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The Cyber Jack Podcast: The Ingredients for Successful M&A - Sue Johnston, Juniper Networks

The cyber industry is notorious for merger and acquisition activity. Some go well, some come with collateral damage -- loss of employees, poor technology integration and leadership friction. Getting it right is a sweet science.

In this episode of The Cyber Jack Podcast, we sat down with Sue Graham Johnston, VP & GM of AI-Driven SD-WAN at Juniper Networks, to talk about coming over from an acquisition and how she and the Juniper team have navigated the M&A waters successfully to benefit network security technology innovation, customers, partners and employees.

[automated transcript for your accessibility and reading leisure]

Jack 00:04

Today, Sue Graham Johnston, VP and GM of AI-Driven SD WAN at Juniper Networks, joins us to talk about how to have a successful M&A in cyber and retaining top talent. All this and more on The Cyber Jack Podcast.

Sue, thanks so much for speaking with us. Excited to hear more about your experience in mergers and acquisitions. To kick things off, can you tell us a bit about your current role in Juniper, and how that role has evolved since the acquisition of 128 Technology?

Sue Graham Johnston 00:41

Absolutely. And Jack, thanks for having me on. I'm definitely excited to be here. So, I am the vice president and general manager of the AI-Driven SD-WAN business within Juniper, which is part of the overall AI-Driven Enterprise team. At a high level, my responsibilities are very similar to what I had as president of 128 Technology. And that's namely accelerating the growth of a disruptive networking technology into the market. I would say the most significant change is that becoming part of juniper has given me you know, huge global reach a marquee brand, and a game changing portfolio of products across cloud, AI and security to integrate with. So for me, it's really supercharged, the team's ability to accomplish our goals. And as a leader, it's changed what I need to do into the team. So not only setting the strategy and executing that with my direct team, but really engaging the 1000s of people at Juniper. And Juniper has customers and partners as well to be able to understand our products understand our strategy and execute across the globe.

Jack 02:01

That's great. So, let's talk a little bit about one of the toughest parts of M&A: technology integration. How have you been able to quickly bring 128 Technology solutions into the fold at Juniper? And what have those results been like?

Sue Graham Johnston 02:16

There were probably three keys to our overall success within juniper. First is a shared vision, second, clear priorities of what we wanted to accomplish. And third, really compatible entrepreneurial cultures.

So, I want to start with juniper and 128 Technology having a shared vision. If both companies were focused on creating the best possible user experience, Juniper is really the leader in experience first networking. And at 128. You know, we were very focused on a technology using sessions, because sessions are the thread that really binds together everything about the user experience. So, we could deliver a very different experience with SD Wan than any other solution out there.

And what was great when we started the acquisition process was from the first demos and discussions that we had together, it was clear that we could create something completely unique, completely unique in the industry, for client to cloud user experiences by bringing our teams and our technologies together. And when we first showed demos to each other and started talking about our approach, and how the technologies could fit, it just generated tremendous excitement for both companies, and really made us want to work together.

Secondly, we had very clear priorities post acquisition. And so one of those priorities was really to integrate our session smart router with junipers, mist AI, and bringing those two products together, made both products better. I joke about it's like the old Reese's Peanut Butter Cup commercials where Juniper had chocolate and we had peanut butter. And both are great, but they're better together. And that's actually tremendously hard to do in an acquisition. Because you, you can bring the two parts together, but you don't necessarily create that Reese's Peanut Butter Cup. And what's been incredibly exciting for us is that within weeks of being part of juniper, we were able to get our first technology integration is up and running. And through the course of this year, we've been releasing the product as an integrated holes. So you can now see and customers can experience this client to cloud solution with, you know, unmatched insights and automation. So, from the theory and the vision, we got very quickly into a priority across the development teams to make it happen. And so now customers get to experience these insights into their wins served up with this great AI engine that we got to bring into our product fold. And that one piece of integration is increasing the value proposition for both juniper and 128 Technology customers and partners. And there's a lot more coming. So having, you know, having the vision and then having the clear priorities and delivering that execution.

But I would say the third thing that was done well, and that is probably the most elusive, is actually understanding and capitalizing on the, you know, the culture. So I've been through a number of M&A in my career. And that cultural compatibility is one of those keys to success, and it is really hard to quantify. At Juniper, we joined an intensely entrepreneurial team in a company that was already on a mission to transform itself and the market. And just the way our teams mesh, and having that shared bold vision that we started with, has been a catalyst to having a successful integration. And the last point that I mentioned is Juniper learned a lot from the missed acquisition, along with other acquisitions that the company had done. So Juniper itself, and specifically the team that we became a part of, were able to integrate those lessons learned into a successful game plan and approach to integrating 128 Technology. And we all really benefited from that experience.

Jack 06:42

Interesting. So it sounds like all the stars kind of aligned for you. Now, during an acquisition, employees are often really concerned about their jobs and what their roles might be in a new organization. How do you set their minds at ease and keep top talent on board?

Sue Graham Johnston 07:01

That's a great point, Jack. And having been through a couple of different acquisitions, both being the acquirer and being acquired, you just have to recognize that change is hard. And the ambiguity created by an acquisition, it presents a significant risk that you're going to lose key talent. But that being said, there are several strategies that I've put in place that help.

The first is really timely and transparent communication. And for me, as a leader, any leader going through the M&A process, you just won't have all the answers. But letting the team's know what you can tell them, as soon as you can tell them reduces the ambiguity and stress on those individuals and helps you work people through it. Now, we benefited from the fact that we already had a strong culture of transparent communication at 128 Technology. And in fact, during the pandemic, when we were in, in lockdown, we moved to every other week, whole company meetings, just to keep everybody on the same page with what was going on. And so that openness helped tremendously as we were going through the integration, because I'm sure you can appreciate and others.

When you go through M&A, particularly with a public company, like Juniper, there are things that you can tell the team and there are things that just can't be known until you get through the other side of all the regulatory approvals, and the necessary processes that have to be in place before the two companies can combine. But that said, there's a lot that you can share. And the more you can help create clarity for your team through the process. the better off you'll be. You know, I talked in the last question about having clear priorities.

One of the clear priorities that Juniper had was they understood the value of the team, and that keeping the team was one of their key reasons for acquiring us. So, you know, this process of valuing the employees and saying, like keeping the team through an acquisition has to be more than just, you know, words from the executive team. And Juniper did a tremendous job of really making that value for the employees felt in the process of transitioning us to part of juniper. So it was backed up by the process of, you know, every single person on the team got a job offer, just the welcoming nature. And keep in mind, we were doing this integration through the pandemic so people actually couldn't meet each other face to face. But the Juniper team really embraced the 128 team. And then finally, I'd say the clarity of the integration priorities were having one of the top three goals being to keep the team you know, made it clear that that was a value that was an imperative. And that was part of the definition of success of the overall acquisition.

And we were incredibly proud as a leadership team that every single person at 128, technology joined juniper. And virtually all of us are still here one year later. And that is not typical. So to put it in perspective there, you know, there's a ton of studies about how to do effective M&A. But there was a recent one from MIT that found that about a third of acquired workers leave within the first year of their startups purchase. And I would say that's more typical of the experience so that we've kept nearly the whole team through the pandemic, through the integration through an acquisition is just a testament, I think, to what was done well, and the faith that the employees had in, you know, the the understanding of their roles, the understanding of the value that the organization placed on them joining and growing their careers with juniper.

Jack 11:03

That's some really good advice for organizations looking to build relationships with their employees during an M&A event. What was the most surprising thing you learned during the acquisition and integration process?

Sue Graham Johnston 11:16

From my perspective, most M&A integrations tend to fall into two camps. I'm sure you and many of your listeners are Star Trek fans.

So one extreme is your the Borg, you know, you will be assimilated, the company acquiring you has one way of doing business and you get fully integrated into the company process. The second is, it's an arm's length, like you're a wholly owned subsidiary, you keep doing what you were doing, you're just now in a different corporate structure. And from my perspective, neither of those approaches is really the right way to go about it. And if you take the first the like Borg, you will be assimilated process, you risk losing really the special sauce of what you've bought, which is there, you know, this unique value proposition of how the company you've acquired, operates and generates their value. In the second, you know, you miss all the positive synergies of what you can do together. And you really have just created kind of a holding Group of Companies.

What I thought worked particularly well, at Juniper was Juniper was really thoughtful about making a balance between making sure we were integrated successfully into juniper and and keeping what was unique to our business processes, but also trying to minimize operational complexity. So if something could be changed, to align to how Juniper did business, we should do that. But what was even more pleasing was Juniper not only wanted to keep the aspects of the 128 Technology business that made us successful, but also look to integrate those elements into junipers, existing business to help the broader Juniper on its transformation journey.

So I think it was a great coming together of a, you know, a much larger company looking to see how do we, you know, how do we make this acquisition flourish within our business? But more importantly, what can we learn from this acquisition to really help Juniper as a company, create new value in the marketplace? And like I said, I think that's very unique, because most M&A is I've seen really fall into, you know, either the leave it alone and just let it be, or the totally assimilate and, you know, our way is the way it will happen.

Jack 13:53

Yeah, that makes a lot of sense for success for an organization that has just acquired valuable talent and technology from another. So final question, and an opportunity to summarize this for our listeners. What kind of advice would you give a company that has just been acquired? And what are some tips for making that transition as quick and easy as possible?

Sue Graham Johnston 14:14

There has to be a recognition from the beginning that there will be setbacks in the process. You know, taking two companies that operate differently and putting them together just invariably results in areas that will break or cause disconnects. So think the first thing to keep in mind as a company that's being acquired, is integration has to be a process.

You will almost never get it right at the beginning. So you have to start with a set of priorities that will drive value in the near term, motivate the team, and then continue to have a process that helps you work through the challenging issues and the things that break as you're trying to lead. To this rapid scaling of the business, and as I outlined in, you know, the other questions that we talked about Jack, I think there are a couple of things to keep in mind. You know, one is that check for cultural alignment, it is elusive, but it's incredibly important.

And you have to make sure that it's really lived, not just spoken. The second one is prioritize integration goals, be clear, be consistent, and be relentless on achieving them. Third, for me, is really make sure the employees feel valued. The bulk of the asset you've acquired is actually the people on the team. Fourth, and where I think Juniper has done a great job is seek out the best of both companies really embrace and implement the aspects of the acquired company that were successful. And the last one, and I think, you know, part of just by year of reflection on the business is, you've got to have fun. No, integrations are a lot of hard work, but celebrate, enjoy and recognize the team on both sides for a job well done.

Jack 16:05

There it is. Sue, thank you so much for coming on the show and sharing your expert advice for a successful cyber M&A. To all of our listeners, we'll see you next time.



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