January 28, 2011 | Written by: Jill Tutino
When you talk about M&A, people always think it so complicated. Many companies make it more complicated, and the ones that don’t often don’t fair well on the back end of a merger. Why is that? Maybe because M&A has so many moving parts, maybe because so many great minds typically surround transaction (think lawyers, bankers, CEO’s, etc), or maybe it seems like it should be “business as usual”, so why make it complicated.
So for the sake of simplicity, let’s make it uncomplicated for a moment and see how it nets out. Here are the top 10 Best Practices that can make your due diligence and integration efforts a success:
Due Diligence & Integration Best Practices:
- Treat every interaction like an interview (knowledge is additive, so time is to your advantage as the buyer)
- Focus on the critical stuff first
- Share knowledge (collaborate – use M&A Technology – understand why the deal is being pursued and how diligence can help it)
- Leverage past best practices (start with standard checklists in an M&A automation tool)
- Kill bad deals fast (focus participants on value and focus participants on deals that have high probability of closing)
- Structure findings for use later in process (ie. screen findings by impact area: impacts deal, impacts valuation, impacts integration – M&A technology can automate this one too)
- Use findings from diligence to inform process (M&A automation works here)
- Measure it (set up milestones and ensure that all participants understand deal objectives – all in the M&A automation tool)
- Pick the right people to lead it
- Understand culture issues
That was easy and uncomplicated – right? Now, here’s the complicated part – how to get those things working within your transactions.