When a company acquires a new business, planning and executing the integration process carefully is important to ensure a smooth transition and set the new venture up for long-term success. One example of this is Nike's acquisition of Celect, a Boston-based retail analytics startup, in 2019.
Nike's acquisition of Celect was motivated by the desire to enhance its direct-to-consumer (DTC) capabilities and improve its supply chain operations. To ensure a successful integration, Nike followed several key steps.
Step 1: Communicate Clearly and Consistently
Firstly, Be transparent about your plans for the business, what changes will be made, and how those changes will affect everyone involved. Create a communication plan and stick to it, using multiple channels to reach all stakeholders and address their concerns. Clear and consistent communication was established between Nike and Celect's employees, customers, vendors, and partners. Nike was transparent about its plans for the business, what changes would be made, and how those changes would affect everyone involved. This helped to build trust and confidence among stakeholders.
Step 2: Assess Your Resources
Additionally, it's important to assess your new resources and how they fit into your overall strategy. Nike assessed Celect's resources, including its products, services, employees, and technology. Nike determined which assets were critical to its success and how they could be integrated into its existing operations. In this case, Nike incorporated Celect's technology into its DTC operations and supply chain management systems.
Step 3: Identify Synergies
Furthermore, look for areas of synergy between the two companies. By combining resources, streamlining operations, and leveraging the strengths of both organizations, Nike was able to improve efficiency, reduce costs, and enhance the customer experience. For example, Nike used Celect's technology to better predict consumer demand and optimize inventory levels.
Step 4: Set Clear Goals and Metrics
To ensure a successful integration, it's important to set clear goals and metrics for the new business. Determine what success looks like for the integration and establish milestones and metrics to track progress. Nike set clear goals and metrics for the integration, including financial metrics such as revenue and profit, as well as non-financial metrics such as customer satisfaction and employee retention. This helped Nike track progress and ensure that the integration met its objectives.
Step 5: Build a Strong Culture
After an acquisition, it's important to build a strong culture that aligns with your company's values and mission. This involved building relationships with the Celect team, celebrating successes, and fostering a sense of belonging and shared purpose.
Step 6: Monitor Progress and Make Adjustments
Finally, Keep an eye on the metrics and milestones you established and be willing to make changes to your integration plan if necessary. Nike monitored progress and made adjustments as needed. By staying flexible and open to feedback, Nike was able to make changes to its integration plan and ensure a successful outcome.
Overall, Nike's acquisition of Celect demonstrates the importance of careful planning and execution in the integration process. By following these key steps, companies can ensure a successful integration and set themselves up for long-term success.