CMO in the Spotlight: Managing Post-Merger risks to Account Management and Client Service Delivery

CMO in the Spotlight: Managing Post-Merger risks to Account Management and Client Service Delivery

“When a firm merges, a vital task for the CMO is to manage the client-related risks of the deal and to deliver many of the associated benefits of the enlarged organisation. If the tie-up has an international dimension, maintaining levels of client service delivery and ‘business as usual’ adds to the complexity of post-merger activities.”
James Edsberg – Partner – Gulland Padfield

We’re living through an unprecedented era of consolidation and change in professional services. In a recent study*, 58% of UK law firms viewed mergers & acquisitions as a major opportunity to drive growth. Half of the Top 10 UK law firms said they expect to merge with or acquire an international firm in the next three years – something the majority were not considering when asked the same question in 2011. In Accountancy, the mid-market (particularly in the US) is set for further consolidation. BDO and PKF are the latest firms to conclude a mid-market tie-up in the UK. And at the time of writing, PwC was considering a bid for the German Management Consultancy, Roland Berger. Deloitte’s acquired Monitor earlier this year. KPMG and Ernst & Young have also merged with other consulting brands in the US and Europe. It’s a similar pattern across parts of the professional services sector

When two professional firms merge, a long line of hurdles needs to be cleared for the process to deliver a lasting, positive outcome. This depends not just on the successful negotiation of a deal, but on the agreement and implementation of a post-merger plan to harmonise two businesses including their respective governance, operations, IT systems, remuneration policies, brand, communications and culture.

At the top of the post merger agenda, is the new partnership’s wish to preserve and grow their client relationships.

This puts CMOs and their teams in a bright spotlight in the pre and post-merger process. With many firms likely to merge over the next 2 years, there are three particular challenges which today’s Marketing and Business Development teams should prepare to face.


The first challenge comes early on in the merger process when each firm reviews the support departments in the other’s business. What starts as a compatibility assessment of the respective Marketing & Business Development functions of the two firms, usually becomes an evaluation of their relative effectiveness.

Management teams will want to reach a quick conclusion on how easily their firms’ market-facing initiatives can be harmonised. And where that isn’t possible, to make a choice about which aspects are best from each firm. This process can be made more awkward if the CMO is making the case for their strategy as they re-interview for their role in the newly-combined firm.
Marketing teams should expect detailed questions often focused on cost. The responsible way to answer, is to articulate the business case for each of aspect of marketing activity and to show a clear line linking KPIs to the delivery of the firm’s strategy. Put another way, CMOs can develop the conversation beyond cost synergies and merger savings towards a demonstration of what their team does that is scalable and delivers growth. This is good practice for any function even outside a merger scenario.
Expect enquiries of the effectiveness of processes including client feedback and relationship review programmes, bid management, thought capital research reports, the effectiveness of practice and industry groups, the firm’s client communications and the quality of its client contact databases.

Nowhere is this more important than in the design and effectiveness of the firm’s Account Management approach. For this element – and the second challenge for CMOs - expect questions about your chosen approach, methodology, scalability, ROI and how you have designed account management to manage client-related risks and deliver the revenues for which every merger hopes.

The third challenge for the CMO, is to support client service delivery during and after the merger period. A first step is to develop with partners, an agreed communications strategy about the merger’s implications for clients – and its opportunities. This messaging will need to address each of the most common concerns of a firm’s clients in these circumstances (see insert box). External and internal staff communication will need to be aligned across both firms to convey a consistent response to the likely questions they face from clients.

In all these aspects, the CMO is best placed to bring the client dimension to assist management’s deliberations. Many mergers are defensive or reactive. Some, in the current business environment are ‘distressed’. But the responsibility of the good marketing professional is to ensure that a Client Centric approach is taken in post-merger integration.


The questions clients ask following the merger of their professional adviser:
Analysis of conversations with buyers of professional services General Counsels, CEOs and other strategic decision-makers reveals the issues which clients have and which management needs to consider in their post merger plan:

1. Are there any potential client conflicts which result from the merger and how will these be dealt with?
2. How and by whom will key client relationships be managed going forward?
3. How will the newly merged firm ensure that the quality of client service is not disrupted?
4. Will there be any adjustments to panel arrangements?
5. What additional areas of expertise, opportunity and added value does the merged firm offer to clients?

Source: Gulland Padfield - Client-Centric Strategies for Successful Mergers, 2013.


For the international merger, there are several Client Centric aspects which a CMO’s post merger strategy should aim to deliver.

  1. If a merger is concluded to address weak revenue growth in one region, the marketing team can help partners appraise and deliver cross-selling potential of existing client relationships in another stronger region of growth. Guidance for fee earners to help the new firm achieve ‘geographic leverage’ is useful.
  2. Where clients with international breadth want advisers to mirror their operations’ global footprint. The CMO must pre empt clients’ growing intolerance for inconsistent service delivery in different offices and regions. The answer is to develop a service consistency framework across the business. Engage all functions in all parts of the business - both client-facing and support teams to create this common service framework.
  3. In a tough economic environment, clients continue to seek cost savings and synergies and want the option to manage advisors with fewer client-side touchpoints. This prompts requests from clients in a post merger context for a more integrated account management approach. Pre-empt clients’ calls and set about agreeing with fee earners how common clients should interact with the new firm.
  4. The use of CRM and contact management has improved among leading advisory firms in recent years. But as two advisers merge, the CMO will need extra energy to communicate and roll out CRM to new colleagues across the combined firm. Success here has a multiplier effect on other aspects of the marketing activities.
  5. Newly merged firms will want to demonstrate their additional local market expertise – something which many clients appreciate strongly. The CMOs challenge is to identify where this local or regional market knowledge is and deliver it with the benefits of the new firm’s international reach and expertise. All aspects of a client management approach cannot be imposed from the centre. To be effective, the approach must be designed and rolled-out with input balanced across central management and local teams. Local offices need to share their understanding of regional variations in client expectations.

“Many mergers are defensive or reactive. Some are ‘distressed’. The responsibility of the marketing professional is to ensure that a Client Centric approach is taken in post-merger integration.” James Edsberg – Partner – Gulland Padfield

James Edsberg is a Partner at Gulland Padfield which provides strategic advice, interim management and consulting services to professional services firms and financial institutions in EMEA, the United States and Asia. He is the author of Client-Centric Strategies for Successful Mergers, 2013.

This article was also printed in the April 2013 Issue of PMForum magazine.

*Source: PwC’s Law Firms’ Survey 2012

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