Strategic Integration: 10 Business-building Tips
Ten ways that companies can use integration and integration-related strategies to build business.
When Wells Fargo merged with Wachovia, the stats must have been overwhelming: 80 lines of business, 4,000 applications, 280,000 employees ... oh, and let us not forget the orders to avoid disrupting the 70 million banking customers as they integrated the two companies.
Now, it's three years later, and, impressively, the technology integration work is 80 to 90 percent complete, with customer accounts 25 percent merged.
How did they manage it? Christina Torode, news director for SearchCIO.com, recently got the scoop from Martin Davis, Wells Fargo & Co. executive vice president and head of the technology integration office, and Executive VP and CIO of Information Services Wayne Mekjian.
I found two revelations particularly interesting in this Q&A. First, when they evaluated which systems to keep and which to scuttle, they started with a few, simple business questions: What business functions do we really want? What bells and whistles? Having defined that, they backed into the technology decisions.
Frankly, I would think it'd be awfully tempting to say, "What's going to be simplest and cheapest to keep?" But their approach sounds smarter.
They also put some constraints on it by adopting a "Choose A or B but never C" mantra, which basically meant: Choose Wells Fargo's system or Wachovia's system, but never create a new system. Davis explained why:
The reason you do that is because you want to make sure you move into a stable platform. If you build a new model in the middle of integration, you'll run into some burn and bumps, and we didn't want to impact our customers.
That brings me to the second standout lesson in this Q&A: The leading priority for scheduling integration work came back to making the merger transparent to the customer. For instance, the banks knew customers would hear about the merger and immediately want to use ATMs at either bank without being charged an extra fee. So the day after the merger announcement, the ATM integration rolled out.
After customers, the major concern was business drivers - in particular, moving on mortgages so the banks could take advantage of the boom in mortgages. Only after those kinds of calls did the merger team focus on issues such as which conversions needed to be "big bang" and coordinated with other units, and which units could be converted individually.
The article doesn't mention when the second part of the interview will appear, but I would guess next week. Davis and Mekjian will discuss how to avoid integration pitfalls and how they handled change management - two very promising topics.
This isn't the first time Wells Fargo has shared integration lessons from its merger with Wachovia. Last year, IT Business Edge's Ann All interviewed George Tumas, who oversees Well Fargo's Internet Services Group, who shared the company's strategic map for integrating the bank's Web management. As I pointed out then, other companies could learn from the five smart steps Tumas' group used to ensure the integration went smoothly and improved customers' online experience.