Find out how an enterprise resource planning solution can help you maximise profits following new business acquisition.
Mergers and acquisitions are a common way for large Professional Services businesses to grow, but organising your company’s finances and processes post-merger can be difficult. You need to make sure you have full visibility of your existing and newly acquired business in order to stay efficient and remain profitable. Growing businesses need a scalable infrastructure. Post-merger could be the perfect time to reassess your IT integration to ensure it is still fit for purpose. The best place to start is your enterprise resource planning solution as it should give you a clear picture of the overall business.
Finances can break as well as make
Before we go any further, let’s accept that mergers don’t always work out. Earlier this year, French communications giant Publicis and American marketing and corporate communications company Omnicom, abandoned what had looked like one of the biggest mergers in their market, a cancellation attributable, at least in part, to differences over tax. What was notable was the publicity afterwards, with Twitter going into meltdown. Clearly, incompatible financials can drag a merger down.
A better fitting business solution
Ideally, what’s required is better efficiency, often derived from analytics sourced from a project-based enterprise resource planning solution. An example of better efficiency is evidenced in COWI, a global consulting engineering firm that has grown through acquisition.
In 2010, the company had multiple IT systems and multiple processes. In order to achieve smoother processes, COWI reviewed their incumbent system which only supported their back-office processes. They needed a solution that was specific to them as a Professional Services firm. Eventually, they selected a solution - Deltek Maconomy - which combines resource management, finance management and project management on the same system. The technology gave COWI the full visibility they needed to align their processes and improve where necessary - particularly in invoice scanning and financial management.
On a more global scale, Deltek Maconomy now gives COWI a complete overview of which resources are applied to which process at any given time and how they are performing.
“The business value is that we are able to give much sharper business proposals, leading to winning a lot of contracts.” - Claus Hagen Nielsen, CIO & SVP, COWI.
The implication is clear. With a single, project-based view of every piece of your business, it is possible to drill down and find exactly what’s working and performing for your company and what isn’t. When a company is settling down post acquisition, it is more important than ever to understand these metrics.
Choosing the right system
The technology in place is vital to a growing company as you need to have complete visibility of all projects and resources in order to grow in a profitable way.
The conclusion is relatively simple. Once one company has merged with another, the first priority for the financial department has to be to ensure the two are financially compatible. Differing billing methods, for example, can be deal breakers. As a company develops following a merger, it becomes vital to make sure the new company behaves as one entity and can track every project in the same way. With the intense need for complete transparency across all areas of the new-look business, a project-based enterprise resource planning solution, is an indispensable component.
- Agency Workflow
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