Author: Doug Johnstone, Principal Consultant at Digital Pivot
Date: January 2025
The Journey to Post Merger Growth
I’ve spent my entire career working with professional services organisations, and over the past few years, I’ve watched a surge of acquisitions in IT services and consulting businesses. Private equity firms and investors have been snapping up companies, betting on growth, scale, and synergies. But the reality? More often than not, 1 + 1 doesn’t add up to 3. In fact, it quickly becomes less than 2.
over 70% of acquisitions fail to deliver the expected value
HBR
Instead of growth, many of these acquisitions lead to stagnation, loss of key people, valuable IP, cultural clashes, and customers slipping away. The promises of synergy and efficiency turn into cost-cutting exercises, and the business ends up in worse shape than before. Having seen this play out time and time again, I started digging deeper into why so many acquisitions fail to realise their potential.
This is the first instalment of five blogs exploring M&A challenges within the IT Services and Consulting industry, describing what I found and how senior leaders can take action to drive sustainable growth through authentic Post merger integration.
Introduction
In an era marked by continuous digital disruption, economic uncertainty, and AI-driven change, many IT service and consulting providers are merging or acquiring other firms to remain competitive. However, without a structured Post Merger Integration (PMI) approach, these organisations risk diluting the very potential that drove them to merge in the first place.
This article explains why PMI is an essential strategy in today’s fast-evolving digital landscape and how adopting a well-orchestrated integration plan ensures your newly formed entity remains competitive, profitable, and ready to address emerging market needs.
Growing Complexity in IT and Consulting Services Post-Merger
When two or more IT service providers or consulting organisations combine, they bring together multiple service portfolios, customer bases, and operational frameworks. This can lead to:
- Overlapping capabilities that create confusion around service ownership
- Disparate systems and technologies that hinder data sharing
- Multiple sales and marketing teams operating in silos
These factors add layers of complexity to day-to-day operations. A well-structured PMI program can simplify these complexities by creating a single, coherent strategy for sales, service delivery, and go-to-market (GTM) tactics.
Common Pain Points: Customer Confusion, Overlapping Offerings, and Internal Silos
1. Customer Confusion
Post-merger, customers often become unsure about who to contact, which service line to engage, and what new offerings are available. This uncertainty can lead to stalled or lost deals.
2. Overlapping Offerings
Different divisions may offer similar services under different brand identities, driving up operational costs while diluting brand impact.
3. Internal Silos
Mergers can unintentionally create or exacerbate organisational silos. Employees who were once part of separate entities may struggle to collaborate effectively, slowing innovation and reducing overall productivity.
By proactively addressing these challenges through a structured PMI process, companies can harmonise operations, eliminate confusion, and unlock additional revenue streams through cross-sell and upsell opportunities.
The Shift Towards Bundled, Integrated Services to Stand Out in the Market
Today’s competitive IT landscape, underpinned by AI technologies and rapidly evolving digital solutions, demands innovative service models that offer more than just standalone products. Customers want:
- Seamless end-to-end solutions that address multiple business needs
- Flexible, scalable offerings that adapt to a fast-changing market
- Long-term strategic partnerships with providers who understand their entire ecosystem
Through Post Merger Integration, businesses can combine the best capabilities of each entity into a unified portfolio. This not only differentiates your organisation from competitors but also enables broader, more robust offerings that appeal to evolving customer demands.
Benefits of Early PMI Adoption to Secure ROI
1. Faster Realisation of Synergies
Early adoption of a PMI strategy accelerates the unification of teams, processes, and technologies, ensuring that synergies are realised—and monetised—sooner.
2. Enhanced Cross-Sell and Upsell
With an integrated services catalogue, your sales teams can confidently present a broader range of solutions to existing and prospective clients, driving new revenue and strengthening customer relationships.
3. Improved Staff Engagement and Retention
Mergers often cause uncertainty among employees. A clear, structured integration plan helps reassure staff, promotes a collaborative culture, and increases retention of top talent.
4. Streamlined Go-to-Market Approach
A consolidated GTM strategy ensures consistent messaging and brand identity across all business units, reducing market confusion and boosting your organisation’s credibility.
Call to Action: Assess Your Current Post-Merger State
Before the complexities of overlapping services, siloed teams, and customer confusion take root, it’s vital to evaluate your current post-merger state.
- Conduct a Quick Internal Audit of Overlapping Services
- Identify immediate redundancies.
- Highlight areas ripe for synergy.
- Invite Senior Leaders to Start a Conversation
- Collaborate on creating a structured PMI roadmap.
- Explore how Digital Pivot’s Post Merger Integration Program can streamline processes, unify offerings, and boost revenue.
Next Steps
By recognising the importance of Post Merger Integration early and taking proactive steps to unify teams, tools, and service offerings, your organisation stands poised to thrive in a market shaped by AI disruption and a rapidly evolving digital landscape. If you’re ready to leverage the benefits of a well-planned PMI strategy, Digital Pivot is here to help.
Have questions about post-merger integration? Have a chat with our AI Pivot Agent — your expert guide to seamless integration and growth.
For more information, contact us
How to unlock Post Merger Growth:
- Why Post Merger Integration is Crucial in Today’s Rapidly Changing IT Landscape
- Streamlining Cross-Sell and Upsell: Unleashing New Revenue Opportunities
- Building a Unified Services Catalogue: The Key to Empowering Sales and Presales Teams
- Crafting an Integrated GTM Strategy: From Fragmented Practices to a Unified Vision
- Measuring Success Post Merger: Driving Continuous Improvement and Long-Term Growth