Considerations for Mergers & Acquisitions

Finding the right eDiscovery service takes time and consideration. Firms must weigh their in-house ability against outsourcing and invest time to source the appropriate technology and partnership for their needs. This initial step sets the stage for measuring a firm's optimal success. In selecting a vendor, firms determine their workflows and ultimately define their service costs. So, what happens when an eDiscovery service becomes involved in a Merger or Acquisition (M&A)? And how do users adjust to disparate systems assuming their casework?

One may speculate a more excellent service product with new capabilities to handle every litigation step or better support for an unwavering product. Instead, the reality may result in a lengthy integration period and a focus on the merger versus ensuring an optimal service. To mitigate risk, clients should request an action plan from the merging vendors and assess if the end product still outmatches that of an outsourced litigation partner.

In the ever-changing legal industry, M&As are bound to happen. M&As are a business endeavor that don’t necessarily have current clients in mind. They capture new audiences for businesses that have exhausted their current markets and attempt to monopolize the remainder. Regardless of the aftermath, they cause an impact, so here's what to consider:

What can happen in the aftermath of an M&A?

• Poor Due Diligence: This depends upon the actions of businesses involved in an M&A and can lead to a lengthy transitional period of navigating contracts, financial stability, insurance, customer agreements, distribution and compensation agreements, employment contracts, and debt. This phase can muddy the transparency of a trusted vendor undergoing new processes and stall quality service in the interim. 

• Post-Merger Integration (PMI): M&As will undergo a synergy of processes to find their unified brand, impacting:

• Processes, systems, and technology: Consider the initial time and effort required for a firm to select its eDiscovery service and how this decision later determines workflows and billable breakdowns. Firms will have to learn new workflows and processes again, costing time and energy. The time of this adjustment will be determined by the merging companies aligning their individual methods into one agreeable action plan – and that plan may or may not keep individual client processes in mind. This period may also challenge price stability. With new technology and capabilities, M&As may seek higher payment for their increased value. Firms will have to consider the aftermath of their service costs thoughtfully. 

• Communication and Employee Engagement: Those working for companies undergoing an M&A may feel less invested, leading to turnover and poor performance. Among merging their services, companies are also reconsidering their brand, culture, work expectations, leadership roles, and more, temporarily creating an unsteady environment for their workforce. Unfortunately, communication will also shift while firms need more support, wanting assurance of consistency and security.

• Security and Service-Levels: M&As must ensure IT processes, policies, and infrastructure are ready for mass expansion and data absorption. IT must diligently monitor cyberattacks and certify that all transferred data has no conflicts between applications. For those undergoing a merge, consider the due diligence your in-house IT team needs for a successful transition. As technologies merge, clients should verify their service contract includes regular updates of applications and isn't neglected as new applications surface.

Although transitional periods will follow M&As, under the guise of a competitive provider, the time will be minimal and effective for all to move forward.

Some firms may find themselves unsure of how an M&A affects their operation and may even challenge them to reconsider their overall service. For those firms, outsourcing to a litigation provider may be the solution.

Steady Service in Outsourcing 

The balance in deciding to outsource litigation support or invest in in-house applications dramatically affects how a firm will define its entire infrastructure. Assessing the cost of training and retaining talent to navigating a complete partnership with a vendor depends on the capabilities of a firm, its future projection, and desire for greater tech adoption.

Outsourcing can be an excellent option for those hesitant to take on too much automation without proper oversight. Many vendors already have access to leading eDiscovery platforms with an extensive support team to vet their value. Rather than contracting multiple companies to complete an end-to-end eDiscovery journey, an outsource vendor can invest in the "800 lb. Gorilla" platform that stands ahead of the rest and place experienced attorneys to monitor and issue work.

IST Management offers a managed instance of Relativity, a leading eDiscovery platform, storing data in a private cloud and pairing Project Managers to assist each case matter. Instead of making sense of disparate systems and processes, clients can simply manage a service contract and have peace of mind for their operation's future growth. The benefits M&As promise are instead guaranteed with a large organization that can quickly source leading technology and seamlessly contain it into one organization.

Mergers and Acquisitions do happen, so staying informed on what to expect and potential options is critical. Aligning key stakeholders' vision and IT processes, firms should focus on data migration and security and keep communication open within their internal operations. In the event certain risks occur, exploring steadier service options will guarantee that any size firm keeps its focus clear and forward moving.