Many healthcare organizations have merger and acquisition (M&A) and reorganization plans for 2021. And as we’ve covered in our recent case study, Healthcare Merger and Acquisition Management—A Workday Case Study, every organization has its own set of unique challenges, challenges that are nothing to sneeze at.
According to a Harvard Business Review report, the failure rate for mergers and acquisitions is between 70 and 90 percent. That figure may seem overly high, but when you consider the number of moving pieces in an M&A—especially in the healthcare industry, where HIPAA and other patient privacy requirements are strict—it’s easy to see how failure is more the rule than the exception.
What failure is not, however, is an inevitability. Your M&A can be a success if you plan carefully, commit to your execution, take advantage of a solid solution (such as Workday), and partner with the right experts. To help you along, we’ve consulted our senior-level Workday consultants on some tips and tricks for using Workday to navigate a healthcare M&A, and we put together this checklist of things to consider before getting started with your project.
Here’s everything you need to know:
Plan for Your Future Structure Early
The very first step to a successful healthcare M&A is taking a high-level view of how your organization currently looks and then thinking about how it will change afterward. How is your management structure set up? Are you combining or phasing out certain levels? Will you be adding locations or new cost centers? These are just a few of the many questions to think through when planning. Workday makes this process much easier thanks to its variety of tools that help with organization management. Additionally, we stress the importance of documenting everything. (You’ll thank us later.)
Map Out Your Data Integration Plan
Integrating data from the hospital, clinic, or other companies you may be acquiring is one of the most extensive tasks in any merger or acquisition. Making the task even more challenging is all the different systems, fields, and business models you’ll need to juggle to keep everything coherent (not to mention aspects like HL7 and HIPAA requirements). But the good news is that Workday makes this process much smoother than other legacy systems.
Another way to make things easier on yourself is to work with an experienced consultant that can help your team identify all the data and different fields they’re going to need to be converted into Workday (as well as how to do so correctly, the first time). Someone who’s navigated this sort of terrain before at other companies is invaluable, as they’re able to provide you with first-hand experience of what’s worked and what hasn’t at other healthcare organizations, helping you avoid “shortcuts” that end up doubling your workload or asking useful questions your team never would have considered.
Identify Your Resource Needs
When diving into an M&A project with Workday, you’ll need to build a strong team. Consider the resources required to gather the requirements as well as building the system. Who is doing configuration? Who will be involved in data gathering? How will the process look down the line?
There are lots of things to consider when aligning all the processes and building the new steps in Workday. But the aspect clients most often forget is to ask themselves who will manage the day-to-day work (aka “keep the lights on”) while everyone is busy driving the M&A? Expecting everyone to function perfectly at their regular job while also driving the M&A is a mug’s game. Consider the short-term gaps that are bound to occur during the project and plan for them from the beginning.
Develop a Change Management and Communications Plan
When it comes to any kind of change, communication is key. Developing a change management plan will help your communications team relay the right information to stakeholders, managers, and employees at the right time. Think about how you want to approach training, how-to materials, dashboards, documentation for human resources (HR), and self-service tools for managers. Another tip we recommend is to be consistent and transparent on what people can expect and when. After all, there’s a big difference between communicating and communicating clearly. (There’s a joke in here somewhere about the average doctor’s handwriting…)
Partner with a Workday consultant
Undergoing an M&A can be daunting, and when you look at the numbers, it can seem like the odds are stacked against you. Beyond using our checklist for success, there is one thing you can do to set yourself up for success—partner with an experienced Workday consultant. An in-house expert can be your advisor throughout the M&A and beyond, helping to troubleshoot issues long after go-live.