Compaq Computer Corporation and Digital Equipment Corporation formally joined forces on June 11, 1998, creating a $37 billion (US) personal computer and computing services firm. The merger was expected to generate synergies that would lead to cost take-out and cross-selling opportunities. In order to generate these benefits, however, management of the combined firm would have to overcome the challenges presented by two very different management styles, cultures, organizational forms, and technology infrastructures. This case describes the challenges from the perspective of the two firms' IT units. It explains how IT leaders from the two firms cooperated to deliver an ambitious set of Day One goals, and how they worked through ongoing challenges during the eight months immediately following the merger. It offers lessons about the role of technology in facilitating merger-induced organizational changes and serves as a reminder of the importance of strategic direction in setting the IT agenda.
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