Miller’s Monday Morning Message

Andrew MillerMiller’s Monday Morning Message
presented by ACM Consulting Inc.
Andrew Miller on operational excellence, strategy, life balance and everything in between

Toronto – June 10, 2013
Organizations have been controlling the way they spend money over the past few years and many are now sitting on piles of cash. We have already seen many acquisitions and we will see many more over the coming months. The success of an acquisition will be determined well before the due diligence phase begins. That success hinges on the process the acquiring company uses to identify potential acquisition targets and the decisions it makes before an offer is even made. Here are three things acquiring companies need to consider before engaging in talks with another company:
  • There needs to be a clear decision as to the future culture of the overall organization. Companies usually don’t get acquired for their culture, but for their technology or customers or expertise in a certain area. The acquiring company needs to be clear right up front about what the adopted culture will be.
  • There needs to be a fit at all levels. Organizations tend to just focus on synergy or opportunity at the executive level, but acquiring organizations need to understand the steps required, and how easy or difficult it will be, to integrate the new company into their culture.
  • There needs to be an alignment of goals. The acquiring company needs to ensure that it clearly communicates the goals for the future and that the company being acquired aligns with that vision. If the focus needs to be growth and innovation, the organizations need to be aligned to best take advantage of opportunities.

You will notice that I haven’t used the word “merger” because I don’t believe they truly exist in business. A merger is only a term to describe the financial terms of a certain transaction, but no business transaction is ever truly a merger. One culture needs to dominate. And since no two organizations are alike, eventually one culture wins out. The sooner that decision is made, the easier the integration will be. 

Like any other element of business, a company needs to have an acquisition process,” says Andrew Miller, president of ACM Consulting. “It needs to approach each acquisition target with some key decisions already made in order to make the acquisition successful. Acquisitions fail when the acquiring organization neglects making key decisions early on in the process.
 
To request an interview or more information, please contact:
 
Andrew Miller
416-480-1336
 
Follow me on Twitter @AndrewMillerACM
© Andrew Miller. All rights reserved. 2013.

Miller’s Monday Morning Message

Andrew MillerMiller’s Monday Morning Message
presented by ACM Consulting Inc.

Andrew Miller on operational excellence, strategy, life balance and everything in between

Toronto – February 18, 2013
With the news of two major acquisitions over the past two weeks, we see a flurry of activity beginning. With the purchase of HJ Heinz Co. by a group of investors led by Warren Buffett, and the “merger” between American Airlines and US Airways, here are some key tips that organizations should remember when embarking on a potential merger or acquisition:
  • The whole must be greater than the sum of the parts – This means that the combined organization after the deal must be better off than the individual companies were before. Too often these deals become just about cutting costs and not improving operations or increasing innovation.
  • Determine which culture will prevail Each company has a different culture, and one of them has to be chosen. Despite the use of the word “synergy” only one company culture can prevail (usually the larger company, frankly). In the merger of Canadian Airlines and Air Canada, we saw the absence of a clear culture decision and it took years and many unhappy customers for this deal to work out.
  • Develop an integration plan – Once you have identified the clear benefits of the merger or acquisition and the culture that will prevail, develop a plan that aligns with those decisions. Identify ambassadors from all levels of both organizations in order to help make the transition easier for employees and customers.
  • Don’t rely on existing people – If the people in your organization have never been through a merger or acquisition, why would they know how to approach it? Bring in outside support with successful experience leading people and companies through this kind of change.
“The key to making a merger or acquisition work is to ensure the people in both organizations know what is happening” says Andrew Miller, President of ACM Consulting. “Too many of these deals fail because the executives focus on upper level integration and forgot about the anxiety that all of the other employees are feeling.”
 
To request an interview or more information, please contact:
 
Andrew Miller
416-480-1336
 
Follow me on Twitter @AndrewMillerACM
© Andrew Miller. All rights reserved. 2013.