Identifying Duplicate Systems and Eliminating Wastage in M&A through Business Capability Modelling

Background

A major organisation had recently undergone a merger and acquisition (M&A) process, bringing together two large organisationes with distinct operational systems and structures. While the merger presented significant growth opportunities, it also introduced complexity, particularly around integrating systems and streamlining operations. Initial reviews indicated that there could be substantial overlap between the two companies’ systems, processes, and resources, leading to unnecessary costs and operational inefficiencies.

Challenge

The merged organisation faced the following critical challenges:

Duplicate systems: Both companies brought their own IT systems, platforms, and tools, many of which served similar purposes. This redundancy led to inefficiencies and inflated operational costs.

Lack of visibility into overlapping capabilities: Leadership struggled to gain a clear understanding of where duplication existed and which systems or processes could be consolidated.

Wastage: Millions of dollars were being spent maintaining redundant systems and services that added no additional value to the combined organisation.

Need for integration: The organisation required a structured approach to integrate the two companies’ capabilities and systems, eliminating waste while preserving the key strengths of both entities.

A Business Capability Model (BCM) was used to identify duplicate systems, streamline operations, and eliminate wasteful expenditure.

Solution

The BCM provided the structure needed to map out and evaluate the capabilities of both companies post-merger, leading to the identification of inefficiencies and the development of a consolidation strategy. Key steps included:

Mapping the combined capabilities: The first step involved mapping the full spectrum of capabilities from both companies. This allowed the organisation to visualise where capabilities overlapped and which systems supported these functions.

Identification of duplicate systems: By comparing the systems that supported overlapping capabilities, the BCM highlighted duplicate platforms, software, and services that were redundant across the merged organisation. This provided a clear view of where systems performed similar tasks, with no additional value.

Analysis of system performance: Beyond identifying duplication, the performance of overlapping systems was evaluated to determine which systems offered the best functionality, security, and scalability for the combined organisation.

Development of a consolidation plan: Once the duplicate systems were identified, a strategic plan was developed to retire unnecessary systems and consolidate operations into the most effective platforms. This process reduced the complexity of the IT landscape and cut ongoing operational costs.

Realisation of cost savings: By eliminating unnecessary systems and streamlining resources, the organisation was able to unlock millions of dollars in cost savings, which could then be reinvested into more strategic initiatives.

Outcomes

The application of the BCM during the M&A process delivered significant operational and financial benefits:

Elimination of duplicate systems: The BCM provided a clear framework for identifying and removing redundant systems, significantly simplifying the organisation’s IT infrastructure.

Cost savings: The consolidation of systems and elimination of wastage resulted in millions of dollars in cost savings, reducing operational overheads and freeing up resources for future investment.

Improved efficiency: Streamlined systems and processes enhanced operational efficiency, allowing the organisation to focus on delivering value rather than managing unnecessary complexity.

Informed decision-making: The BCM gave leadership the tools to make informed decisions about which systems to retain, retire, or replace, ensuring that future investments aligned with the organisation’s strategic goals.

Stronger post-merger integration: The ability to visualise and assess the combined organisation’s capabilities allowed for a smoother integration process, preserving key strengths while eliminating inefficiencies.