Rapid Business Growth Through Mergers & Acquisitions

We see too many acquisitions stumble because the acquirer is so focused on realizing the synergies that they ignore the people issues, thinking that these will take care of themselves. The reality is, when a company is acquired, no matter how small, there is a very high degree of uncertainty and, yes, fear. And not only in the company being acquired but sometimes within your own company as well, as roles and expectations are altered and responsibilities shift.

Remember that growth through acquisition can be fast and furious — and very disruptive for the people involved. Your first days post acquisition are critical to ensuring that you have a successful integration and that the hoped for synergies between your two companies are realized.

Like a new US President, use your first days to lay out to everyone within your new organization your vision, strategy and initiatives that are required for this success. In a change environment, people are looking for clear guidance and action. They are expecting that change is going to happen, and this make them anxious. And each day that you delay addressing their concerns, they becoming increasingly more anxious and less productive. You should spend as much time mapping out your first days as you did in doing your acquisition due diligence.

While we see very few people who have the discipline to do this, those that do reap the rewards. People expect change when an acquisition occurs. For many entrepreneurs, the need to have their hands on all aspects of the business is in their DNA.

Promise and reality

If your are honest with yourself and realize that you have difficulty delegating key roles to others, then a strategy of growth through acquisitions may not be for you. Not all people can evolve to the next level. And growing businesses need more skilled people than stagnant companies do. Your focus post acquisition is often on paying down the acquisition debt. Consider the upgrading of your talent pool as simply another acquisition — an internal acquisition that could likely be your most successful.

On paper, these can look very exciting and can push you to do a deal. Experience tells us that actual synergies can fall well below anticipated synergies.

Stress test these synergies in a financial model back to your future debt service requirements - this will drive home the risks of overestimating the hoped for synergies. This may not be as easy as it first looks. Making sure that your two organizations are now acting like one and that your new customers fully embrace you will take longer than you think — so take your time and get it right. There are lots of potential acquisitions out there that are not going away. A disciplined, patient and methodical acquisition strategy is your ticket to success. A merger should be the result of carefully researched brand analysis.

It should NOT be an ego-driven trophy deal. Mergers and post-merger integrations are resource-intensive activities that usually involve some of the most senior people in the firm. If they are not prepared for it, they can easily be distracted by other critical, but less urgent activities. The potential for distraction is greatest—and most profound—after the deal is done and the focus moves to integration.

Mergers and Acquisitions as Part of Your Growth Strategy

If senior management gets too distracted, and you risk having the merger flounder as well as damaging the underlying business. The acquisition seems very strategic. The result is a confused marketplace. The whole confusing mess could be avoided with a solid, research-based plan to position the merged brand and help current and potential customers understand the rationale and benefits of the merger.

If the marketplace is confused, the strength of your brand will suffer. After all, brand strength is the product of a simple equation:. Understanding this equation can help you avoid the perils of diminished brand strength.

Growth through merger and acquisitions

An ill-timed merger can quickly diminish the strength of both the acquiring and acquired brands. Brand M, which has considerable visibility in the Midwest, wants to expand into the Southeast. To accomplish this, Brand M acquires Brand S, a southeastern-based firm. But there is a problem. The Midwestern brand is unknown in the southeast, so its overall brand strength is actually diminished by the acquisition.

And, when the southeastern firm adopts the brand identity of Brand M, its brand strength is also diminished. So how do you overcome this problem? Sometimes a gradual transition to a new brand is the right answer. Watch out for situations where you must change both the focus of the reputation and increase visibility. These are the most challenging mergers. Do your research and understand fully what each firm—the acquired as well as the acquiring—bring to the equation. It is forward-looking —A good strategy is not just a response to what has been.

Where do you really want your firm to go? How will you get there? What needs to happen to do it? It does require buy-in —Senior management must be onboard and embrace what needs to be done. Without management buy-in, any strategy is doomed to failure. It focuses on implementation —High growth requires careful implementation of every aspect of a business strategy and plan.

Follow through with implementation. And consider carefully how the merged firm will generate organic growth. This customized program will identify the most practical offline and online marketing tools your firm will need to gain new clients and reach new heights. Who wears the boots in our office? That would be Lee, our managing partner, who suits up in a pair of cowboy boots every day and drives strategy and research for our clients.

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Seeking a solution to a business problem There are essentially two kinds of mergers and acquisitions: Download the Rebranding Guide — Second Edition Strategic mergers and acquisitions offer a solution to a different business problem. Here are five situations in which mergers and acquisitions have proven useful as a growth strategy: Companies can take advantage of revenue synergies and make more money in many ways, including the following: Reduce competition Open new territories Access new markets through newly acquired expertise, products, services, or capacity Expand the customer base for cross-selling opportunities Develop sales opportunities by marketing complementary products or services.

Growth through merger and acquisitions | Deloitte Ireland | Strategy

When do mergers and acquisitions go wrong? Are they no longer an accounting firm? After all, brand strength is the product of a simple equation: In the end, a successful high-growth strategy will include the following elements: How Hinge Can Help: