Culture is important in all deal types but particularly when you bring two large groups of people together. Then, the potential friction would be much more visible. And you need to understand the culture of both companies. It is not enough to say, is the target company compatible with us? You need to understand it in a more nuanced way. What are their ways of … [ Read more ]
Content: Quotation | Author: Becky Kaetzler | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
Designing, managing, and delivering a positive experience is especially important during the post-merger talent selection process—not only for employees offered positions but also for those not selected or who choose to leave. How the HR and integration teams treat the latter groups can have far-reaching effects on workplace morale and the company’s reputation as an employer of choice.
Content: Quotation | Authors: Becky Kaetzler, Jocelyn Chao, Laura Lynch, Natashya Lalani | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
Retaining critical talent and ensuring the right people are in key roles are essential to a successful merger.
Content: Article | Authors: Becky Kaetzler, Jocelyn Chao, Laura Lynch, Natashya Lalani | Source: McKinsey Quarterly | Subjects: Human Resources, Mergers & Acquisitions
Industries consolidate faster when the share of fixed costs is high. Slow-moving industries are those with few physical assets, such as restaurants, craftsmen, and medical care. Industries moving at a medium speed include automotive, aluminum, and food. Fast-moving industries have the lowest variable costs and high asset intensity, such as software, telecom equipment, and search engines.
Content: Quotation | Author: Jürgen Rothenbücher | Source: A.T. Kearney | Subject: Mergers & Acquisitions
You need to understand the sources [of M&A revenue synergies], and there are three places we can categorize. One is where you sell. That includes new channels, cross-selling to existing customers, geography expansion. Then there is how you sell. This is where the sales force effectiveness or channel coverage matters. Then there is what you sell. Is the deal bringing new products or new bundles … [ Read more ]
Content: Quotation | Authors: Andy West, Jeff Rudnicki | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
Research shows that active, efficient reallocation of resources creates better returns for companies than simply standing pat does. Here’s how to make portfolio decisions faster.
Content: Article | Authors: Anthony Luu, Obi Ezekoye | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
Companies divest assets for a variety of reasons, but many miss the boat when it comes to creating value from such events. In fact, more companies lose value than create value following a divestiture. Kearney’s ongoing research focuses on what separates the value creators from the value destroyers.
Content: Article | Authors: Godfred Hansen-Nord, Jason Wehner, Robert Haas | Source: A.T. Kearney | Subject: Mergers & Acquisitions
The M&A landscape has changed. Beyond market share and cost synergies, the value of M&A increasingly lies in transformation and growth.
Companies can’t afford to delay transformation for the sake of integration, as it freezes their ability to innovate while competitors surge ahead. Deal approaches need to change, allowing organizations to transform, and talent to flourish during integration.
Using deal intent as a guide, C-suite leaders can … [ Read more ]
Content: Article | Authors: J. Neely, Kristen Andrews, Tim Good, Yaarit Silverstone | Source: Accenture | Subject: Mergers & Acquisitions
A company needs to be really clear on why they’re acquiring something. If it’s an acqui-hire, then it’s the talent. If it’s a business-model acquisition, it’s the business, the technology, and the IP [intellectual property]. There are lots of different reasons. So first, be super clear on why you’re acquiring something. And then, I always like to say, there’s pitchers and catchers. The pitcher is … [ Read more ]
Content: Quotation | Author: Erik Roth | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
New research confirms that companies that regularly and systematically pursue moderately sized M&A deliver better shareholder returns than companies that don’t.
Content: Article | Authors: Andy West, Jeff Rudnicki, Kate Siegel | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
Large in-house M&A teams are no longer seen as the only game in town. Leading companies are taking charge of their M&A destiny by smartly combining internal and external resources.
Content: Article | Authors: Angus Hodgson, Lieven Caboor, Robert Haas, Soon Ghee Chua | Source: A.T. Kearney | Subject: Mergers & Acquisitions
At the start of a typical integration effort, the integration team uses the deal model and due-diligence results to identify opportunities and set synergy targets. But financial due diligence is seldom deep or exhaustive enough to provide a solid foundation for maximizing value because the effort focuses on justifying the deal, not on creating value (in other words, “figure out what to pay for the … [ Read more ]
Content: Quotation | Authors: Greg Gryzwa, Max Floetotto, Milind Sachdeva, Oliver Engert, Patryk Strojny | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
Substantial changes to an operating model are often necessary to achieve an organization’s strategic objectives and deliver the promised value of a merger. Making these changes requires a thoughtful, leader-driven process to navigate the unique constraints and risks of the endeavor.
Content: Article | Authors: Caitlin Hewes, Kameron Kordestani, Olivier Rigaud, Rebecca Kaetzler | Source: McKinsey Quarterly | Subjects: Management, Mergers & Acquisitions, Organizational Behavior
Creating value from a merger is not easy. Acquirers that get it right start with an overlooked advantage: a healthy organization.
Content: Article | Authors: Andy MacLean, Becky Kaetzler, Kameron Kordestani | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
To maximize deal value in a merger, focus on critical principles.
Content: Article | Authors: Greg Gryzwa, Max Floetotto, Milind Sachdeva, Oliver Engert, Patryk Strojny | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
Structured communications are vital to clarify what comes next in a merger, separate fact from fiction, and forge success for newly combined organizations.
Content: Article | Authors: Anish Koshy, Becky Kaetzler, Kameron Kordestani, Oliver Engert | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
Companies pursuing revenue synergies can’t take them for granted. Leaders need a clear grasp of where those synergies lie—and the persistence to capture them.
Content: Article | Authors: Alex Liu, John Chartier, Nikolaus Raberger, Rui Silva | Source: McKinsey Quarterly | Subject: Mergers & Acquisitions
There is a fault line where tensions often erupt in mergers. This fault line is what we call tightness versus looseness. When tight and loose cultures merge, there is a good chance that they will clash.
Tight company cultures value consistency and routine. They have little tolerance for rebellious behavior, and use strict rules and processes to uphold cultural traditions. Loose cultures are much more fluid. … [ Read more ]
Content: Article | Author: Michele Gelfand | Source: Harvard Business Review | Subject: Mergers & Acquisitions
Discount, premium, online-only, you name it: how a company “does business” is as important, or more so, than the geographic or product market in a merger. According to research by Timo Sohl and Govert Vroom, when two companies have similar business models, they make better partners.
Content: Article | Authors: Govert Vroom, Timo Sohl | Source: IESE Insight | Subject: Mergers & Acquisitions