Identity Management Challenges of M&A
Recent research revealed the number of mergers and acquisitions (M&A) reached approximately 62,000 globally in 2021, up an unprecedented 24% from the previous year—and 2022 is projected to have significantly higher numbers.
However, with the soaring numbers of acquisitions and mergers comes complexity and challenges that can eventually impact post-merger success rates. Whether it’s employee records, security protocols or compliance obligations, everything must be flawlessly integrated to ensure client satisfaction and shareholders’ profitability.
Here’s where technology—in the form of a consumer identity and access management (CIAM) solution becomes critical to seamlessly reduce conflicts and overcome the barriers that can hamper post-merger success.
Why Enterprises Need a CIAM Solution
After a merger, a consumer identity and access management (CIAM) solution helps organizations with identity centralization and IT integration. Since the newly-merged organization needs to ensure all its employees and clients have access to software and applications specific to their roles, managing hundreds, thousands or even millions of identities becomes incredibly difficult.
Moreover, the overall onboarding time could easily contribute to poor quality of service and increased downtime that inversely affects consumer experience and increases employee frustration. Modern CIAM solutions help connect seamlessly to the employee directory of the company as well as ensure frictionless onboarding clients to the new company.
Apart from this, a CIAM solution offers user provisioning coupled with multi-directory resource and identity administration for better control over the entire directory. Identity and access management solutions are critical, but there are some significant challenges that arise post-merger; these can also be addressed using an CIAM solution.
Security and M&A
Cybercriminals are frequently looking to exploit security loopholes during mergers and acquisitions since organizations are more vulnerable during this period. Most companies often overlook or ignore security issues inherited from the acquired business, which can lead to severe security breaches and data thefts, among other significant breaches, causing losses worth millions of dollars. An acquired company’s outdated security architecture, technology and/or processes may also increase the risk for both employees and clients since attackers may exploit sensitive data and a business’ brand may end up tarnished.
A modern CIAM could help heighten the overall security architecture of the company by incorporating identity governance policies and unleashing the true potential of a multifactor authentication (MFA) mechanism.
Seamless Integration of Systems and Technologies
It’s evident that a merger necessitates the integration of multiple technologies and systems, including software, hardware and applications. Now, this can be pretty challenging in the initial stages.
However, a CIAM can pave the way for a smooth transition. When a company leverages a CIAM during a merger and acquisition, they can integrate technologies more easily without losing control over centralized data.
Since integrating two or more systems involves the migration of heaps of user and employee data, mitigating the workload issues and unnecessary delays could be an uphill battle. But a CIAM in place could help overcome any hurdle without any hassle.
Managing Millions of Identities Across Different Directories
Whenever a company is acquired or merged, the heaps of identity data stored in its directories are combined with the acquiring company’s directories. However, it’s not a piece of cake for IT teams to consolidate and synchronize these identities without investing a lot of time, resources, and effort. But with a CIAM in place, businesses can quickly automate and centralize identity management without errors or delays.
A CIAM makes it pretty easy to manage different repositories compared to doing so using a manual process, which is quite daunting and time-consuming. Hence, identity management through a CIAM is the best way to ensure millions of identities of both the acquired and acquiring company can be quickly and securely integrated and managed without investing more effort, time, and money.
The Bottom Line
A successful integration during a merger and acquisition is the key to business success in the long run. And it’s crucial to bring all the employees, clients, data and systems of the acquired company under the acquiring company’s control to reinforce security and visibility.
An identity management solution plays a crucial role in the overall success of an M&A process by ensuring smooth integration and deployment without compromising overall data security and privacy. Businesses shouldn’t overlook the importance of incorporating an identity management solution that offers endless possibilities during the overall merger and acquisition process.
