A well-planned integration process for mergers and acquisitions will assist in increasing the value of your deal. This is a challenging process that requires a combination of operational expertise and finance, as well as change management and cultural knowledge to be successful. Those who get it right can yield up to 12 percent more returns to shareholders than those who don’t.
The company that is acquiring should begin thinking about the process of integration as early as possible during the diligence and negotiation phases. A thorough evaluation of the culture of target companies will help determine the best strategy for due diligence, top-management meetings and initial integration planning. In one healthcare acquisition, for example, managers used their initial insight into the target’s culture to make strategic choices about the assessment of synergies and the structure of teams for integration. They made tactical decisions such as limiting how many people were in attendance at the initial meeting, and limiting the number functional areas.
We have a methodological approach to capture synergies in large mergers that have been successful. This means placing line managers in charge of their goals and requiring them to be accountable for their outcomes. It is also about integrating synergies into leaders’ annual operating budgets and plans.
It is essential to have a team of management members that are integrated throughout the duration of post-close integration, which can be up to two years. The team should have the authority to act quickly and have access to all relevant information.