Critical IT Considerations During Mergers or Acquisitions
01.31.2019 | Verizon Partner Solutions
Authored by Sarah Lamothe
Combining two companies in a merger or acquisition is a complex process that includes intense detail and planning. As part of this process, M&A teams should evaluate their network infrastructure and identify opportunities to optimize IT. From evolving use cases and applications that require increased bandwidth to network resiliency, we’ve outlined some key considerations M&A teams should take into account.
IT Infrastructure
When going through a merger or acquisition, companies potentially face two very disparate networks that each connect to separate IT infrastructures through LAN and other business applications.
When evaluating these networks, it is important to consider things such as:
Thinking through these questions will help allow for a more seamless transition into a single unified company. As companies go through the M&A process, they need to conduct an inventory of IT needs and start to look at the network from an optimization standpoint.
Evaluating Bandwidth Needs
Once a company figures out IT structure, the applications they are going to be servicing on it and their embedded base of inventory, it is important to look at the utilization on those circuits to understand what the capacity is. Companies going through a merger or acquisition need to determine if they have excess bandwidth being procured, while also ensuring they have enough bandwidth to be able to grow with the company and needs of the business moving forward.
In addition to the synergies obtained by combining two companies, another benefit of a merger or acquisition is new combination of talent can help spawn more innovation and growth. If a company doesn’t have enough bandwidth for that growth and creativity to foster, it could end up slowing down the company’s ability to realize its vision, since it takes time to provision additional bandwidth moving forward.
For instance, a company may need 1G worth of service for a particular office space, but after a merger or acquisition, there could be a potential to grow that bandwidth exponentially. Having the capability of going with a 10G service and scaling upward through multiple Ethernet virtualization circuits (EVCs) can help to more quickly adapt to changing needs.
As we continue to progress as an industry and virtualization becomes more of a possibility for customers, that bandwidth growth can become an on-demand atmosphere where you can scale up as quickly as you need to for innovative products to come to life. With advances in network virtualization, we could work with an SD-WAN type of architecture to dial bandwidth up and down as needed.
In today’s technological business world, it is a balance between traditional WAN services and SD-WAN services. It is important to appropriately plan for the bandwidth, as well as the scale of that bandwidth.
Tips for Supporting Customers Amidst a Merger or Acquisition
List of Inventories
First, we take inventory of the companies’ circuit base, find out where they house their end users and understand the utilization of their data. Once this is determined, Verizon Partner Solutions provides recommendations that lay out the best path to growth and innovation.
Discover Utilization Rates
Next, we evaluate what the company’s fill rate is historically, and estimate how it will look in the future. Verizon Partner Solutions then suggests how to best fill the existing network-to-network interconnections (NNIs) and recommend strategies for keeping and optimizing the bandwidth that’s available.
Resiliency and Redundancy
When a company undergoing the M&A process is planning their network strategy, optimization and innovation is important, but it is also important to make sure they have resiliency and redundancy associated with the design, in the event a disaster ends up happening and a circuit goes down.
In order to provide diversity and survivability, it is recommended that companies use a provider that has the capability to diversely route services to different wire centers through different conduits, while keeping critical applications diversely routed from each other.
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