Absorb the next acquisition without adding help desk seats

In 1997, First Union Bank bought CoreStates Financial. First Union lost 20 percent of its customer base in the first year after the purchase, according to Bain, the M&A consultancy. Bain says customers defect from a merged company when they stop getting consistent service. I think about that pairing whenever an acquisition gets treated as done the day the papers are signed.

What the deal actually changes at the desk

In our experience, acquired accounts arrive with habits already attached: who they’re used to calling for a meter read, how they’ve always ordered toner, whose direct line they have saved for a service call. Bain says customers expect consistent service across both merged companies from the start. If they don’t get it, they defect. Meanwhile your team learns the new accounts’ habits while still doing the job it had before the deal closed, on top of whatever volume increase comes with them.

One dealer we work with folded two acquisitions into the same team and was looking at volume going up 30 to 40 percent the next quarter. That’s one dealer’s number, not an industry average.

When volume rises faster than headcount

Dealers we talk to usually ask for headcount when volume rises like that, and the seats aren’t guaranteed, especially if the acquisition was supposed to help this year’s numbers, not add a line item to them. Without the extra seats, the added volume lands on people who were already busy before the deal closed.

Numerous studies, by Bain’s account, find that more than half of all mergers fail to deliver the shareholder-value improvement that was intended, and customer defections are part of why. Bain reports that one major US bank’s Net Promoter Score fell from 11.5 to zero after a merger, because customers felt overlooked. Bain also has the opposite example: when Westpac in Australia acquired St. George Bank, about a third its size, Westpac set out not to lose a single customer in the integration, and it didn’t. St. George’s customer base stayed stable, and its churn rate actually dropped. So the outcome isn’t fixed either way. I think it depends less on the acquisition itself and more on what a dealer does with the volume it brings, in the weeks right after close.

What doesn’t need to be a person

A lot of what spikes after a deal doesn’t need a person answering it at all. Meter reads are usually first (dealers we talk to rank them ahead of dispatch and toner), then service call intake, then toner and supply orders. Routine meter reads and toner orders don’t need the judgment a service exception does. The exceptions are things like a machine that’s been down all week, a new customer who isn’t sure about you yet, or anything that falls outside the threshold a dealer sets for what can go through on its own.

We built Auralis around that split: meter reads, toner and service calls handled around the clock and written straight into e-automate. One dealer we work with had about 80% of meter reads automated within two weeks of go-live, and end-customer wait time went from a few hours to a couple of minutes.

If you’re deciding whether to build that in-house or buy it, Build vs buy: how to add AI agents to your team sets the two side by side on time, cost, upkeep and who owns it.

Sources

• Laura Miles and Ted Rouse, Keeping Customers First in Merger Integration, Bain & Company, Nov 3, 2011.
• Auralis customer results (internal, anonymized).
• Auralis product information (internal).