I was having one of those “why doesn’t this work” days that is a routine occurrence in the field of technology when I got a call from a client, the CIO of a major, US (global) corporation. Reaching his office, I heard the familiar, “We’ve just announced the acquisition of a new company and I want plans, people and operations in place to manage the transition no later than next week.” Big announcements like this are not always acquisitions, but they are usually disruptive to the tasks at hand! That day, at least, it was (temporarily) a nice distraction!
Mergers & acquisitions are predicted to continue as a strategy for American business growth. Some of the most common reasons cited for M&A include increasing shareholder value, achieving operational or financial economies of scale through lower unit costs, and acquiring new products or markets that have been created as a result of rapid technological change and innovation. Those are all worthy goals, however, we all know that not all M&As have successful outcomes.
Through research and my experience on three acquisitions in the past four years, I’ve found that there are some important M&A strategies that contribute to success and sustainability. My key recommendations are:
- Involve the transition leadership as early as the due diligence.
- Together, craft a strategy that begins with the end result in mind.
- Have a great communication plan.
- Move aggressively to complete the merger or acquisition.
Strong strategy, team collaboration and communication contribute to greater returns on the acquisition investment. Here’s a tip: those same factors may allow you to uncover new innovation opportunities you didn't anticipate.
For a longer list of recommended practices and ways to uncover innovation opportunities, email me.
Comments