Risks, Dependencies and Mitigation Steps By Function

Transcription

1 Risks, Dependencies and Mitigation Steps By Function

2 Cross Team Dependencies: Operations 1 Team Dependency Teams Affected Status Op 1 Early approval of key lead roles & staffing so transition plans can be executed Process Review to identify critical Day 1 issues and prepare for merged volume of activity Systems and Process Reviews to identify critical Day 1 issues and prepare for merged volume of activity Work process review and sub-team recommendation for new org & transition HR/SC Legal IT & Finance Op 2 Members locations in office closures Op 2 In progress 2

3 Issues/Risks: Operation 2 Team Issues/Risks Mitigation Steps Status Op 2 Customer uncertainty Proactive customer communication plan Safety during transition period Retention of critical skills Information systems transition plan Inadequate communications Where specific functions will report Retaining designation to purchase system Unionizing employees Need a single contract for common vendors Day 1 safety communications and training plans TBD Work with IT to ensure systems requirements are included on IT Day 1 and Year 1 roadmap Review IMO Communication plan and confirm specific additional operational communication requirements Confirm in cost and structure recommendations TBD 3

4 Cross Team Dependencies: Operations 2 Team Dependency Teams Affected Status Op 2 Systems: transition schedules, skills retention, org structure Reporting, accounting, staffing System transition, policies, staffing Fee sourcing decisions, raw materials, geographic planning Contracts, policies IT Finance HR Procurement Legal 4

5 Issues/Risks: Operations 3 Team Issues/Risks Mitigation Steps Status Op 3 Tight timeline, limited information gathering leads to organizational / infrastructure decisions that lead to a less than optimal outcome Inconsistent communications to the stakeholders leading up to day one between the two companies Disruptions in the business due to systems issues Loss of key employees and contractors leading up to and during transition Inadequate resources by HR / Management on Day 1 Inability to process AP / AR Injuries due to confusing conditions Operating outside acquirer policies Retaliation by terminated employees Inability to conduct business - software / access issues Finalizing Org decisions Confirm any additional time & info requirements after initial Cost & Structure review meetings IMT Communication plan will ensure consistency from Team to Team Ensure IT, Finance, HR are aware of mission critical business continuity requirements Work with HR and/or accountable SC member to confirm employee retention needs Confirm Day 1 HR resourcing requirements with HR Team Leads Schedule dry run process and work reviews with IT & Finance pre-close Ensure Day 1 communication include reinforcement of safety values Confirm Day 1 change of control and policy mandatories with Legal and HR Address with Legal and HR Confirm Day 1 IT operating requirements TBD 5

6 Cross Team Dependencies: Operations 3 Team Dependency Teams Affected Status Op 3 Stakeholder Communications SC, Communications IT systems Day 1 Plan Employee Retention Plan Employee HR-related Q&As on Day 1 AP/AR Day 1 business continuity Day 1 Policy Adoption Employee Transition Plan IT Systems Day 1 Business Continuity Plan IT, Finance, HR HR HR IT, Finance Legal, HR Legal, HR IT 6

7 Issues/Risks: IT Team Issues/Risks Mitigation Steps Status IT Question: Relocation of office Direction shared at Integration Meeting Vendor costs for applications approval to share People -- attrition: Legacy knowledge of critical applications Day 1 Deliverables pick the have to haves vs. nice to haves Not having enough resources to do the IT work. We need to get resources identified and going now in some cases. We will need significant outside investment to get IT work done. Adequate change management, training, communication as we make system changes Question: Is Process Control in scope/out of scope OK Confirm any proactive retention candidates that are needed for a specified time post close to extract knowledge prior to separation Confirm any prioritization issues with IMO so any deselections can be vetted and restaged post close Confirm IMT support required to advance case for additional IT support Suggest where change mgmt. and training resources will be needed to address Day 1 and post close training requirements Provide more info/examples so we can address with IMO 7

8 Cross Team Dependencies: IT Team Dependency Teams Affected Status IT Change Management and communications with HR, Finance, and Newco Employee Retention Plan Target -> Relocation Plan Approval of IT Roadmap Business and Corporate Org Decisions Funding sources for IT Roadmap decisions HR, Finance, Communications HR, Communications HR SC, Corporate Affairs SC, Corporate Affairs SC, Corporate Affairs 8

9 Issues/Risks: Legal Team Issues/Risks Mitigation Steps Status Legal Not learning from business & functions with sufficient lead time where Legal team needs to assist with legal obligations/third-party-facing matters where contract change, notice, and actions are triggered on DAY 1. This issue also continues DAY 2 onward Inadequate resourcing to address commercial issues posed as we integrate third-party vendors (contract terminations, etc.) That plus operational demands and learning curve/transition issues put both integration execution and synergies at risk Adequate support for the combined scale of the businesses, especially the new to Acquirer separated business Internal Audit must be ready for Q1 work to support 10-Q filing Confirm all government regulations matters in advance with teams TBD Confirm if support is adequate during costs and structure review meetings TBD (potential resourcing issue?) 9

10 Cross Team Dependencies: Legal Team Dependency Teams Affected Status Legal Need quick input on office closure/relocation plans that might impact staffing options/decisions Need early/ongoing visibility into business and function integration plans that will require commercial or other legal support Work closely with leaders of businesses, including appropriate lead team membership Work with Tax on corporate structure/target entity name change plans & timing to address legal/contractual impacts IMO will communicate Office consolidation decisions coming out of Cost & Structure review meetings Team plans will be shared at weekly team meetings OK? IMO tabling legal entity decisions and timing with SC 10

11 Issues/Risks: HR Team Issues/Risks Mitigation Steps Status HR Retention of key employees Secure proactive retention candidates from teams Employee engagement Significant risk reduction if benefit plan and data conversion dates are planned for post closing Unionization threat Confirm Communication Plan addresses key Day 1 and post-close employee information needs and make sure organizational restructuring timing is communicated so employees know what to expect Confirm onboarding date Confirm any proactive steps required to preempt any organizing activities 11

12 Cross Team Dependencies: HR Team Dependency Teams Affected Status HR Peoplesoft set-up and HR integration is contingent upon the following being finalized: Company structure Business reporting structure Financial structure IT connectivity Unionization Mitigation Plan IMO, Finance, IT Company structure shared at SC meeting. Confirm outstanding business and financial structure decisions Confirm connectivity requirements and status with IT Operations 12

13 Issues/Risks: Finance Team Issues/Risks Mitigation Steps Status Finance Key employees not retained throughout long transition period Retention bonus plan Awaiting HR approval Financial, reporting and log settlement system consolidation does not occur in time to capture synergies Hire external IT resources and finance resources to develop, test & implement Awaiting detailed IT project plan Organization consolidation does not occur in time to capture synergies N/A, most synergies are dependent on system consolidation. See system issue. Combined budgeting, reporting and forecasting across two financial systems not effective Be prepared to address ineffectiveness from a technical or accuracy standpoint and ineffectiveness due to lack of training or adoption of standard reports TBD Gap in insurance coverages Add to workplan to resolve IT capacity and prioritization Awaiting detailed IT project plan Internal control / SEC compliance failures during transition Retain key employees, continue Target internal control monitoring Pending 13

14 Cross Team Dependencies: Finance Team Dependency Teams Affected Status Finance Retention bonus approvals HR Day 1 IT Roadmap HR / IT / Ops 1 / Ops 2 Business and Corp Org Decisions HR / IT / Ops 1 Management Reporting and Forecasting Requirements IT / Ops 1 / Ops 2 Insurance Coverage Plan PC Internal Control Monitoring Treasury / Risk Management Internal Audit 14

15 Issues/Risks: Corporate Team Issues/Risks Mitigation Steps Status Corporate Affairs Day 1 Launch getting comms right Record access, Job loss Need a crisis communication plan. Internal and external confusion about each function s charter, scope of work and authority. Talent retention through the integration process. Employee morale low due to uncertainty. Ensure Day 1 plan includes all Functional and Business specific communication requirements Proactively address via communication plan Develop stub plan for potential crisis Team charters reviewed Confirm retention needs with HR and accountable SC member Meeting the learning curve to fully understand the business fast enough to represent their interests. Policy alignment. Priority alignment. Include steps to address in integration plan Getting data on job functions from the org quickly enough to adequately analyze. Synergy decisions may eliminate functions which are valued by a business unit. We need to understand systems and the combined businesses well enough to optimize simplification and rationalization decisions. Work with HR leads Address issue during cost & structure reviews 15

16 Cross Team Dependencies: Corporate Team Dependency Teams Affected Status Corporate Affairs Ask for & intranet to be part of Day 1. Calibrate on system needs for data collection and other CA technical support needs. Support in org structure implementation. Understand large RIF impacts. Stay engaged in risk management for labor organization. Understand marketing/website support needs. Understand model to align support. Need to know if we plan to use Target model for business. Need to understand website needs for leases. Require support for synergy tracking. Legal plan. Business-Basic understanding of the business units: how they make money, how much, how the Acquirer and Target models differ and the implications, basic org structure, top 3 risks, top 3 opportunities. IT HR Operations Operations Finance Legal IMT 16