Merger and Acquisition
MERGER OR ACQUISITION
There are several critical success factors in a solid transition and integration plan.
Utilizing the elements of a recent client success as a blueprint for developing a solid integration plan, the following key points achieved the intended results:
1. Clarify the business model - surprisingly, many of the 80% of mergers and acquisitions that fail to achieve the intended results do not clarify their business model upfront and stick to it. This is a critical success factor, as it provides a clear vision for the organization. With a clear vision, individuals not only understand where the company is headed but they also are better able to contribute to achieving the vision. In my experience with mergers and acquisitions, I've been on both sides of this equation. In one example, the acquirer provided a clear picture of the business model to the acquired; however, the management teams of the acquirer did not have the same clarity. In this case, although the business model provided significant opportunities for synergy, it did not yield the intended results due to the mixed messages and unclear business model. In another example, the acquirer had a clear business model, initially failed in execution but was able to salvage the core of the benefits by re-invigorating and focusing on the business model. Lastly, in another example, the company had a clear business model and clear execution plan and achieved the intended synergies and bottom line results.
2. Keep the transition impact as low as possible - often underappreciated yet critical to success is keeping the transition impact as low as possible throughout the transitional period. When companies keep the transition impact low on employees, suppliers, customers and other business partners, it leads to a smoother and more successful merger/ acquisition. Specifically, this means achieving the following results on a daily basis:
a. Uninterrupted cash
b. Uninterrupted performance for
There are several critical success factors in a solid transition and integration plan.
Utilizing the elements of a recent client success as a blueprint for developing a solid integration plan, the following key points achieved the intended results:
1. Clarify the business model - surprisingly, many of the 80% of mergers and acquisitions that fail to achieve the intended results do not clarify their business model upfront and stick to it. This is a critical success factor, as it provides a clear vision for the organization. With a clear vision, individuals not only understand where the company is headed but they also are better able to contribute to achieving the vision. In my experience with mergers and acquisitions, I've been on both sides of this equation. In one example, the acquirer provided a clear picture of the business model to the acquired; however, the management teams of the acquirer did not have the same clarity. In this case, although the business model provided significant opportunities for synergy, it did not yield the intended results due to the mixed messages and unclear business model. In another example, the acquirer had a clear business model, initially failed in execution but was able to salvage the core of the benefits by re-invigorating and focusing on the business model. Lastly, in another example, the company had a clear business model and clear execution plan and achieved the intended synergies and bottom line results.
2. Keep the transition impact as low as possible - often underappreciated yet critical to success is keeping the transition impact as low as possible throughout the transitional period. When companies keep the transition impact low on employees, suppliers, customers and other business partners, it leads to a smoother and more successful merger/ acquisition. Specifically, this means achieving the following results on a daily basis:
a. Uninterrupted cash
b. Uninterrupted performance for