Merger Acquisition Integration (M&A) Mistakes

The deal may be closed at the time M&A transactions are complete, but if companies don’t properly initiate integration following the closing of the transaction, they could lose out on substantial value. As with all M&A activities the merger acquisition integration process is the most challenging and time-consuming to execute. A functioning team along with good communication and a sound plan are essential for success.

Planning for integration ahead of time can avoid many of the issues that companies confront during integration. Integrating systems, like requires thorough analysis of issues such as data ownership, process sync, and many more. Also, IT solutions need to be developed early to enable the new unified company to rapidly reap the benefits. Planning should start during due diligence and the PMI Framework should be completed prior to closing the deal. Furthermore, the most important factor to success in PMI is tracking and identifying key integration milestones to track progress and concentrate on the goals of the deal.

A common mistake is to integrate too excessively. This can cause loss of value because it alters the features of the acquired business that made it attractive. In the same way, companies that acquire underestimate the amount of time it takes to successfully integrate an acquired company.

Another mistake that is common is to not examine the norms and culture of the workplace enough. For instance, if workplace cultures of two companies are very different there will be clashes. To avoid this the acquirer can begin assessing its culture during the due diligence stage by inviting key employees from the target company to assess their work habits and culture. This can be extremely helpful in determining the kind of integration strategy that will be required after the deal closes.

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