The secret to a successful RIM merger or acquisition: records and information managers play a critical role in supporting effective business processes within a merged organization.

• Author: Honore, Roselyn A.
• Position: Business Matters

At the Core

This article

* defines RIM expectations and goals during the merger and acquisition process

* explains the value of a merger plan

* discusses RIM professionals' role during the pre-merger, merger, and post-merger stages

Analysts estimate that at least 30 percent of the world's top organizations currently are considering a merger or acquisition. Even governments are not exempt. The U.S. Homeland Security Department, for example, represents the largest reorganization of federal agencies ever attempted. Although corporate merger and acquisition activity has slowed over the past two years, many companies are setting aside resources on the premise that there will be many takeover candidates available at bargain-basement prices when the world economy turns around.

Mergers and acquisitions are not Risk-free undertakings. More than half of the mergers in the past five years that looked financially and strategically sound on paper failed to meet shareholder expectations for value and earnings potential within the first 18 months of the merger announcement. The most frequently cited pitfalls include

* inability to realize projected economies of scale

* failure to integrate people, processes, and systems into a cohesive new entity

* poor or non-existent implementation of strategies for capturing, integrating, and/or retaining assets

The records and information management (RIM) integration issues associated with a merger are major contributors to the ultimate success or failure of mergers and acquisitions. More importantly, RIM plays a critical role in determining how effectively the merged organization is able to integrate information and skills while continuing to deliver products and services to internal and external customers.

The earlier RIM is involved, the better. Records and information managers should present executive management with a strong business case for involvement in the earliest phase of the merger and acquisition life cycle. The key is to demonstrate the ability not just to merge libraries, records centers, and archives, but also to develop RIM as a more effective and financially viable piece of the organization. Early involvement is essential to set realistic expectations and, more importantly, to define the strategic role of RIM in supporting effective business processes within the new organization.

In addition to unrealistic and often simplistic assumptions regarding cost cuts, many records and information managers face intense time constraints, as well as explicit directives to integrate complex RIM functions with no interruption in service quality or performance. Put simply, the expectations are clear for records and information managers involved in a merger: integrate two massive, complex, and disparate RIM programs; make the integration transparent to internal and external customers; and make sure the process is cost-efficient.

Phases of a Merger

The initial phase of a merger is the concept and analysis phase, which is typically carried out at the highest levels of the corporate structure. Unfortunately, RIM executives may not have representation at this level. This is followed by the due diligence phase. Shrouded in secrecy, confidentiality, or protection issues, this phase is generally the purview of accountants, bankers, auditors, or outside consultants. RIM is rarely considered strategic enough to influence the value matrix that either validates or negates a merger and acquisition deal.

A critical interlude in the merger and acquisition process occurs between the due diligence and transition phases. During this period, shareholders and government regulators review the proposed merger to determine its validity, a process that can last from weeks to years, depending on the complexity of the proposed merger. Although the transitioning period typically prohibits organizations from conducting detailed discussions on operational structures, informal communications often occur. Many organizations take advantage of this opportunity to exchange high level information and build a foundation for a more thorough plan of action once shareholders and regulators have blessed the deal.

RIM departments typically enter the merger and acquisition process during the transition/integration phase. Unfortunately, this may be the first time in the process that a RIM professional has seen...