By Ellen Owens,
Director of Global M&A Integrations for Avnet 

In July, 2012, Avnet, Inc., a Fortune 500 company and one of the largest distributors of electronic components and computer products with global headquarters in Phoenix, Arizona, hired me to assist in the research, design, and deployment of a disciplined and standardized global M&A and Integration process.

A seasoned M&A professional may have considered the task of documenting the steps of integration to be a piece of cake, much in the way a professional baker would consider the steps of baking a cake. Since I came through the doors of Avnet with no formal M&A experience, it was a true challenge, and one that I was willing to take.  Ready for action, I used the skills, knowledge, and tools that I have acquired in my many years of working in non-profit management and community capacity building.  I started at the place I always do when faced with a multi-disciplinary process change.  Simply stated:  To begin with the end in mind.

My first task was to have a true understanding and vision of what the desired outcome would be from developing such a process.  What would it look like; who would be impacted; and, most importantly, what would change?  After interviewing stakeholders, integration leaders, and functional team members, I completed a benchmark study, reviewing documented best practices and other corporate M&A and Integration processes.  In March of 2013, a workshop was held for functional integration leaders to obtain consensus on the process map, revise functional milestones, and review integration tasks and timelines.  As a result, the M&A and Integration Process draft was finalized and prepared for executive review. 

In late April, the revised draft of the M&A Lifecycle, which included enhancements to deal selection and due diligence, was presented to Avnet leadership.  In the context of continuous quality improvement, their directive to launch the process globally starting July 1, 2013, was an endorsement of the collective work over the past year.

Comparatively, the key phases of the M&A process are not that unique from other documented processes, there are five characteristics that support the process, making it unique to the Avnet culture.

• Strengths-based Approach

After interviewing functional team members who had participated in numerous acquisitions and integrations, it became apparent that there were many internal best practices that were strengths of the current process.Those strengths served as a stable foundation from which to build the framework of a new and enhanced process.Building on strengths also serves as a source of familiarity for M&A teams and is a function of change management.

• Communication and Collaboration

Integration by definition is a process by which parts are unified to become whole or one unit.My experience in nonprofit work in the community taught me a very important lesson about getting organizations to work together toward a common goal. It is nearly impossible to accomplish the goal if there is not a formalized process that is built on a foundation of communication and collaboration.The revised M&A and Integration process is enrobed in communication including written strategic goals, face-to-face executive meetings, and technology enhanced status updates and reports.

• Outcomes Oriented

The M&A landscape has changed over time and acquisitive companies must adapt to the changing environment.While processes may change, it is essential that companies remain focused on their core business strategies and align the M&A strategy accordingly.Although it may be tempting to consider new and exciting opportunities, these should be considered as part of a company’s overall strategic direction and carefully planned and incubated before heavily investing in something that sounds like a good idea.Nonprofit organizations are often accused of “mission drift” meaning that they drift from their core mission and broaden their scope in an effort to attract more funding opportunities.While casting the net wide may seem like a good strategy at first, these companies also become spread thin and dilute the true value of their organizations.The same can be said for corporations who experience what I like to call “strategic blur.”

• Education and Training

As a part of change management, training and education on the revised process was developed for all levels of employees who work on acquisitions as well as integration.Skills-based and interactive training in a traditional live workshop establishes a culture of collaboration and communication as well as sets the expectations for the standards to which functional and business leaders will be held accountable.

• Evaluation

A well-designed sustainable program is not a linear process with a beginning and end; rather, it includes a cycle of evaluation and revision. The evaluation strategy should not be an afterthought but developed in conjunction with the process itself.The evaluation framework should measure how well the process addresses the desired outcomes stated.Evaluation criteria should be easily measureable and meaningful.For example, one of the desired outcomes of the revised M&A process is a reduction in the additional workload on functional team members.A closer look at the real problem would indicate that it is not simply a reduction in hours, but that a more transparent and open process leads to more efficiency and seamlessness, especially in a cross-functional process such as M&A and integration.To measure whether the process has addressed this desired outcome, a survey of functional team members to assess their PERCEPTION of workload should be used.

I have learned a lot over the last year about mergers, acquisitions, divestitures, and my fair share of accounting acronyms, but what has become clear is that regardless of the mechanics of the process, there is the human factor that encompasses the process.At Avnet, we recognize that people are core to the process.With regard to the process itself, well, it’s the icing on the cake.

Ellen Owens
Ellen Owens joined the Avnet team as the Director of Global M&A Integrations, in July of 2012 to develop a global standardized integration process.   Ellen developed a passion for bringing people and process together while working with coalitions and alliances of nonprofit organizations, with a focus on the availability of healthcare to rural and underserved populations through Arizona.   Ellen holds an undergraduate degree in nutrition from Ball State University and a Master’s degree in Educational Leadership from Northern Arizona University.

About Avnet
Avnet, Inc. (NYSE: AVT), a Fortune 500 company, is one of the largest distributors of electronic components, computer products and embedded technology serving customers globally. Avnet accelerates its partners' success by connecting the world's leading technology suppliers with a broad base of customers by providing cost-effective, value-added services and solutions. For the fiscal year ended June 29, 2013, Avnet generated revenue of $25.5 billion. For more information, visit www.avnet.com.