When M&A transactions are completed, the deal may be completed, but if companies fail to begin post-closing integration properly, they can be missing out on significant value. The most difficult and time-consuming M&A task is merger acquisition integration. A solid team that is well-functioning as well as clear communication, and a solid plan are vital to ensure the success.
Many of the challenges that companies confront during integration can be prevented by pre-integration planning. For example, integrating systems requires careful consideration of data ownership, process synchronization and other issues. It is essential to have early IT solutions to allow http://www.virtualdataroomservices.info/what-is-deal-flow-management the new unified business to realize benefits quickly. Planning should begin during due diligence and the PMI Framework should be finalized before the transaction is completed. Furthermore, the most important factor to success in PMI is identifying and tracking the key integration milestones in order to monitor progress and keep an eye on the desired outcomes of the transaction.
A common mistake is to integrate too excessively. This can be detrimental to the value of the acquired business by altering the elements of the acquired business that make it attractive. Additionally, companies who acquire underestimate the amount of time it takes to successfully integrate a acquired company.
Another common error is to not examine the culture and norms of work thoroughly enough. For instance, if workplace cultures of two companies are completely different there could be conflicts. To avoid this the acquirer could begin the evaluation at the due diligence stage by inviting key individuals from the target company to assess their work habits and culture. This can be a very useful method to determine the type of integration strategies which will be required after the deal is concluded.