M&A deals that fail usually due to inadequate post-deal integration. DealRoom helps companies avoid common pitfalls and maximize the value of their M&A deals through the post acquisition integration process.
The focus, sequencing, and pace of integration post-deal should be specifically tailored to serve the objectives and the sources of value that led to the transaction in the initial place. It may seem obvious, however many businesses are reliant on generic best practices and off-the shelf plans that focus too much on processes and ignore the unique aspects of their deal.
One company has, for instance, realized that R&D could provide a substantial amount of value, but as the product that was the main focus of the acquired company was still in development, they decided to focus on growing instead, leveraging the capabilities and sales channels of the new company in a strategic way. They would then reevaluate the decision to fully integrate R&D in the long run.
Another important practice in successful mergers is to assign responsibility for capturing cost and revenue synergies onto line managers in the newly acquired company. This ensures that line managers have the right incentives and responsibilities to drive the strategic execution of the merger, and also makes it easier to track progress towards goals in real-time. We’ve also observed that it’s helpful to create the capability to hold short meetings, iterative ones with specific targets and timelines that allow teams to adapt and update their goals and strategies as they progress through the PMI cycle.
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