M&A is a mug’s game: Typically 70 – 90 % of acquisitions are abysmal failuresHarvard Business Review
The global business of corporate mergers and acquisitions is booming like never before. According to data from Bain & Company, strategic and publicized M&A deals in 2020 totaling US$ 2800 billion around the globe.
Companies typically engage in M&A deals to increase their market share, improve their business model and enhance their technological skills – and the future of the companies involved in such deals can vary. M&A deals can result in two companies consolidating to form an entirely new company; in the dissolution of one company after it is bought by another; or in a company simply operating under the umbrella of a new parent company – depending on the specifics. Global M&A activity continue to climb – yet most M&A deals continue to fail. Study after Study put the failure rate at over 70%, including Harvard Business School, Bain, Great Prairie Group, and many others.
Why Deals Fail
So, why do M&A deals fail? Quite simple, mergers and acquisitions fail to deliver due to poor planning or poor execution or both.
One of the biggest mistakes companies make during PMI (Post Merger Integration) is ignoring the issue of organizational culture – or addressing it only superficially. Culture impacts everything in business operations. It influences what members of the organization value, how they set priorities and make decisions, what type of individuals are successful, and how people behave in the face of challenge or crisis.
Achieve The Full Potential Of Your M&A Deal.
After some preparations we enter into a process phase of vertical development and growing to integrate the perspectives of company A, company B, profit, people, planet and purpose.
The result of this experience will be a new picture of the future for the NewCo, company C, which provides the blueprint for further organizational transformation. Beside performance and process issues, we keep focus on mindset and cultural aspects as well. Based on our experiences, mindset and culture shifts are the key success factors.
We move together through a process, which offers the possibility of a profound shift in mindset and values. We let the future inform us, how the new combined company shall look like in regards to purpose, responsibility, people, products, projects, performance, and organization.
For further information, please contact Rainer Votsmeier at +49 160 9892 6999 or email@example.com.