In today’s fast-paced business environment, mergers and acquisitions (M&A) have become common strategies for companies to expand their market share, achieve synergies, and drive growth.
M&A transactions can be complex and challenging, requiring careful planning and execution to ensure success. In this blog post, we will explore some key reasons companies consider taking these actions, why the M&A deals fail, and how streamlining mergers and acquisitions with MuleSoft composer automation would help them.
Why do companies consider Mergers and Acquisitions?
Companies consider M&A for a variety of reasons, including:
- Synergy: M&As can create synergies that enable companies to achieve greater efficiencies, cost savings, and improved competitiveness in the marketplace.
- Diversification: M&As can help companies diversify their product or service offerings, customer base, or geographic presence, which can reduce risk and increase revenue streams.
- Market dominance: M&As can enable companies to increase their market share, strengthen their competitive position, and gain a strategic advantage over their rivals.
- Talent acquisition: M&As can also be used to acquire talented employees or skilled personnel from another company, which can help the acquiring company expand and grow.
- Financial benefits: M&As can also provide financial benefits, such as increased revenue, cost savings, and tax benefits.
- Entry into new markets: M&As can provide companies with a quick and efficient way to enter new markets, expand their customer base, and increase their presence in a new region.
What is the success rate of M&A deals?
The success rate of M&A deals can vary widely depending on factors such as industry, size of the companies involved, the strategic rationale for the deal, and the execution of the integration process. However, it is generally accepted that M&A success rates are relatively low.
According to various studies, the success rate of M&A deals can range from 50% to 80%. A study by McKinsey & Company found that 70% of M&A deals failed to deliver the expected value, while a Harvard Business Review study found that the failure rate of M&A deals was between 70% and 90%.
The reasons for M&A failures can be numerous, including cultural clashes between the companies, overvaluation of the target company, poor integration planning and execution, and failure to achieve anticipated cost savings and synergies. Around 28% of deals failed because of integration gaps that needed to be appropriately considered.
This is a huge challenge to solve.
How could automation via MuleSoft Composer help?
Automating the M&A processes can provide several benefits to a company, including increased efficiency, improved accuracy, enhanced transparency, cost savings, and better decision-making.
MuleSoft Composer is our chosen solution because it is a no-code integration tool and can be used by Administrators or Business Analysts without help from developers to make integrations for their business quickly.
As an example of an M&A process that could be automated, we will look at how MuleSoft Composer could be used to onboard employees from a business that is being acquired into the acquiring organisation.
As shown below on the High-level diagram, the MuleSoft lightweight product can integrate the data from Human Capital Management (HCM) with different downstream applications, such as Salesforce, Jira, Slack, Google Calendar, and, regarding Devoteam’s unique circumstances, the HTTP endpoint that simulates the OpenAir system for timesheet management.
In the Employee creation use case, the employee data from the merged company should be uploaded to HCM, in our case Workday, and checked by a human. Once the accuracy of the data is confirmed, the MuleSoft Composer flow is triggered, and the automated process begins.
The MuleSoft Composer retrieves the data about the new employee and creates a new user on Salesforce, if appropriate (e.g. the employee works in the sales department). Creating a new employee also triggers the flow to create 2 tickets on the Jira board.
The first ticket is for creating a Jira account for a new user that the Jira admin will pick up. The second ticket is for provisioning the laptop for the new employee and will be assigned to System Administrator. The picture below shows how those tickets will look on the Jira board.
Creating a new employee in Workday triggers the third flow responsible for adding a new employee on the OpenAir API simulator.
The fourth flow that is triggered by the same action on Workday will automatically add a meeting in Google Calendar with the subject: “Initial manager catch-up” for the new employee with their manager as shown below.
The second use case our team covered is named Employee updation. Once the personal information of already existing employees changes in Workday, 3 flows get executed.
- MuleSoft Composer gets triggered by the update on Workday and sends a message on Slack with a notification about the change of personal information to the employee manager. Refer to the screenshot below:
- MuleSoft Composer gets triggered by the update on Workday and executes the change on Salesforce on the specific employee.
- MuleSoft Composer gets triggered by the update on Workday and updates the user on OpenAir accordingly.
Whilst there is a cost and development time to streamlining mergers and acquisitions with MuleSoft composer automations. Implementing an integrated solution such as that used in the example of this blog provides repeated benefits in future mergers and when onboarding any new employees by:
- speeding up the process
- reusing common, repeatable, compliant process steps
- ensuring consistency in data exchanged between applications.
- and thus removing manual tasks and their associated human errors
The Solution is agile enough to react to changes in the target applications, regulatory requirements, and future enhancements based on user experience improvements. All this helps improve the new employee engagement experience to energise them for the new organisation.
If automation with MuleSoft composer is something you want to explore for your organisation or you want to learn how Devoteam can help you implement solutions. Please do not hesitate to contact us.