How to Overcome the Challenges of Merger Acquisition Integration
In M&A integration, it is one of the most crucial stages. However it has also been proven to be the most difficult. A recent survey found that M&A firms are 12 to 18 percent less likely to think they have the necessary capabilities and capabilities for integration than any other stage of M&A.
To overcome this hurdle it is essential to clearly explain the reasoning of the deal as well as integration tactics. This will ensure that everyone understands what is expected of them and how the M&A can bring value to their company.
Additionally, it is important to follow best practices that are specific to the deal objectives. It is essential to utilize the same people who did the due diligence on the M&A deal for the post-merger implementation. This assures continuity and stops repetition of efforts.
Another challenge is maintaining momentum throughout the process of integration. The integration team must ensure that growth is not sacrificed when integrating the companies. Furthermore, this requires a strong understanding of the M&A company’s operations so that the integration team can make decisions that have the least impact to the day-to-day tasks.
It is also essential to have a strong structure for governance of integration to monitor and capture synergies. This includes establishing the M&A leadership group (which includes representatives from both organisations), creating and the implementation of an integration plan, and providing clear lines of accountability. M&As that implement these best practices for integration could yield between 6 and 12 percent more in total returns for shareholders than those who do not.
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