The competitive landscape within AEC often leads firms to grow through mergers and acquisitions (M&A). However, this can bring unique data-management obstacles. Figuring out your data-management strategy is crucial for your business – now and in future stages of growth. 

As Unanet’s latest AEC Inspire Report  details, there is a direct relationship between profit, win rates, talent-retention (e.g. growth) and the tech-forward foundation that drives it.

In this concise handbook, I’ll categorize the various data management challenges you may face during the M&A process and how to best tackle them to ensure a smooth and effective transition. 

Consolidation
Upon merger or acquisition, leaders face the critical decision of either consolidating data and systems or maintaining them separately. 

This isn’t an easy question to answer – the right solution depends on your specific circumstances. 

Opting for consolidation promises increased efficiencies and deeper insights into business operations. On the other hand, keeping systems separate might induce operational inefficiencies and pose reporting complications.

If you are considering your first M&A or you’ve experienced several, here are a few tips when it comes to business systems.

•    Ensure your combined IT teams have the capacity to manage all existing systems. If you already have an established infrastructure, and plan to move the acquired company onto it, equip your teams with the resources they need for air-tight onboarding.
•    Integrate your business applications. Whether using existing applications or evaluating your soon-to-be-acquired systems, do these systems fit neatly within your existing tech stack? If not, consolidating to an integrated ecosystem could be to your benefit.
•    Be mobile ready. Ensure your business applications are enabled for mobile or have mobile apps available.

Setting up an ecosystem that allows you to build repeatable onboarding and business processes will yield exponential return.

The key is to consult the impacted parties on all sides before moving forward with a final decision. Once a decision is made, communicate it clearly and outline any new processes going forward. 

Accounting 
Accounting policy compatibility is another aspect that requires careful consideration. It is crucial to review the digital infrastructure of the acquired firm for possible opportunities to streamline business operations. 

Incorporating a top-tier Enterprise Resource Planning (ERP) system into your data management strategy can offer significant advantages. An ERP system provides centralized analytics and real-time business intelligence, facilitating informed decision-making.

Fundamental accounting questions to consider include:

•    Fiscal year. Does the company you are acquiring run on the same fiscal year – and what are the hurdles to bringing their accounting system into parity with your current system?
•    Chart of accounts. Will the acquired company continue to operate on its existing chart of accounts? This is getting a bit in the weeds but can be paramount from a reporting perspective.
•    Reporting. What are your reporting requirements? Will you need to run consolidated financial statements, etc.? The way you want to measure success has a massive impact on how you structure your systems and account for the work being done within those systems.
•    Cross-charging. How will you structure your organization from a project perspective? Will employees of the acquired company work on projects owned by your existing firm? If so, what will be the impact on your business processes like time, expense and billing? Regardless, you will want to ensure your environment has the right controls in place to make your business processes risk-and-error free.

Redundancy
As alluded to above, M&A brings with it several redundancies: business systems, accounting structures and business processes to name a few. Be sure to conduct a thorough evaluation prior to closing. During your evaluation, document known redundancies and create a plan to address them. 

Also, don’t be afraid to learn and mature your business processes with your findings from the firm you are acquiring. Doing so will minimize disruptions and learning curves linked to acquisition and aid in the conversation about data management and system consolidation. 

Data Migration
Part of any system consolidation and onboarding will be decisions on how, when, and where your data should move. Data migration also needs to be addressed during M&A. Adopting a comprehensive data migration strategy ensures that the transition of essential information is smooth and secure. 

Your firm will want to take into account the potential impacts of moving large volumes of data to maintain compliance with relevant industry regulations. With the right processes in place, firms can make sure that high-quality and up-to-date information is readily available for decision-making. 

Resources
Lastly, ensure that all employees have access to the necessary data resources during M&A. You’ll want to equip your staff with the tools they need to efficiently manage their data and projects. By providing employees with real-time access to the right information, A/E firms can ensure that operations run effortlessly and remain cost-effective during the process of merging or acquiring new firms. 

Overall, understanding the potential data challenges associated with M&A is key for successful growth in today's competitive A/E industry landscape. Some best practices include: 

•    Leveraging a comprehensive ERP system
•    Keeping your data organized
•    Clearly communicating your data management strategy
•    Providing employees with the real-time information they need to work smarter and faster

By taking the time to plan for potential data issues, firms can ensure that growth opportunities are maximized during mergers and acquisitions. 

By understanding the potential challenges of managing data in M&A processes, leaders can maximize their chances for success and ensure that their organizations remain competitive for years to come.