The Importance Of Automation For The Mergers And Acquisition Process

We are witnessing an unprecedented pace of technological innovation with the emergence of disruptive technologies and accelerated adoption of digitization. In this climate, a record amount of capital availability and investments triggered by IPOs and VC funding have caused mergers & acquisitions (M&A) activity in the US to reach record levels.

When two business entities come together in a merger, or one acquires the other, there is a rapid, inorganic expansion of product portfolios, immediate access to new technologies and new markets. That’s how M&A deals help companies achieve fast growth―build new capabilities, reshape their businesses and maintain or attain market leadership.

Every activity in the M&A process, from originating deals to valuing companies, through to negotiation, due diligence, and post-merger integration, is heavy on information search, sharing, documentation, data exchange or systems integration.

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Speed and ease of consolidation are key in the M&A process

The value from an M&A deal depends on how quickly and efficiently systems and processes are consolidated post-merger. You achieve cost and scale efficiencies when you leverage synergies to integrate data, systems, processes, and people from two entities.

Accelerate and streamline challenging activities in the consolidation phase

  • Data mapping & migration to a common platform: During the consolidation phase, the merging entities must strategically reduce the number of systems they use and migrate all data to a common platform. But mapping data from different systems and creating a new combined informational database is fraught with hurdles and requires expertise.
    DRS has extensive experience providing data migration services to ensure a seamless consolidation roadmap without any data loss or inconvenience to employees during the migration process. 
  • Data extraction: Sources of structured and unstructured data across the merging entities are diverse. Extracting data from custom sources, whether in physical or electronic formats, is a challenging task. At DRS, we use advanced data capture technologies to reliably capture information from structured and unstructured documents and forms while reducing costs. Intelligent data capture tools are much less labor-intensive than manual data entry.
  • Eliminating manual tasks: During the consolidation process, companies sometimes resort to manual data entry and tedious paper-based processes if a common or standard platform is not in place. Manual tasks are prone to human errors, and inaccuracies in data can lead to increased costs to rectify mistakes and even have negative consequences on management decisions based on inaccurate data. DRS offers automation solutions to manage data and documents to eliminate manual and paper-based processes.
  • Process optimization: During a merger, processes must be rationalized, and new streamlined processes must be adopted. Our business process automation experts work with your teams to optimize or reimagine operational processes and lay the foundation for improved work management in the newly merged enterprise.
  • Strategic consulting: Once systems are integrated, new processes and adopted, and data have been migrated, a complete review of the new functionality and procedures must be conducted to determine conversion readiness. We provide you with consulting support to gauge readiness and recommend solutions for any challenges you may face. The DRS consulting team consists of industry leaders with extensive experience who have transformed document management and data storage processes for organizations striving for efficiency and optimization. 

In a challenging consolidation scenario, companies need a technology partner like DRS Imaging to standardize data to a standard format and plan data migration and systems integrations to bring the two entities onto a common working platform. 

Automation in the mergers and acquisitions process

Mergers and acquisitions involve a large amount of paperwork, information gathering and analysis. From the initial steps of deal sourcing and pinpointing target companies to the tedious process of due diligence, many tasks lend themselves well to automation. Moreover, with advances in machine learning, even highly sophisticated decision-making processes can be automated to a certain extent.

With fast innovations in predictive analytics, natural language processing (NLP), machine learning (ML), and robotic process automation (RPA), we will soon see many of these M&A activities replaced by software. Automation relieves investors and their teams of manual or time-consuming tasks. As a result, they can spend more time on business-critical activities like mitigating M&A risks, solving teething problems, and planning post-merger integration. 

Here are some examples of how automation may help in the M&A process:

  • Deal sourcing or deal origination: Private equity firms or investors analyze large amounts of data to identify a target company for a lucrative M&A deal. Automated data management platforms with ML-based algorithms will help PE firms source higher volumes of deals and accurately identify the ones that may prove to be most lucrative. Learn more about the partnership between DRS and Hyperscience.
  • Due diligence: When you merge with another company or acquire a company, you want to know about various aspects of the business being sold or bought. The process involves search & retrieval of information, document sharing, and data analysis. Automated tools help reduce the time consumed in due diligence, share information seamlessly and analyze it accurately, minimizing the risk of deals with fraudulent companies. Learn more about digital transformation solutions from DRS.
  • Background checks: Background checks on business owners, senior management, and newly acquired employees are critical for risk mitigation and various types of compliances for the newly merged entity. Information gathering and sharing can be completed faster and easier with automated tools. In the future, we may even be able to conduct a profiling or behavioral analysis of important stakeholders to assess their suitability. 
  • Task management: Automated software can also help with administrative task management during the M&A process, such as scheduling, tracking project timelines, stakeholder collaboration, data migration, and systems integration.

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DRS & the Hyperscience platform support M&A processes with advanced automation

To compete in a dynamic, fast-paced environment, companies must adopt a value creation mindset to M&A strategy. Research by Gartner indicates that as M&A deals grow in value and volume, multiple trends are contributing to an increase in how long they take to complete. The average time to close a deal is 38 days after announcing the deal. Closing times have grown even longer for midsize and large deals, as complex deals require more time for due diligence. In the corporate world, time is money and the faster deals are closed, the better the value from the M&A deal. 

DRS delivers transformative solutions with high-value consulting and implementation services. In addition, our partnership with Hyperscience allows our clients to prepare for their exciting M&A opportunity.

Key highlights of the Hyperscience automation platform

  • Powered by industry-leading ML for scalable, enterprise-wide automation.
  • Convert your unstructured text into actionable data to drive faster, more reliable downstream processing.
  • Classify and extract data across complex, difficult-to-read documents, including handwritten forms, PDFs, images, emails, and more.
  • Integrates with your document processes and workflow systems to provide accurate, actionable data where you need it most.
  • Intelligently plugs into your document processes with out-of-the-box and customizable tasks, workflows, and connectors.
  • Drive greater automation and decision-making by integrating with other systems in your environment during document processing to leverage external data.
  • Gain actionable insights for optimizing workflows, making decisions, and improving performance.

Reach out to DRS for advanced automation solutions and task-based automation ranging from data extraction, migration, and enterprise-level business process management consulting services.

Ask us for details  about the Hyperscience Data Automation platform for ML-based enterprise automation solutions.