Inadequate post-deal integration practices are the main reason for M&A failure. DealRoom assists companies to avoid common mistakes and increase the value of their M&A deals through the post-acquisition integration process.
The emphasis, sequence, and pace of integration post-deal should be tailored specifically to reflect the goals and sources of value that warranted the deal in the first place. It may seem obvious, but many companies rely 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 did, for instance. It recognized 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 growth instead by leveraging the capabilities and sales channels of the new company in a strategic way. They then had to reconsider the decision to fully integrate R&D in the future.
One of the key strategies for successful mergers is to assign line managers responsibility for capturing revenue and cost synergies. This ensures that line managers have the appropriate incentives and responsibilities for driving strategic execution, and it helps to monitor progress against goals in real-time. We’ve also observed that it can help to create the capability to hold short sessions that are iterative, with a specific timeline and target which allows teams to adjust and revise their goals and efforts as they move through the PMI cycle.