M&A deals that fail usually due to inadequate post-deal integration. DealRoom helps companies avoid common mistakes and maximize the value in their M&A transactions by assisting in the post-acquisition process.
The sequence, focus, and pace of post-deal integration must be specifically designed to support the objectives and the sources of value that led to the transaction in the initial in the first. It might seem obvious, but many businesses are reliant on generic best practices and off the shelf plans that concentrate too much on processes and overlook the specific aspects of their deal.
One company did, for instance. It recognized that R&D offered a lot of value, but since the primary product of the acquired company was in development, it chose to focus on growth instead by leveraging the capabilities and sales channels of the new company in a strategic fashion. They would then reconsider their decision to fully integrate R&D in the long run.
One of the key methods used in successful mergers is to provide line managers with the responsibility of capturing revenue as well as cost synergies. This ensures that the line leaders have the right incentives and responsibilities to lead tactical execution, and it also makes it easier to monitor progress against goals in real time. We’ve seen it’s beneficial to set up the capacity for brief meetings that are iterative, with clear targets and deadlines, so teams can realign their goals and activities as they move through PMI cycles.