Integration is a critical stage in M&A. However it has also been 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 think that they have the proper capacities and capabilities for integration as compared to other stages of M&A.
To overcome this issue It is crucial to clearly communicate the reason for the acquisition as well as the techniques for integration. This will ensure that everyone knows what they are expected to do and how M&A can benefit their organization.
It is also essential to employ the best practices tailored to the objectives of the deal. It is important to use the same team of professionals who conducted the due diligence on the M&A deal for the post-merger implementation. This ensures continuity and avoids repetition of efforts.
Another challenge is the need to maintain momentum throughout the integration process. It is crucial that the team integrating the companies without sacrificing growth. Additionally, this requires a solid understanding of the M&A company’s operations so that the team in charge of integration can make decisions that have the least impact on daily activities.
It is also essential to establish a solid integration governance structure to track and capture synergies. This includes establishing an M&A leadership group (which should comprise representatives from both organisations) and then developing an integration plan and establishing clear lines of accountability. M&As that follow these integration best practices can provide up to 6 to 12 percent higher returns on their totals for shareholders than those who don’t.