When M&A transactions close, the deal may be completed, but if companies do not initiate post-closing integration in a timely manner, they risk missing out on significant value. The most demanding and time-consuming M&A activity is merger acquisition integration. A well-functioning team as well as clear communication and a well-constructed plan are essential for the success.
Pre-integration planning can eliminate many of the challenges companies encounter when integrating. For example the process of integrating systems requires careful consideration of data ownership processes synchronization and other issues. Additionally, IT solutions must be designed in advance to allow the new company to rapidly reap the benefits. Planning should begin with due http://www.virtualdataroomservices.info/best-data-rooms-for-fund-raising diligence and the PMI Framework should be finalized before the transaction is completed. The most important factor to PMI success is to identify and monitor the key integration milestones to track progress and concentrate on the goal of the deal.
One of the most common mistakes in integration is to incorporate too much and destroy value by fundamentally changing aspects of the acquired company that made it attractive initially. In the same way, companies that acquire underestimate the duration it takes to successfully integrate a acquired company.
Another common error is not evaluating the culture and norms of work in sufficient detail. Conflicts could arise if for instance, the cultures of two companies are very different. To avoid this the buyer’s company should begin assessing during the due diligence process by inviting important individuals from the target company to evaluate their culture and work practices. This can be extremely useful in determining the kind of integration strategy that will be required after the deal closes.