Achieving synergies across different businesses or geographies.
The integration challenge: All multi-divisional organisations strive to achieve greater synergies across their operations, whether it is across business processes, IT systems or product platforms. The response by many is to standardise and centralise operations, introduce global ERP solutions or move to shared service centres. While these strategies can lead to lower operating costs, they can also create a negative impact on the customer experience and lead to a lack of innovation.
Our point of view on horizontal integration: Our view is that ‘one size does not fit all’. While multi-divisional organisations can achieve greater synergies through the use of ‘common and shared’ business processes and IT systems, it’s imperative to recognise the need for ‘authentic’ differences. These authentic differences need to reflect genuine and justifiable differentiated needs in respect of customers, service and regulatory requirements.
Our experience: We have helped clients develop regional and enterprise-wide operating model strategies that achieve the required synergies while addressing the authentic differences required of the markets in which they operate. The principles that we have developed have been applied across many industries including mining, minerals, chemicals, speciality chemicals, pharmaceuticals and financial services.