Integration

Winning the competitive bid for a target is the first half of the battle. Integrating the acquired company is at least as important to ensuring a successful transaction. Integration efforts that are poorly designed can lead to excessive delays, confusion amongst new colleagues, poor morale, an exodus of talent, and higher expenses than were forecast in the acquisition financial model.

Integration strategy is grounded in the objectives that led to the transaction in the first place. The key synergies and drivers of value need the most attention to ensure they are fully realized in the integration process. These drivers of value must be quantified and embedded in integration and performance goals.

This is where Behavioral M&A comes full circle. Every assumption that got stretched to make the winning bid pencil out — the headcount cuts, the discount rate, the pace of revenue synergies — does not disappear once the deal closes. It becomes a target someone in the combined company is now accountable for hitting. A finance function that pushed back on unrealistic assumptions during the bid has done half the job; the other half is holding the business to those same numbers after the ink is dry, rather than quietly letting a disappointing year get explained away. The model that won the auction and the model that measures whether the acquisition actually worked should be the same model, not two different stories told to two different audiences.