Solutions Success Story: How iGate Created a Post-Acquisition Solutions Development Process
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Creating an effective and efficient solutions development process is, in itself, a difficult task. We know of a lot of both technology and non-technology companies that are struggling to do this. Getting all of the product and services groups, as well the key component and channel partners, on the same page to create the right solution for the right target market is a daunting task. Layer on top of that an acquisition with a very different type of company and what then comes out of the “solutions factory” can be questionable at best. This is what iGate had to deal with when it acquired Patni.The Acquisition of Patni and the Issues it Raised
In January of 2011, iGate closed a deal and acquired Patni Computer Sytems, a top ten Indian IT services company that delivered a range of IT services through globally integrated onsite and offshore delivery locations, primarily in India. iGate at the time was the first Business Outcomes driven integrated Technology and Operations (iTOPS) solutions provider with a global delivery model. It enabled clients to optimize their business through a combination of process investment strategies, technology leverage and business process outsourcing and provisioning.The issues that iGate faced were: 1. How could it integrate Patni, which had 3 times as many employees as iGate, into its operations? 2. iGate’s consultants were responsible for the front-end customer discussions and early problem analyses. How could they make sure that they wouldn’t simply throw the opportunities and solutions needs “over the wall” to the Patni’s team of solutions developers and architects? Should the two groups remain separate? Should they be forced to integrate? If they were to be integrated, how should they do it? Creating One, Integrated Solutions Development Process Shortly after the acquisition took effect, a joint iGate/Patni team came together to decide how best to handle the operations. They jointly decided upon the following principles:
The Solutions Development Framework
Although iGate had a solutions development framework, post-acquisition of Patni it was by far enhanced and improved with what Patni team was able to complement. This enhanced framework had two major components – the first part focused on defining the new solutions offering, and the associated investments, and the second part dealt with the steps required to develop and take the solution to market.
The new Integrated Solutions Development Framework (ISDF) had the full involvement and support of both companies, and leveraged the strengths and experience that both parties brought to the new, larger company. In fact, primary justification for the acquisition was that the two companies were highly complementary in their competencies and skill sets. Patni had excellent technical capabilities and strong micro-domain knowledge – the understanding of sub-segments within a vertical – and iGate had a professional staff of process, domain and operational consultants.
The ISDF was based upon a standard product development Stage-Gate process, In fact, each of the solutions that were evaluated and then developed through the process were the responsibility of a Product Manager. While other companies have built solutions development models that are significantly different from their product development activities, iGate and the newly acquired Patni decided to follow the more standard product development set of processes. The only major variance was that there was a consulting analysis component at the front end to gain a deep understanding of the customers’ needs.
Lessons LearnedIn looking back upon the integration of the iGate and Patni solution development processes into one that has become the backbone of the company, and a best practice in the industry, there are several lessons that be pulled from their experience:
Integrating two different companies is always a challenge. For solutions businesses, getting the offering development and implementation processes defined and smoothed out is an especially thorny proposition. By all accounts, it appears that iGate has done a great job of moving from the promise to the realization of the synergy and benefits it saw when it acquired Patni.
The process of integration for iGate when it acquired Patni I am sure was a difficult process. For a solutions definition and investment plan of 4-6 weeks followed by a 3-6 month implementation timeframe. That is really impressive that a complex integration could be managed any faster than 4-6 months, as mentioned in the Lessons Learned portions.
Very nicely written and well summarized. You got me thinking and now I can't help but share a few thoughts on this. This looked like an especially challenging integration case, and it's nice to see the frameworks effective in guiding the process. It's a lot like putting a jigsaw puzzle together. On one hand you've got these micro domain experts and on the other you've got these process and macro domain experts. That makes for some great synergy, especially if you can establish effective communication between the two sides. Better yet, remove the distinction of the two companies in the mindsets of the employees. It's a nice insight that you can accomplish this faster by establishing a common terminology within the company. We don't tend to think about it often, but the language we use is an effective shortcut in identifying the people we relate to, and to borrow terminology from sociology, consider to be part of our in-group. There's plenty of examples out there of failed mergers and that's a common theme in many of them -- a clash of cultures. Trimming down the offerings has the same effect. The offerings are now decided upon as a company. It has the effect that it's something "we" as a company made. And it has the effect as you mentioned that only the strongest solutions make it to the marketplace. Those are easier to communicate to clients and make a better impression.
This blogpost is very interesting in detailing the struggles that arise when companies decide to integrate in order to better serve their customers following an acquisition. Considering Patni’s size, did major issues arise when trying to alter their overall identity in order to merge the two companies? And, when dealing with a larger acquired company, and a smaller parent company, who has to compromise the most? In order for such a situation to lead to success, consultants and the sales force must be aligned with the developers. Are these two departments the most difficult to integrate, as it would seem, or does their common goal make them more motivated to speed up the integration process?
Its interesting to understand how fast and efficient can be the process of integration from two different business in order to enhance the company's offerings, maximizing efficiency and minimizing competition. Applied to the case above, even though both companies were playing in the same industry therefore theoretically the merging process was supposed to run smoothly, iGate still had to overcome the challenge of losing its own corporate culture given the size of Patni; align internal processes and also streamline its portfolio in order to make it more manageble. Very insightful theory applied to the reality.