Visionary Voices
Post-Deal M&A Challenges
The Biggest Risk Isn’t Bad Strategy; It’s Forgetting the Strategy
The Integration Starts When the Headlines Stop
After a lull in early 2025, Financial Services deal activity is back. But while boards celebrate strategic combinations, the operational complexity of integration rarely makes the press release. Stephen says that’s where most firms miscalculate.
“Post-deal is where most M&A challenges begin—not end.”
Stephen’s team is typically brought in after a deal is signed—but before Day One. The focus is on establishing an integration management office (IMO), defining the target operating model, and designing a roadmap for execution. Yet many clients underestimate what comes next: HR systems, financial controls, client platforms, and risk infrastructure all require deep integration across two organizations. “That’s where the work starts,” Stephen says. “And where the risk grows.”
The Day Four Problem
“Everyone focuses on Day One,” he says. “But Day Four is what really matters.”
Day One is largely about stability—making sure financial reporting isn’t disrupted; leadership roles are clear, and clients stay informed. Day Two and Day Three usher in the heavier lift: technology, data, compliance, and controls. But it’s Day Four that matters most.
“Everyone declares victory. But funding dries up, systems remain duplicated, and legacy debt builds quietly.”
Stephen calls it the Day Four problem—when firms assume integration is complete, but the foundational work remains. Over time, that leads to technical debt, data fragmentation, and increased regulatory risk.
In due diligence, firms only learn a fraction about the systems they’re inheriting. Traditional Financial Service firms are often saddled with legacy tech—sometimes decades old. That becomes a problem when integration decisions bump up against aging systems and constrained budgets. “The biggest decision in FS M&A,” Stephen notes, “is whether to modernize now—or defer.” But deferring builds tech debt that’s even harder to fix later.
Prioritizing What Actually Matters
To avoid missteps, Stephen urges FS leaders to ground all integration decisions in the original deal thesis. Was the goal synergy? AUM growth? Customer acquisition? “That’s your North Star,” he says. But that’s just the starting point. Stephen recommends a four-part framework for prioritizing post-close work:
1
Strategic Rationale – Tie every integration action to the reason for the deal.
2
Regulatory Compliance – Avoid missteps in reporting, controls, and oversight.
3
People & SMEs – Identify who holds critical knowledge and ensure that expertise is retained throughout the transition.
4
Synergy Realization – Deliver the value promised to the board.
When those elements are balanced, integration becomes purposeful.
Looking Ahead: Advice for FS Leaders
Stephen’s guidance to CFOs:
- Don’t underestimate culture. It’s the number one reason integrations fail.
- Fund what doesn’t get done. Day Four work still needs support.
- Protect the value. Don’t let integration erode what you just bought.
“The biggest risk isn’t bad strategy—it’s forgetting the strategy during integration.”
Successful integrations, Stephen believes, require ongoing attention—not just an IMO checklist. “It’s not a 100-day plan,” he says. “It’s a multi-year transformation.”
Ready to move from deal signed to value realized? Whether it’s designing your integration roadmap, accelerating synergy realization, or mitigating compliance risk—we’re here to make your M&A work.
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