When M&A transactions close it could be complete, but if the companies fail to begin post-closing integration properly, they could risk missing out on significant value. The most time-consuming and difficult M&A activity is merger acquisition integration. A solid team that is well-functioning, clear communication, and a solid plan are vital to ensure success.
Pre-integration planning can eliminate many of the challenges companies confront during integration. Integrating systems, like, requires a thorough analysis of issues such as data ownership as well as process sync and so on. Innovative IT solutions are required to enable the new unified company to benefit quickly. The ideal plan should be developed during due diligence and then the PMI framework should be finalized prior to closing the deal. The most important factor to success in PMI is to identify and track important integration milestones to monitor progress and keep an eye on the desired outcomes of the deal.
A common error is to integrate too much. This destroys value by changing the aspects of the acquired business that make it attractive. Similar to this, acquisition companies often underestimate the length of time it takes to successfully integrate an acquired company.
Another common mistake is to not examine the norms and culture of the workplace enough. Conflicts could arise if for example, the cultures of two companies are quite different. To avoid problems the buyer could begin the evaluation at the due diligence stage by inviting key individuals from the target company to assess their work habits and cultural. This is extremely useful in determining the type of integration strategy that will be required following the closing.
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