One of the most important aspects of an effective merger acquisition is the integration phase. Integration of acquisitions is often ignored by companies, until it’s too late. It can make or break a deal. Whether the goal is capital, cost, or revenue synergies, acquisition integration is an enormous undertaking and requires a dedicated time to complete effectively.
A poor M&A planning and execution has led to many companies failing to realize the financial benefits of merging. The most important reason is lack of commitment and alignment within the leadership team that facilitates integration processes. The first step is to identify and elevate leaders with the motivation and skill to successfully lead integration efforts. This includes the M&A leadership team as well as functional teams involved in the process such as finance, human resources, operations, and more.
Another important aspect of M&A integration is to implement clear tracking mechanisms that link the process to the P&L. This means establishing clear KPIs that take into account the target company’s business model not just the acquirer’s. This ensures that http://www.virtualdataroomservices.info/best-data-rooms-for-fund-raising the correct measures are tracked and appropriate goals set.
Another consideration is to involve an integration director as soon as is possible. This can be done as part of the diligence process. It will optimize the target’s worth by identifying synergies that are not being realized. An effective integration director will be able to see these opportunities before the deal is completed and help ensure they are reflected in the target’s valuation.