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© British Telecommunications plc 2007, All Rights Reserved

The Contents of this Document are confidential to British Telecommunications plc, all non
-
authorised use

is strictly prohibited

Analyst’s introduction to M&A integration in BT

David Furniss,

Vice President, M&A Integration Practice

Agenda


Background


the M&A landscape


Strategic rationale


BT recent transactions


Integration options


Network growth


Success from BT’s perspective


The Change Management challenge


M&A Integration Practice (M&AIP)


Systems / infrastructure alignment


Recent successes


Lessons learnt and continuous improvement


How are we doing !!

Background


the M&A landscape

“Buying is one thing, benefiting is another!”

Mergers and acquisitions are back with a vengeance. M&A activity in 2006 outstripped
even the deal volumes of the heady dotcom days with a global $3.44 trillion dollars

“Our latest observations are that 50.5% of

the mergers create value while the other
49.5% perform below their stock value

before the merger”

AT Kearney online July 2006

“..while organic growth gets better press, and is certainly
less fraught with blood, sweat and tears


not to mention
risk


M&A remains the fastest, most powerful tool a
company can use to change its competitive game.”




Business Week Oct 2006

55% of acquisitions fail to meet cost
-
saving targets



Accenture Executive Survey June, 2006


Value creation

Acquirers are optimistic about whether their deal was successful yet two
-
thirds of

deals fail to create value

93% believed they had created value

Perception

Neutral
3.5%
Reduced value
3.5%
Enhanced value
93%
Source:

KPMG survey 2005

Vs.

Source:

KPMG survey 2005

Yet 69% failed to enhance value

Reality

Neutral

43%

Reduced value

26%

Enhanced value

31%

A consistent strategy for BT Global Services

Build on existing corporate relationships

Grow global market share of our target customers

Use convergence to expand offering into networked IT services

Develop our traditional UK base

Drive for cost and capital efficiency

Meeting the

networked IT services requirements

of multi
-
site organisations

Strategic approach

Market attractiveness

Low

Direct
approach

Direct and
indirect
approach

Strong service delivery approach

Ability to execute

Medium

High

Low

Medium

High

Assess opportunities and invest for growth

in highest potential countries

Invest to ensure country becomes

major margin contributor in future

Optimise approach to market whilst monitoring

high growth countries for future investment

Seek to augment and leverage capabilities

to maximise margins

Leverage indirect channels to SME market

Focus on cost effective support for global delivery

Direct approach

Mainly direct
approach

Our strategic positioning around the world

North

America

Grow aggressively

organically and

inorganically

North

America

Strengthen commitment
to multi
-
site global
organisations

Latin

America

Continue aggressive
growth in core European
markets organically

and inorganically

Western

Europe

Strengthen commitment
to multi
-
site global
organisations

MEA

Accelerate growth in

selected geographies
organically and inorganically
(India, Japan, China, Korea)

Asia

Pac

Strengthen commitment

to multi
-
site global
organisations

Russia/

CEE

Global revenue grew 48% last year

Completed / Signed deals (1 / 2)

Global acquisition to build network presence

1,200 employees; completed 2005

Enhance presence in Italy

1,450 employees; completed 2005

Extend global financial services proposition

960 employees; completed 2005

CWC Espana

Provides additional capability in Spain

30 employees; completed 2005

Extends UK network integration capability

60 employees; completed 2005

Enhanced UK LAN & convergent capabilities

90 employees; completed 2005

Dinsa

Soluciones

Transformational outsource with

Spanish bank Banesto

Employees n/a; completed 2005

Key supplier on major UK NHS programme

30 employees; completed 2005

Builds IT services capability in Ireland

140 employees; completed 2005

Deutschland

Further cost synergies

60 employees; completed 2006

(JV)

Boosts offering to Japanese corporates

c.40 employees; completed 2006

Telexis Polska

Part of Atlanet, providing service in Poland

26 employees; completed 2006

Telexis Brazil

Part of Atlanet, providing service in Brazil

17 employees; completed 2006

Global security monitoring services

70 employees; completed 2006

BT Telecom India

Pvt Ltd JV

Joint venture entity for local operator licences

Employees n/a; completed 2006

Strengthens Italian presence and
relationship with Fiat

250 employees; completed 2006

Completed / Signed deals (2 / 2)

Consulting/ professional services expertise

900 employees; completed 2007

Acquisition of the 49% missing

shareholding held by P&T

10 employees; Completed 2006.

Luxembourg

Accelerates growth in India

200 employees; completed 2007

Builds capability and presence across

15 LATAM markets

700 employees; completed 2007

Strengthens network integration and
outsourcing skills, capability and customer
base in France

Announced Aug 2007; 1,350 employees,
due to complete in 2007.

Infrastructure Division


Completed on 7th September 2007.

8 employees

Turkey

Strengthens and consolidates BT’s hosting and
security capabilities in Italy within BT Italia

259 employees, completed 2007

Broadens and strengthens BT’s LAN IP
networking and IPT people skills, capability
and customer base in Benelux

225 employees, completed 2007

Strengthens BT’s network service capability
and customer base in France.

800 employees; due to complete in 2007

Growing the 21st century network globally

Biggest and broadest:

IP in 128 countries, extending to more than 160 by end of ’07

Rapid expansion: one new city every seven days


Richest:

Scaleable, flexible, manageable

Six CoS in the core enables end
-
to
-
end application prioritization and performance management


Highly resilient:

Increasing cities with dual PoPs from 12 to 28

Dual core network


fully diverse, fully replicated

Success from BT’s perspective


Delivered the integration
synergies/upsides in the Business Case
for each acquisition Ensure key
capabilities identified in the target are
retained and not “destroyed” by the
integration process


(BT demonstrates
continuous improvement)


We try not to make the same mistakes
twice. (We learn from and share internal
experience and external best practice
and evolve our approach based on the
application of that learning)

BT delivers shareholder value

Integration projects deliver
financial and non
-
financial
objectives and achieves one
of five recognised end state
models

+

The Change Management challenge

…yet two thirds of companies had not placed a great deal of emphasis

on addressing people and cultural issues in planning for the post deal period

“Cultural & people issues present the biggest specific challenges

during the post deal period…”

Source:

KPMG Global M&A survey 2005

Top post deal challenges

4%
10%
24%
27%
30%
32%
Time and
management
Customer retention
IT
People issues
Dealing with different
organisation cultures
Complex integration
of two businesses
Proportion of respondents
Only 20% of respondents were very well

prepared to deal with cultures differences


Cultural challenges


Differences in working styles,
leadership approach


National culture differences


Behavioural differences


People Issues


Key members of management

team leaving


Employee moral and motivation


Retention of key staff


Consultation with staff and
representative bodies

BT’s change management approach


9 out of 10 barriers to change are people related


In all M&A activities


BT consider how we will identify and manage the human
impacts of change in order to deliver the business goals and strategy.


Our change programmes are distinct from, but linked to, the more technical HR
elements of M&A such as benefit and job alignments.


We address both the day 1 issues (systems access, tools etc) and the longer
term integration needs of employees.


Typically our change programmes address:


Change definition (what, why, when, how)


Change leadership style & capability of BT &

the target company


Culture, behaviour & climate


Communications & engagement


Relationship / stakeholder management


Organisational structures


Skills & capabilities

Business impacts

Change management focus

Strategy &
Business Plan

Technical
impacts

People
impacts

ePulse survey 2007

I am able to perform my job as


effectively as before the acquisition

2%

1%

14%

42%

40%

Strongly Disagree

Disagree

Neither

Agree

Strongly Agree

I understand the business rationale for the
acquisition of !!!!!!! Ltd by BT Global Services

3%

2%

10%

58%

27%

Strongly Disagree

Disagree

Neither

Agree

Strongly Agree

I understand the BT Country

Business Strategy

1%

3%

13%

60%

24%

Strongly Disagree

Disagree

Neither

Agree

Strongly Agree

I am clear about what is currently

expected of me in my job

0%

3%

13%

54%

31%

Strongly Disagree

Disagree

Neither

Agree

Strongly Agree

M&A Integration Practice (M&AIP)


our role


The M&AIP is the CoE for integration capability, methodology and skills:


with an overall priority for the successful delivery of integration projects


determining overall integration strategy, methods and approach.


engaging in the pre
-
transaction deal team
-

integration due diligence, business case refinement, planning
and preparation


engaging and developing the wider integration community in GS, and wider e.g. BT Retail, BT Design


providing Integration Directors team for the integration projects for each acquisition.


Transferring integration skills to wider BT community (i.e. Comsat)


Live Projects: 80%


Post OC engagement


Focus on integration elements of business case


Integration DD, BC assumptions and application of historic
learning


Ensure increased integration planning and preparation
-

validation of synergies, integration budget and cost inputs,
pre closure communications, change management,
integration resource in place and ready. Blueprint
philosophy


ID tasked with delivery


Close monitoring/support in first 12 months


Ongoing assessment audits of integration project


After 12 months quarterly reviews till close


Key driver is achievement of acquisition business case
goals


Support project team


Risk/mitigation strategies


Establish and develop the virtual M&A community within BT


Ensure Integration expertise and experience I harnessed for
continuous improvement


Identify new integration directors and programme managers


Maintain resource and skill list for rapid deployment across
projects and repeatability benefits


Thought leadership of M&A integration


Promote our capabilities to internal/external audiences,
supporting BT strategic themes


Standardised methodology


version controlled robust
approach


Consistent and repeatable


Adaptable to varying business requirements but within
common structure


Minimise risks of diverse approaches to future projects


Invest our substantial earning


Central set of integration tools and templates


Reporting and governance


Fasttrack to project readiness

Pre
-
transaction

Post
-
Merger Integration (PMI)

M&A Skills & Community

Method and skills: 20%

Time/resource Allocation

M&A timelines

Externally recognised as “Best in Class” integration Methodology

M&A Integration Practice Methodology

Prospect
-

IIP

Business Case

OC approval

Due Diligence

Resource ID

Team Selection

Day
-
1 Blueprint

Day
-
1 HLMP

Integration Plans

Sign
-
off

Gatekeeping

Project Support

Charters and PDD’s

Integration HLMP

People/Change Management

Workshops

Kick
-
off

Synergy validation

Review

Checkpoints

Governance

Gatekeeping

Transition Workstreams
to BaU

Handover to BaU

MOUs

Key
activities

S
-
Day / A
-
Day Day
-
1





Day
-
1 + 12 months (e.g.)

In public domain but
BT NOT in control

BT in control

Formal Handover from Business Development Director to Integration Director Between A
-
Day & Day
-
1

Quarterly Reporting

Up to

Business case

life

Deal

Pipeline

-
IIPs/OC


Papers

Project Delivery / Ongoing Engagement

Monthly Reporting

Audit / Assessment

Support

Due Diligence

Planning

Training & BT
Kick
-
off


Pre
-
transaction


Integration




Transition BaU

The Pre
-
transaction phase

contents & flow


Integration Pre
-
transaction contributes to the production of best in class
Business Cases, through challenging & validating integration synergies and actions

Integration DD
Call
-
off &
Review Audios

Business Case

Gun

Jumping

Integration

Practice
Engagement

Integration

Team

Structure

Rules of
Engagement

Pre
-
transaction
Activity Tick List

Status Update
Meetings

Integration
Blueprint

(Day
-
1)

Security

Initial
Investment
Proposal

(IIP)


IIP to A
-
Day


A
-
Day to Day
-
1

Setting up the
Wider

Integration
Team

Security
Clearance

Setting up the
Core
Integration
Team

Integration
Programme Roles
& Responsibilities

Key Acquisition
People Retention

BT Share Dealing

Code

Earn
-
out
Arrangements

Due Diligence
(inc DD Report)

Integration
Planning Day
-
1
Checklist

Gatekeeping

Integration
Workshops
Timeline

CL&R Deal
Summary

Acquired
Portfolio Report

BT Mobile
Porting

Quality

Policy

Domain

Names

BT Kick
-
off
Workshop

Workstream
Charter

Project Definition
Document

(PDD)

Synergy Tracking
(Day
-
1)

Pre
-
transaction
Communications

Corporate
Social
Responsibility

Integration Team
Insider List &
Contacts

BT Fleet

High Level
Milestone Plan
(HLMP)

Programme
Information

Flow

Integration Workshops timeline (during Pre
-
transaction)

A
-
Day Day
-
1




Day
-
1 + 12 months (e.g.)

BT Kick
-
off Workshop

Between A
-
Day and Day
-
1

Joint Integration Kick
-
off Workshop

As soon as possible after Day
-
1

Synergy Validation Workshop

2
-
3 weeks after the Joint Integration Agreement Workshop

Full Team Rolling Review

2
-
3 weeks after the Synergy Validation Workshop

Prioritisation Workshop

2
-
3 weeks after the Synergy Validation
Workshop

Workstream Rolling Review

2
-
3 weeks after the Synergy Validation Workshop

Joint Integration Agreement Workshop

2
-
3 weeks after the Joint Integration Kick
-
off Workshop


Pre
-
transaction


Integration




Transition BaU

Programme information flow

Today's Date is
7-Dec-06
Status is
DRAFT

High Level Task
Task
Owner
Milestone
Key Deliverable
R
A
G
or
Complete
Tracking
Comments
Summary HLMP
Key information
that everyone
should know
Lead =
Programme
Manager
SYNERGY WORKSTREAM
FUNCTIONAL
WORKSTREAM
CRITICAL PATH
SALES
PORTFOLIO
REVENUE UPLIFT &
INTERLOCK
COST SAVINGS
CHANGE MANAGEMENT
INTERNAL COMMS
SYSTEMS
SECURITY
CS&NO
FINANCE
HR
CLR
PROCUREMENT
PROCESS, SKILLS &
RESOURCING
MARKETING
Lead = RESPONSIBILITY
Day to Day Driver =
primary contact
Overall milestones
HL0010
S-Day
"dd-mmm-yy"
For information

HL0020
A-Day
For information

HL0030
Day-1
For information

HL0040
Delivery of ** Acquisition ** 06/07 financials
CEO

HL0050
Delivery of 06/07 revenue synergies
Integration Director
HL0060
First PSG
Integration Director
HL0070
Organisational design recommendations
Integration Director
HL0080
Rebrand complete
Integration Director
HL0800
Handover to BaU
Integration Director
HL0900
Three year check
Integration Director
Integration
Synergies
2006/2007
Lead =
Integration
Director
Day to Day
Driver =
Programme
Manager
IS0100
TOTAL BUSINESS CASE SYNERGIES
Through FY09/10
Revenue: £nn.nM
EBITDA: £nn.nM
Integration Director
For Information
For Information
As captured in the business case
IS0110
Network
**Value**
Workstream Lead
IS0120
Customer
Services
**Value**
Workstream Lead
IS0120
Procurement
**Value**
Workstream Lead
IS0120
Etc.
**Value**
Workstream Lead
IS0200
Identifying Deltas to Business Case Synergies
(if any)
Integration Director
Capture any ongoing deltas to the
business case
IS0210
**Workstream and delta**
Workstream Lead
IS0220
**Workstream and delta**
Workstream Lead
IS0300
TARGET SYNERGIES 06/07
Revenue: £n.nM
EBITDA: £n.nM
Integration Director
IS0310
06/07 Revenue synergies
£0.4M
Workstream Lead
IS0320
06/07 EBITDA synergies
£0.2M
Workstream Lead
IS0400
TOTAL HR & INTEGRATION COSTS
Through FY09/10
HR costs: £n.nM
Integration costs: £n.nM
Integration Director
As captured in the business case
IS0410
HR costs
£n.nM
HR Workstream Lead
As captured in the business case
IS0420
Integration costs
£n.nM
Integration Director
As captured in the business case
IS0200
Identifying Deltas to Business Case Costs (if
any)
Integration Director
Capture any ongoing deltas to the
business case
Dependencies
All
Assumptions

Objectives

Projects

Owner

Risks

Assumptions

Milestones

Dependencies

Resources

Risks

Project
Budget

M&A
M&A
Integration
Integration
Practice
Practice
M&A
M&A
Integration
Integration
Practice
Practice
Slide:
2
© British Telecommunications plc 2006, All Rights Reserved.
The Contents of this Document are confidential to British Teleco
mmunications plc, all non
-
authorised use
is strictly prohibited.
Workstream
Overall
Planning
Progress vs.
milestones
BTGS
UK
Global Telecom Market
BT International
Global
Business &
Services
IP Networking
Systems & Security
Customer Service &
Network Operations
Human Resources
Finance
Strategy & Development
Commercial Legal and
Regulatory
Marketing
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
G
Key Risks
-
-
-
-
Key Achievements
-
-
-
-
-
-
-
Key Issues
-
-
-
-
Overall status:
G
G
G
**Acquisition Name**
-
Progress Summary
Synergy

Tracking

Charters

PDD’s

Blueprint

Checkpoint

HLMP Update

Action

Register

Issue & Risk

Register

Rationale

Vision

Integration

Structure

Etc.

PSG

The Integration


contents & flow

Programme
Steering Group
(PSG)

Workstream
Rolling

Review

Action Register

Issues & Risks
Register

Brochure
Blueprint

Integration
Process Matrix
Impact

Synergy
Tracking &
Reporting

Leadership

Synergy
Validation
Workshop

Motivation, Team
Building &
Recognition

Document
Register

First 30 Days and ongoing ….

Next 70 Days & ongoing ….

Last 100 Days

Joint
Integration
Kick
-
off
Workshop

Integration
Workshops

Timeline

Other Useful
Information

Governance

Programme
Reporting
Timeline

Checkpoint

Joint
Integration
Agreement
Workshop

Focus during

the first

100 Days

Quick

Wins

Full Team Rolling

Review

The Softer
Integration
Requirements

Integration
Communications

Prioritisation
Workshop

Re
-
branding

Culture

HLMP

(High Level
Milestone Plan)

Change
Management

Hygiene
Factors for
Day
-
1

Integration
Practice
Reviews

Formal
Handover to
the Integration
Team

Integration

Blueprint

The last

100 days

OUC’s and
Finance Transition

The Transition phase contents and flow

Transition

Principles
-

Outline

Transition
Principles
-

Moving to KPIs

Transition
Principles
-

KPIs

Transition
Options
-

Sequential

Transition
Options
-

Big Bang

Transition

to BaU Meeting
Outline

BaU

Tick

List

Integration
Practice

Review

BaU

Closure Report


completed, authorised

and signed Off

By ALL

Key Stakeholders

Systems / infrastructure alignment


Internal Infrastructure


BT.COM email and intranet access, Helpdesk Integration, Data
Centre & Server Consolidation


Contract and Complex Bid Management


Sales Force Front End


Implement BT global Services Sales Force Automation standard
system and OneSiebel for international sales


Complex Contract Bid Management tools


Portfolio Harmonisation


Feature mapping the existing product set to the harmonised portfolio
and re
-
branding of all customer facing applications


Customer Service Systems


Implementation of BTGS systems to support Lead to Cash and
Trouble to Resolve customer experiences


Network Management


Billing


Billing Branding Changes and migration to Strategic Billing Platform


Business Support Systems (BSS)


Access to standard back office systems via BT Intranet delivered
(ePeopleserve, Livelink, Titan, etc)


Pipeline


S
-
Day/A
-
Day


Due Diligence, cost and synergy inputs into Acquisition Business Case


Produce plans for Acquisition Integration


S
-
Day/A
-
Day


Day 1 (Decision on proceeding with Acquisition and announcement to Day 1 of full acquisition)


Interconnect infrastructures and access to BT Intranet and email integration


Load PeopleSoft and generate EIN’s


Day
-
1


L
-
Day (from full Acquisition up to Logo Day


Re
-
branding)


Billing, logo, website, Commercial Product Harmonisation and other branding changes.


Day 1/L
-
Day +


Alignment with BT Design strategy and operations for applications, people and budgets


Move acquisition to BAU

Infrastructure

Pipeline


S
-
Day/A
-
Day

Using standard
templates

and deliverables

Due Diligence

Integration


Stage 1

Integration Stage 2

S
-
Day/A
-
Day


Day 1

Day 1


L
-
Day

Day 1/L
-
Day +

Interconnectivity and
Systems

required for Day 1

‘Strategic Integration
and move to BAU

Integration
‘quick wins’

Acquisition Integration − High Level Activities

Infrastructure

Integration


Stage 1

Critical
Mass Point

Due Diligence

Infrastructure

Integration


Stage 1

Due Diligence

Infrastructure

Integration


Stage 1

2nd Acquisition in
Territory

3rd Acquisition in
Territory

4th Acquisition in
Territory

Due Diligence

Summary


Sales


BT & BT Infonet major cross /joint selling programme delivered in excess of $500M of joint sales
within a 2 year period, Announced in Q1 a new global services agreement (won in Q4 0607) with
Nestlé (£124m), one of the world’s leading food companies & Infonet customer for 15 years


Increased revenues in Italy from


600m, 2004, prior to acquisition now approaching a billion


Won Major Global Outsourcing deal with Fiat in Italy


Built a Cross /Joint sales pipeline with INS within 6 months


Counterpane exceeded 06/07 Revenue and EBIT targets. Launched Counterpane offering in all
countries and trained over 1000 GS sales and support personnel


CLSA signed five
-
year master $20M services agreement, 30 per cent of the overall solution


is a joint
BT and BT Counterpane proposition, enabling CLSA to deal proactively with potential threats by
permanently monitoring both the device and network layers to provide real
-
time 24x7 correlation of
alarms and analysis of security events and alerts


I2i Pipeline growing c5% monthly across 600 customers and

1300 opportunities


Comsat Joint sales strategy in place, cross
-
selling plan launched

Successes of recent key BT acquisitions

Summary


Operations


Achieved synergy target numbers and revenue growth, no disruption to business


Maintained customer service satisfaction as we integrate acquisitions’ service operations


Currently deploying the BT Infonet way of working, a world class global service model with
fully automated service processes that are deployed globally on a common system stack


Customer service unaffected and BT Italia perceived as a serious player and a credible
alternative by large customers in Italy


Migrated all Infonet customers managed via ISS (Competitor of Counterpane) onto
Counterpane services within 6 weeks


Preserved Business Continuity and Momentum


Financial


BT Infonet Acquisition Integration Team Achieved 3 yr savings of $150M within 2 years

“1 Year” early!!!


Acquired the Fiat IT subsidiary “Atlanet”, increasing coverage and revenue potential in Italy


Successes of recent key BT acquisitions

Summary


Organisation / Re
-
structuring


BT converted part Infonet ownership into full BT ownership in key markets, Germany, India, Russia


BT has Integrated the Infonet organisation into the BT organisation and achieved ISO 9001
accreditation


Outsourced Call Centre in Italy


Completed Property consolidation in US, selling


lease back, Infonet’s HQ in El Segundo


Transitioned 100 Professional Service professionals from BTGS to INS Systems, methodologies and
on INS T&C's


Migrated all Infonet customers managed via ISS (Competitor of Counterpane) onto Counterpane
services within 6 weeks



People


"Insight to BT” on line on boarding programme provides effective BT orientation for all acquisitions on
a cost effective basis, supporting initial Welcome sessions


Focus on communications & employee engagement ensures high levels of awareness of business
rationale for acquisition amongst employees, driving high awareness of requirements of them and
high motivation at early stage in integration


Acquisition skills retained to influence future business direction with appointment of BT Infonet
Service managers into key BT service leadership posts


Managed 100% people retention from Counterpane integration


Albacom, Key talent retained and introduction of GS people programmes, people feel part of the
whole of BT (measured by CARE survey)

Successes of recent key BT acquisitions

Lessons learnt and continuous improvement


Reduced expense and complexity


Full line of sight into acquired
business


Customer impacts :


Service and delivery
processes


Bids/Billing


SLAs/Contract
Management



The deal outline is agreed early

in negotiation


default setting is full integration and quickly ……


Limit Old culture/behaviours as
quickly as possible


Employees expecting and
receptive to change within 180
days of close


Facilitates identification of key
talent and retention


Opens BT career progression
opportunities



Driving sales opportunities within
GS needs links to GS sales,
delivery and CS processes


Portfolio alignment


leverage acquisition capabilities
to broader BT


Reduce customer confusion with
co
-
ordinated sales programmes


Minimise bid/bill complexity

…. Important to maximise ROI and retain and protect valuable acquired
assets…..employees, customers, IPR…..

…. standardise
systems and
processes

….introduction of


BT culture

and values

….effective cross
-
selling and revenue
uplift programmes

….target CEO etc
continue to run
business


Increases business
momentum/continuity


Align personal objectives with
integration


Retain valuable IPR and talent


Endorse BT comms and deal
rationale


Leverage existing
customer/supplier relationships


FULL and RAPID


Drive for Standardisation (only keep acquisitions stand
-
alone in
exceptional circumstances…)

Lessons learnt and continuous improvement

Completed and
presented with

1
st

OC Paper

Early view of integration model and
focus to complete checklist

Integration strategy checklist

Lessons learnt and continuous improvement

Due diligence − approach

Finance, Legal

& External Advisors

Integration

Operational

Confirmatory

Culture

Ops Team

And how are we doing?


Consistent delivery of integration plans and cost savings


Good overall employee and customer retention. Very positive employee survey results

from recent acquisitions


Demonstrating an increasing capability to cross
-
sell between customers and portfolios

and win business quickly after completion of the acquisitions


Proven ability to leverage capabilities from acquisitions to overall benefit in Global
Services


Focused on continuous improvement of M&A integration capability and recycling learning
from previous transactions


Increasing standardisation in acquisition integration and accelerating speed of alignment

to BT systems and processes


Best in class financial results


Clear benefits from establishing a capability of skilled Integration practitioners and a
repeatable, robust integration methodology

“Our unique M&A end to end Integration process is a

clear point of competitive advantage”

Offices worldwide


Telecommunications services described are subject to availability and may be modified from time to time.
Services and equipment are provided subject to British Telecommunications plc's respective standard
conditions of contract. Nothing in this publication forms any part of any contract.


© British Telecommunications plc 2007

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