result of unrealistic upfront estimates. The earlier IT participates in pre-merger activities, the better these estimates will be.

“If IT estimates are off, companies will be in trouble with Wall Street,” says Elio Evangelista, senior analyst at Cutting Edge Information. “IT is critical and the businesses cannot consolidate workforces until they consolidate systems. The cost of carrying two workforces gets dragged along with the IT delay costs.”

The amount ultimately spent on integration typically exceeds management's estimates by a factor of four to eight. When IT is not part of the merger and acquisition negotiations, management can make some naïve assumptions.

“Mergers & Acquisitions: Executing Better Deals” showcases metrics and practices in the following areas:

* Corporate goals and needs that M&A can support
* Identifying prospective partners
* Smarter due diligence
* Closing the deal
* Maximizing cultural synergies and minimizing barriers
* Building internal buy-in and enthusiasm
* Technology integration
* Maintaining sales and marketing effectiveness

To view the online summary of this 138-page report http://www.cuttingedgeinfo.com/reports/FL59_M&A.htm For more information on this report or to learn about other research being conducted by Cutting Edge Information, contact Diana Borja at Diana_Borja@cuttingedgeinfo.com or 919-433-0219.

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