Duration of PMI
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I’ve seen PMI process that last for extensive period, with other being much concise. While I understand that the duration of PMI process would depend on case by case and magnitude of issues to be dealt with, what is your experience in general with the duration of intensive PMI task engagement (weekly calls, task team hours, etc.). I am asking since once these tasks start, there continues to arise further tasks which seems to make PMI process a never ending one… (though I am aware that setting a clear KPI to achieve certain level at certain time period should address this issue; but that also depends on the appetite of the one who leads the PMI…). Trying to understand what everyone’s experiences and advice would be.
Every deal is different from the other. Therefore, every PMI has its own rhythm. it might take months or even years, but usually it falls between 12 to 24 months.
I agree with other responses above, generally a PMI term of 12-24 months is typical, but can vary based on a number of factors.
I’ve been enjoying the element of portfolio acquisitions which by design plan for a learning period post acquisition. Setting key goals of understanding prior to mapping out all synergies, beyond what is captured in due diligence. This follows more of a continuous improvement approach, master the entity alone prior to integrating with others in the portfolio.
I have seen an PMI of years, actually still ongoing after 5 years because of different go-to-market approaches (direct sales with the target company versus indirect sales strategies with the buyer company). The buyer was well aware and planned for a long PMI – in fact multiple years. They had a clear vision of when certain synergies would happen and how important they are, or not. The target company was/is market leader in their product portfolio, thus there really was no need for an integration on the sales models. It has its disadvantages when it comes to scalability in other countries, but that was anticipated.
It’s just one example, but I hope it helps. These were 2 privately owned companies in the US.
In my experience, PMI can last from 12 months to 24 months depending on the scale, jurisdiction involved and type of business of the acquired company. Some PMI components can evolve to become something than can be dealt with under BAU. So clear and specific goals for PMI is important
Hi,
the duration of PMI on my experienced cases is linked to the existence or not of an earn-out and if I’m dealing with the integration of several entities, globally spread through several Nations. on those cases. it can extend itself to 28 /30 months. But the majority of the cases I’ve worked took about 12 to 18 months.For the most part, I’m aligned as well with 12 – 24 months depending on the specifics of the merger. Also, I would add that even once the target is functionally merged, there may be lingering longer term process that need to be monitored. Cultural differences need to be kept in mind and may take ongoing training for employees. Regional synergies may take longer to be fully discovered and optimized for example.
It depends on a lot of factors, size, ERP used in both company, CRM used, the type of merger as well if it a horizontal could be faster than vertical.
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