How to SAFe Agile to Benefit M&A Integration
By: Marsha Lewis
Tags: Mergers And Acquisitions, Software, Agile, Finance, Integration

By Anna Pinnes and Kison Patel

Introduction:

Our experiences suggest the larger the company, the more siloed the integration is. This is just one incentive to use Agile for integration practices. Now imagine you have multiple newly acquired companies that need to be integrated. Here again, Agile can be most helpful as Agile allows you to tackle the backlog in an efficient and cost-effective manner. SAFe Agile is specifically useful for integrating multiple companies at one time because it is “the world’s leading framework for scaling Agile” across enterprises.

What is SAFe?

SAFe (scaled Agile framework) is a framework for businesses that focuses on navigating “transformation challenges” in ways that allow for improved quality, efficiency, productivity, and employee satisfaction. More specifically, it is based on the following five competencies:

1. Team and Technical Agility

Teams are responsible for performing and delivering work of a very high quality and value. With this in mind, the teams have two main traits: team agility and technical agility. In terms of team agility, the teams should be small and cross functional. In addition, they must understand their roles and how their specific roles relate to the larger whole.

Teams are rallied around a common goal. Technical agility refers to the team members possessing the skills needed to create strong solutions and outcomes. The teams must also work quickly; therefore, rather than testing and identifying problems at the end of a task, teams test early and often. The overriding idea here is teams want to be sure new changes do not introduce new problems -this concept perfectly applies to M&A since potential risks and loopholes should be identified and addressed early.

2. DevOps and Release On Demand

This competency revolves around the idea that DevOps helps to establish a “continuous delivery pipeline.” The notion of the pipeline means that the business should be able to produce and release something of value at anytime. Exploration, integration, and deployment should be happening continuously.

3. Business Solutions and Lean Systems Engineering

Business solutions and team systems engineering are based upon 9 Lean-Agile principles. These principles ultimately allow for products of higher value to be produced more efficiently. The principles include:

Take an economic view

Apply systems thinking

Assume variability; preserve option

Build incrementally with fast, integrated learning cycles

Base milestones on objective evaluation of working systems

Visualize and limit WIP, reduce batch sizes, and manage queue length

Apply cadence, synchronize the cross-domain planning

Unlock the intrinsic motivation of knowledge workers

Decentralize decision making

These principles help provide a basis for coordinating large teams and making them efficient and productive.

4. Lean Portfolio Management

Here lean practitioners and leaders are looking to marshal strategy and execution through lean methods related to operations, funding, and authority. Lean portfolio management is a better fit than traditional portfolio management methods for the global economy and digital age — both of which contain high levels of uncertainty.

There are three collaborations that must take place in order to fully achieve lean portfolio management flow. These collaborations are: strategy and investment funding, Agile portfolio operations, and Lean governance. With these collaborations, stakeholders are brought together and can get on the same page.

5. Lean Agile Leaderships

The role of a SAFe leader is to not only be extremely knowledgeable of SAFe’s lean agile mindset and methods, but also to model its thinking and behaviors. In fact, the team’s ability to adopt and implement SAFe ultimately falls back on the leader.

However, once this mindset and its methods are adopted, the work does not end. Rather, the leader must maintain the proactive process of looking to eliminate delays by identifying and creating ways to become more efficient. The journey never truly ends, which in turn, creates a very energized and motivated environment.

How to use SAFe to Integrate Multiple Companies at Once

The practitioners we spoke with praised the use of SAFe for a specific set of circumstances: when multiple legacy companies need to be integrated at once.

Here’s how they recommend using SAFe for this situation:

Develop committees and set up workstreams — in a unique way: First, develop your key committees: steering committee, operating committee, and integration management office. Then set up workstreams, but instead of using traditional business functions (i.e. “marketing”), divide these workstreams into process areas (i.e. “market to lead,” “lead to quote,” “quote to cash”). By focusing on process areas versus traditional business functions, you will have established the verticals that are accountable between all the acquisitions being integrated. It is important to note the above groups combine individuals from both the target companies and the corporate acquiring company.

Create and work through the backlog: Next, after the above groups collect their requirements and gap identification, they work together to create a backlog model, highest priority to lowest priority, focused on items to be migrated. This step helps make the approach more applicable, but also more Agile. For the backlog, tools such as DealRoom and Kanban can be very helpful.

Final Tips For Best Results, Be Sure To…

While the above development of verticals and backlogs should allow for successful workflows for the simultaneous integration of multiple companies, there are a few additional key ideas to assure success that our practitioners left us with:

Make sure people know about Agile — While the individuals involved do not need to be Agile experts, the more they know about and understand the principles and benefits of Agile, the better the workflow. Individuals also need to understand the rationale behind moving toward SAFe Agile, and it is the leader’s responsibility to clearly articulate this rationale and its corresponding goals.

Clearly define the scope -Simply put, be sure what is in/out of scope is established and clearly communicated to all committees and workstreams.

Align on a set of guiding principles and desired outcomes — The core team should establish a set of integration principles that will help direct the actions of the integration teams.

Create an end-to-end flow — This should be mapped out for all companies. More specifically, flow is one of the pillars of “The SAFe House of Lean.” In order to create value, a continuous flow needs to be established. A focus on flow ultimately helps avoid roadblocks and potential delays by identifying and dealing with them earlier in the process.

‍Conclusion:

Simultaneously integrating multiple legacy companies poses unique challenges for an acquiring company. These challenges are best addressed using SAFe disciplines because they offer concrete frameworks to assure a successful and cost effective integration. Finally, SAFe Agile boasts up to 50% increased employee engagement and 25%-75% increased productivity — two key factors of successful M&A practices.

Useful Links:

Agile M&A

M&A Integration

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