What makes a successful integration?

Our Deals Index survey has shown UK deal volume to be on the rise. Globally there has been a notable uptake in deal activity. The pharmaceutical industry has attracted particular attention recently with a flurry of high profile deals so far this year. These are typically cross-border and driven by a desire to reshape core product portfolios.

 

This means that the integration emphasis is likely to be on rightsizing sales teams and considering economies of scale in the back office.

 

Every deal is different and specifics will vary case-by-case. That said, we think that every successful integration programme will address the following three areas (although the emphasis on and content of each will vary by industry and will depend on the rationale and business case):

 

  1. People. There needs to be effective management of people through times of uncertainty. Communication is paramount to gain buy-in, identify and retain your key staff and bring people along with you in a changing culture of a combined business.
  2. Value. Whilst synergy identification and realisation is an important deal driver, our analysis shows that, for the majority of transactions, significantly more earnings growth is driven from the core business than through synergies. Identifying and focusing on priority value initiatives whilst maintaining focus on business as usual is critical to a well-balanced integration programme.
  3. Control. Keep control by driving the integration according to your business plan, supported by a process to manage risk, cost, issues and scope. Delivery structures need to support rapid decision making to create and maintain pace and accelerate the transition.

 

To learn more about how to integrate successfully watch our webcast on Thursday 24 July, or get full details here.

 

What challenges have you encountered during an integration? How did you overcome them? What advice would you give yourself if you could go back to the start?

 

Share your thoughts below or, if you’d like to discuss your situation confidentially please schedule a meeting here.

 

Erika Schraner |  Partner – UK Leader for M&A Integration
Profile | Email |  +44 (0)7738 845284

 

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