As the oil price remains depressed, many are predicting a flurry of mergers and takeovers in the sector. Smaller companies suddenly find their costs and debts are overbearing, the product of cash flow challenges, while larger operators recognise the chance to cut costs and potentially acquire long-term assets, at knock-down prices. As a result, mergers and acquisitions look set to reshape the competitive landscape.
Whether you’re part of the acquirer or the acquired, the additional workload placed on IT teams to ensure a harmonious marriage of two disparate IT estates, should not be underestimated. Having played an active role working alongside several organisations facing these circumstances, here are our tips for anyone tasked with ensuring a successful result.
1. You can’t eat an elephant whole
In the early days, you’ll be focussed almost exclusively on short-term requirements, but don’t do this at the expense of a long-term vision. You’ll need a strategy for how you are going to integrate the different sets of systems for the good of the new combined company. Tackling this in phases will ensure you tackle the myriad of technologies and infrastructures in play. Be mindful, there is no universal solution to this, as every situation is different.
2. Avoid double-vision
By their nature, mergers and acquisitions bring duplication of resources, systems and personnel. Whilst there is a period of time where duplication may be tolerable, no company wants to be doing this indefinitely. Your plan therefore needs to consider negotiating a path through this duplication whilst rationalising the technology and quite possibly the people at your disposal. Critical to this will be understanding refresh cycles, utilisation and determining preferences for standardisation that will need to take place.
3. Support the VIP’s
In the early days of any acquisition or merger you’ll be responsible for ensuring the crack team of specialists from Finance, Operations, HR and others who are tasked with bringing the two companies together are enabled to traverse IT systems belonging to both companies. Looking to helpful technologies like Citrix will make this quick to do and simple to manage, even if only for a short time.
4. Many hands make light work
The chances are you might not actually have the personnel capacity to deliver what’s required and fulfil on your strategy, especially if the coming together means delivery or support expertise in new regions around the globe. Make sure you know the skills at your disposal and make sure you have the means to plug the gaps that exist in knowledge or resource to ensure the integration follows your plan.
5. Look to the clouds
When the two businesses come together there will be vast unpredictability. As such, the cloud has the potential to play an instrumental role in providing any new infrastructure capacity that may be required. Think of it as a bridging point – all of the burst capacity you may need, available on-tap, as you need it. Even when both companies are of a similar size the combined infrastructure frequently does not have the capacity to meet the collective demand. Cloud may not be the answer in the long-term, but, do not discount it as a powerful interim measure.
6. Don’t forget the drillers
These people are often the forgotten users post-merger or acquisition and need to be considered in your plans just like everyone else. Ensuring corporate connections are maintained and indeed properly integrated into the new combined environment is essential. With both companies potentially running multiple drilling campaigns at any moment, there may also be scope to rationalise inbound and outbound connectivity at well sites, to both improve services for these personnel and deliver valuable economies of scale.
In light of the merger and acquisition activity going on in upstream oil and gas, ISN has developed an approach to support organisations going through these changes. This is based on our experience working in the industry and support we have offered IT teams in other companies tasked with integration following a merger or acquisition. We bring together all of the strategic input and technical capacity you will need. Through a master audit of sites, users, key applications, technologies employed, timelines and overriding objectives we can help build you a strategy and then supply as much of the expertise necessary in delivering it.
To learn more or to speak to one of our experts, please get in touch.