Acquisition Series | Finding Alignment Before, During and After an Acquisition
There are a lot of moving parts during an acquisition, and it is easy for alignment to fall by the wayside. How do you actually ensure that a new product, and product team, aligns with your internal vision, processes, and methodologies?
Our series on managing product through acquisition continues with a look at some various perspectives on the subject. We talk with a few different product leaders whose experiences shed light on how acquired products should align from a brand perspective and how to effectively graft new product teams into your existing architecture to ensure success for everyone.
In this episode, we share some insights from those with real experience in product acquisitions and discover that maybe the answers aren’t always as obvious as they might seem.
Listen in to hear part two of our series on product acquisitions.
Past Episodes Mentioned:
- Adobe’s Scott Belsky on Leading with Conviction
- Reexamining Your Product Portfolio to Better Serve Your Users
Resources Mentioned:LISTEN NOW
Anna Eaglin: Welcome back. Today on Better Product, we are continuing our series on managing products through acquisition. Last week we kicked things off with a great conversation with Mimi Wayne as she shared what she learned from her experience going through Genesis Acquisition of interactive intelligence in 2016.
Christian Beck: Are we recording?
Anna Eaglin: Better Product, the only show that takes it behind the scenes look into how digital products are created.
Christian Beck: The businesses built around them and how you too can innovate better product. I'm Christian.
Anna Eaglin: I'm Anna.
Christian Beck: Welcome to today's show. I really enjoyed our chat with Mimi and one of the reasons I'm so excited for this series is because of the variety of perspectives we've heard on the subject over the past year. Anna, what are some of the conversations we've had that come to mind when you think about alignment after an acquisition?
Anna Eaglin: Well, I think Amy Reitz from Hobsons one that she had a really interesting perspective, especially coming into a company that already had a pretty extensive portfolio and we kind of pulling back the number of products they actually had.
Christian Beck: Yeah, I think she was the one that almost inspired us to even do this series and then after that we started meeting more people that got us thinking more about like, "Okay, we've talked about products that are building up to this point, what happens after that? What if everything changes?" At least a little bit. So what are the main things in your mind, if you were overseeing a product portfolio and a... What would be the main area that you'd be focusing on?
Anna Eaglin: Well, one thing that we talked about last week was.... I think team and culture and that's a huge one. You bring in a whole new team, you bring in a whole new culture, how does it fit in with what you have currently going? What do you want to keep? What's working with that team versus what do you feel like is working with your own internal team? But so you and I talked about a little bit was the kind of product marketing and product messaging side of bringing in new product. And I know that something you've had firsthand experience with Christian. So what about... What are some of your thoughts around that?
Christian Beck: Yeah, I think the big issue that you touched on is like... And we... And I think every guest is kind of talked about having the one vision that everything rules under. And Amy talks about that a lot with Hobsons where they have this core mission that everything falls in. So I think just like a startup has to start with a core mission and a core vision, it's the same thing when you're acquiring products. I think it's the first thing you look at. So in my background when I was designing for Autodesk, they have... AutoCAD is their flagship product and they have dozens of products and I was on one of the protocols.
Christian Beck: My experience as a UX designer at that point was actually designing on one of those protocols. But then I was sitting in the room as they made a few more acquisitions of other products and it is really challenging, it's challenging for both parties, it's challenging to be acquired, and then it's challenging when you're sitting in the room trying to figure out how you fold things under. And if I could go back in time with what I know now, I'd be guiding the room and guiding my design team to say that, "Let's take what's the core vision." Because that doesn't change after an acquisition and then figure out how we start to align everything there. We do that a lot in our own work with design.
Anna Eaglin: Yeah, we do. And I think one thing that we've done in the past is, a lot of times you have disparate products, they have different code bases, tech stacks and things like that. One way... One thing that we've done to make a product feel... why most of products feel more holistic is we've applied a similar design system across. And you can't always do it down to 100%, sometimes there are different interactions and different products and different naves for the most part, if you can visually align products, your customers can really start to feel like they are part of a family even if they're a little bit different. And some of those kind of specific interactions.
Christian Beck: Yeah. And visuals can be superficial or the only part of it or the tip of the iceberg. Whatever metaphor you want to use but it is a good spot to start because we are visual and when you start to see things aligned, it starts to make everybody feel like you're all on the same team together. Now the reality is this process can take a really long time.
Anna Eaglin: Oh, for sure.
Christian Beck: Especially if you're doing this over and over. If acquisition is part of your strategy, bringing things into the fold can take a long time. So the timeline for these acquisitions can range from... I would say three months to realistically years. So I think what... When you think about how long something's going to take, you're thinking about, "How do you align the culture? How do you align the products?" Those can take months alone. And then once you have all that in order, you now have to think about, "How do we align all their products together around that core vision?" Thankfully, we've got Amy Reitz to guide us in that way.
Anna Eaglin: Yeah. Let's dive into a few stories that show the various angles of product and product team alignment and how there isn't necessarily a one size fits all approach.
Amy Reitz: We reached a point as a company where we had something like 81 products on the menu of products that we provided. And among those products, there were a lot of conflicts. The story didn't make sense, the positioning was in conflict. Some of those products were winners, some of them were not, but they kept continuing on. And we realized as a company that it was time to really take a hard look at this expansive product portfolio we had and determine, "Where can we be differentiated in the marketplace? And how do we optimize our portfolio in a way that tells a common story?"
Anna Eaglin: That's Amy Reitz, General Manager of the Intersect product line at Hobsons, a solution that enables educators to improve college and career planning, admissions management, student success and advising. I think it makes sense to start this conversation about alignment with Amy, because as you just heard, they had a serious alignment problem not too long ago. Hobsons made a number of acquisitions to expand their product line and capabilities in recent years. And the company grew because of it. But at a certain point they reached a critical mass in terms of products and many of them no longer made sense and created a conflict and how Hobsons is trying to position themselves. As you just heard Amy share, they had to examine their product portfolio and make some decisions about how to move forward. So the answer seems clear when you have too many products, you get rid of a few starting with the ones that are making money. Simple as that, right?
Amy Reitz: I think we had taken this strategy of diversifying our product portfolio and there's a lot of parallels there to investment banking and diversifying a portfolio. But when it comes to pairing that down, you can't pair it down the same way you do in investment portfolio. So you can't just look at which product lines are making money, it's a lot more to that. So I think there was absolutely an analysis at the beginning to try and really take the financials of the business, allocate them to each of the products, and figure out what were the financial dynamics. But then beyond that, a lot of strategy sessions around, "What is our story and vision and where can we differentiate ourselves? And which of these products has the most potential to be able to do that?" It was also looking at the market and how is the market changing in such a way that we have an opportunity to really get on the leading edge of some things before our competitors do.
Anna Eaglin: For Amy and the team at Hobsons, aligning their bloated product line wasn't easy as it might seem on the surface. Instead of asking which products weren't turning a profit, they instead asked which products weren't aligned with the mission and the vision of the company. That ultimately led to some pretty important and clarifying conversations about who Hopsins wanted to be. The result of those conversations gave Amy and the team the direction they needed to establish clear product lines, keeping the products that made the most sense to best serve their customers and realize the true vision of the company.
Amy Reitz: Yeah. I mean, the difficult thing is... So now we're at a place where we have three clean product lines within those product lines, there's multiple products, but they all sit within a platform and a market strategy. If I actually look back at those 81 products, and a big part of what was challenging is that there wasn't a clear brand architecture there. So there were some things that you could say... we're roughly serving higher ed admissions, but some of them had different sales teams and marketing teams and support teams. To some degree the byproduct of a company that was rapidly growing over a number of of years and adding things on over time, some of it had become a little bit of a patchwork and would be really hard to define into product lines.
Anna Eaglin: Alignment after multiple acquisitions at Hobsons meant getting clear about who they were and where they wanted to go. And that's one piece of the puzzle. But I want to introduce you to someone else who experienced their own version of alignment, post-acquisition that had much less to do with the actual products. This is Emily Washington, Senior Vice President of Product Management at Infogix, which was a powerful, easy to use enterprise data intelligence platform, allowing you to govern, manage, and leverage data as an enterprise asset. As you are about to hear, Emily has seen her fair share of product acquisitions during her time at the company.
Emily Washington: I've been with this projects for about 17 years now and the product portfolio has grown quite a bit over the years. I mentioned we'd about four or five products when I started and now we're sitting at about 15 through both organic and inorganic beans. As we have a move from being founder owned to private equity held, we have incorporated more of an MNA strategy as a part of our growth. And we... over the past two years we've been through four acquisitions which has really helped broaden and deepen our product capabilities and with that came a lot more growth in the concept of product management and managing the life cycle of products, all the release cycles and roadmaps and so forth. And so the product organization has really grown with the capabilities, with the acquisition...
Anna Eaglin: One of the things I found fascinating while talking to Emily was her perspective when it comes to methodologies. Specifically, when you've done things a certain way over the course of 17 years and you acquire a new product team that approaches things differently than you, what does that look like? It's something that Emily has experienced time and time again.
Emily Washington: What's interesting is Infogix, given how long we've been around we... We've been a waterfall development methodology focused for so long. We have very long time stable products... You can take of them on being on maintenance mode, they work for the customers, we provide incremental releases and that landed itself to more of that waterfall type of development methodology. As we've made acquisitions over the past couple of years, there's smaller SAS based type of offerings that are agile and we release monthly or every couple of weeks and the organization has to adapt to that agile mindset. So we always joke that, "We're... We have a startup organization built into this very mature stable organization." And being able to bring those methodologies, the development methodologies as well as how to manage the product life cycle has been interesting because depending on the state of maturity of the different organizations, we've acquired companies that are five people that are very agile, right?
Emily Washington: Any customer requests that comes in, we'd go ahead and enhance it in a very agile manner and then you deal with Infogix where we have annual releases and it is more of that waterfall methodology. And so as we look at managing product portfolios, we move forward and how we go to market with the various products, there are some that really we lead with, our sales team will lead with to take to market and those we need to be able to adapt the methodology across the different organizations. And in some ways that's a huge opportunity for us, we take a lot of the best practices from the organizations that we've brought into the fold, but as you can imagine that also raises some challenges. How do you streamline the methodology and the processes and getting the different teams to adopt different aspects of what works in other areas.
Anna Eaglin: And that's really the question, right? You might assume after all of these experiences, Emily has finally found the right way to streamline these processes and methodologies. But that isn't the case because for Emily, the answer is that there's not one right way. In fact, they learned something with each new acquisition that evolves the process of alignment at Infogix.
Emily Washington: It's a continual improvement. There is no magic bullet, and from the time the company comes into the fold, it takes roughly six months to a year to really get it all buttoned up in terms of the process. But I'm happy to say after four acquisitions in two years, we've really been able to do that and we're all marching to the same tune at this point. And so... and the more of these that we do, the more we start to see how best to go about it the next time around lessons learned and how do we bake that into our processes we keep going here.
Anna Eaglin: Talking with Emily, you really get a sense of the balance she's discovered through her experience. And by giving herself and her team flexibility to grow and learn through the acquisition process, they found that alignment is less of a destination and more of a journey. But that wasn't always the approach, what would she do differently if she could go back to that very first acquisition she was a part of?
Emily Washington: With the first acquisition, you don't know what you don't know. I know we all say that, but that was a classic case during the first acquisition. We knew exactly what product capability we wanted to bring into the portfolio and we were so excited about the product that we acquired in that first acquisition. What we hadn't anticipated was the process and the functional integration of that. How do you take that waterfall development methodology, this long standing company that Infogix has been and then all of a sudden you bring up, for all intents and purposes, a startup with the... a team of five, very tightly knit, very agile and an entirely SaaS-based offering. It was... It's hosted within our environment, there's no concept of deploying a product on premises which was very different than Infogix previously.
Emily Washington: And so being able to bring those concepts together, those product capabilities into a single organization and tell that cohesive story that makes sense to existing customer bases on both sides as well as the market in general. There was a lot of trial and error in that because we had to bring this really large company in relatively speaking, this is a very small one and how we approached releasing product into something that made sense for the whole organization. And that's where... We ended up having to go through some iterations and how we manage the process, the release cycle and so forth that really... it took a little bit of time, but once we found our groove, it was... It started to work really well and we were able to take that to subsequent acquisition.
Anna Eaglin: I love that perspective because to Emily's point earlier, maybe there isn't one magic bullet that works for every company every time. And Infogix's approach to learning from each subsequent acquisition has benefited not only from their internal process and the experience where their product teams, it's helped them understand when an acquisition makes the most sense. And to that point, the next story I want to share with you is a prime example. In our last series on community, you heard from Scott Belsky, Chief Product Officer at Adobe, but before that he was a creator of Behance, an online platform to discover creative work. Scott's experience is one of being acquired. Something we'll hear more about in our next episode, but for now I want to focus on this idea of alignment because for Behance, their acquisition by Adobe made sense. Specifically because of their alignment in terms of product and mission was so obvious.
Scott Belsky: From a product perspective, we really wanted to nail the attribution opportunity. We wanted to know who was doing what. And we felt like getting into the creative tools themselves was the ultimate way to do this. And so we always really wanted to work with Adobe and we wanted to integrate into their products. And we actually had four years of various versions of the discussion around partnerships. And they always kind of failed because it was like all or nothing, it was very clear that it was just like a little bit too deep of a relationship to have as a third party. And so that was always what was stopping us from working with Adobe in a meaningful way. And then when the Adobe decides to make this transition from software to service, decided to deliver its products with fonts embedded so you could replace missing fonts and library is connecting so people could use the same assets across teams and across apps.
Scott Belsky: And it became clear that community was also one of those services that could integrate into the products and really strengthen the offering. And when... And once that transition happened, the Behance opportunity became more clear, not only to Adobe but also to us. And I started getting excited about it. I was like, "Wow, I think these tools can be a lot better." And I think that the service opportunities pretty exciting and we had a lot of experience building a service and a lot of our future colleagues at Adobe did it.
Anna Eaglin: That experience really set Scott up for success at Adobe and he has seen a few more acquisitions since then. The one thing that stands out and was obvious to him early on is that, alignment is really about people, and because people are well, people, there is no golden rule that tells you when and where you should expect to find it. That's part of the challenge, but it's also what made his very intentional approach in Behance and his leadership at Adobe's such a success.
Scott Belsky: Well, at the end of the day, a company is just people, right? And I always like to remind anyone who says, "Oh, big companies can do that." It's like, "Hey, it's just people." Like every startup is people, every big company people in either you have people aligned around a vision or you don't. And I've seen startups that have really crappy alignment and people are not... don't share the same values. And I've seen big companies that are great at it. So what my challenge is now in my role at Adobe is to get alignment across all of our products and to allow them to practice their values. And it's easier with some new products like Behance but it's hard with a product that's 30 years old, it's like a Photoshop. And that's part of the challenge.
Anna Eaglin: We've heard some varying perspectives on the alignment during and after an acquisition, but it seems clear that perspectives may vary depending on which seat you're sitting in. So what are the major differences for those being acquired versus those making the acquisition? How do both sides approach these major and sometimes complicated events? That's what we'll be diving into in our next episode. Talk to you then. Thanks so much for listening to the show this week. If you haven't yet, be sure to subscribe, rate, and review this podcast and until then, visit innovatemap.com/podcast and subscribe to learn how you can take your product to the next level. As always, we're curious, what does Better Product mean to you? It is up on twitter @innovatemap or shoot us an email at email@example.com.
Christian Beck: I'm Christian.
Anna Eaglin: And I'm Anna and you've been listening to...
Hosts: Better Product.
Anna Eaglin: Drop mic.