The mergers & acquisitions (M&A) market is red hot, and there is a good chance your company will be involved in an M&A at some point in your career. The work that it takes to pull off a successful M&A, however, can be staggering, and 70-90 percent end up being considered abysmal failures.
That’s why we are taking the time to outline the biggest threats to a successful M&A and how you can lay a foundation for success before anyone even signs on the dotted line.
In part one of our five part mergers and acquisitions (M&A) series, we tackled the challenge of efficiently onboarding new employees immediately following an M&A. Without a modern Identity and Access Management (IAM) solution working for you, the complexity of integrating two companies can overwhelm even the best IT team and risk the success of an M&A. With the help of IAM, however, the time-consuming and complicated onboarding process is transformed into a simplified, streamlined process.
But at that point, it’s likely you’ll run into another challenge: each organization has its own directory (or multiple directories) where employee identity data is stored. Post-M&A, your company might suddenly have two distinct Active Directories, two LDAP directories, or more—potentially a lot more. And when identity data is siloed and segmented, it is difficult to keep information consistent and synchronized from one source to another.
So, how can a modern IAM solution help you manage identities across multiple domains?
The Challenge of Managing Identities Across Multiple Domains
Undoubtedly, consolidation of identities is one of the most challenging parts of integrating two companies. The process can be time-consuming and costly. Conducting security reviews, deploying hardware and migration tools, and making necessary changes to your environment can take months—or even years. So, even if your plan is to consolidate, it’s not going to happen immediately.
In the meantime, you need to be able to manage those separate domains. However, without a robust IAM solution in place, this is a painful process because managing the identities within these separate domains must be done manually. This can quickly monopolize your IT staff’s time, leaving them unable to focus on other integration-related priorities.
Furthermore, manually managing multiple domains leads to widespread duplication of processes and more inherent complexity, leading to a higher likelihood for error. The result? More doors into your environment are left open, multiplying security risks.
How a Modern IAM Solution Enables Domain Consolidation at Your Own Pace
With modern IAM in place, your organization can consolidate on its own schedule— or simply leave the domains as they are. You do not have to consolidate directories prior to automating and centralizing identity management of the acquired company’s users. Plus, the right solution offers the flexibility to do this in multiple ways, depending on what best fits your organization’s needs.
Let’s start with our recommendation: Create a metadirectory above the individual directories that acts as a single, centralized source of truth. The metadirectory collects and synchronizes user identities and group data across multiple, disparate directories without actual consolidation.
However, we have seen other strategies successfully implemented with modern IAM as well. One option is to maintain separate domains that continue to operate independently, but use a central interface and policy structure for managing identities.
With this option, you can define policies using a logic that says: if new account information originates from Company 1’s HR system, then the new account is created in the company1.com domain, and if that information originates from Company 2’s HR system, then the new account is created in the company2.com domain. Thus, no accounts for Company 1 are created in Company 2, and vice versa.
M&A Underway: Integration Complications
And just like that, another major M&A challenge has a solution. With an IAM solution in place, you are able to automate and centralize identity management across multiple domains. Increased visibility and automation mean your organization is more secure against cyber threats. Your IT team can consolidate these domains (or not) at their own pace, allowing them to work on their own timeline and, if needed, allocate more of their time upfront to other projects.
In part three, we’ll move onto the challenge of technology integration. This process can quickly become a nightmare without an IAM solution—or with the wrong IAM solution, in place.
Or, to skip head, download our full guide, IT Success in M&A starts with IAM, which includes all five M&A challenges and solutions, along with pro tips to put your IT team ahead of the M&A game.