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Case Study 3

Post-Acquisition Integration of a significant Food Business

In the Food Sector, a blue chip acquisition of a significant business including a factory based in regional Australia, and the licensing of a major brand.
To integrate the business including providing a mechanism for the purchaser to invoice product to customers including the major grocery chains in 10 weeks. Due to the short-timeframe, an agreement was negotiated with the vendor to continue to use their SAP system to manage the Sales & Operations Planning Process and the standard costing system at the factory. As a result, a process had to be defined and system modifications undertaken to facilitate the transfer of inventory from the vendor to the purchaser without recording a sale and purchase in the respective Enterprise Resource Planning (ERP) systems.
MAT&D were retained to project direct the integration utilising about 60 staff from both organisations across the Sales, Marketing, Finance, Manufacturing and Supply Chain functions. The governance process and structure had to be designed and implemented in the first week to ensure that the tight timelines and budget could be adhered to. A team of 4 co-ordinated the integration with two members from the vendor company including the Managing Director and Supply Chain Director, and two members representing the purchaser including Mark Musgrave (MAT&D) and a senior IT Manager. MAT&D were responsible for directing the project including progress reports and recommendations to the Steering Group consisting of the CEO, CFO, CIO and HR Director of the acquirer.
There was a significant cultural and change management stream to the project, since with the business being sold as a going concern, many employees had reservations, and staff in the acquiring organisation also had concerns for their roles. A comprehensive communication strategy was developed and rolled out with very regular face to face interactive staff meetings. Significant software modifications and Master Data changes were made to facilitate the correct treatment of financial reporting and inventory movements. From a customer perspective the integration was seamless with TUNs (product numbering and bar coding) being changed and invoicing from the purchaser commencing without a hitch at the transition date.