Integration is a crucial stage in M&A. It also has proven to be one of the most difficult. In fact, a recent survey found that M&A companies are 12 to 18 percent less likely to feel that they have the appropriate capabilities and capabilities to integrate than other stages of M&A.
To overcome this challenge it is essential to communicate clearly the rationale for the acquisition and the strategies for integration. This will ensure that everyone is aware of what is expected from them and how M&A will benefit their organization.
It is also essential to follow the best practices that are tailored to the goals of the deal. For instance, using the same team of professionals who performed due diligence for the M&A for the post-merger great site integration assures continuity, avoiding duplication of efforts and reducing the time.
Another issue is maintaining momentum throughout the process of integration. It is imperative that the team of integration join the companies without sacrificing growth. In addition, it requires a solid understanding of the M&A business’s operational processes so that the team in charge of integration can make decisions that are least disruptive to day-to-day activities.
A strong governance structure is also needed to capture synergies and track them. This includes establishing the M&A leadership group (which should comprise representatives from both organizations) in addition to establishing and implementing an integration plan, and establishing clear lines of accountability. M&As that incorporate these integration best practices can yield as much as 6 to 12 percentage points higher total returns to shareholders than those that do not.