When a large company buys a smaller company, the initial optimism and excitement can give way to feelings of disappointment and frustration on both sides. This can happen within a couple of years. The entrepreneurial spirit and the nimbleness of the acquired company – i.e. the very features the acquirer admired - can disappear. Why does this happen?
I spoke with a number of top global leaders and asked about their experiences with their mergers and acquisitions. There were striking similarities between their stories, that are summarized in the article below, together with my recommendations for a different approach to integration.
“WHEN ELEPHANT AND ROADRUNNER DANCE…”
Your Big Company Just Acquired a Much Smaller Company. Now What?
What can companies do differently? A sampling...
- Instead of rolling out an undifferentiated integration process, the acquiring company can define different levels of integration possible and select the level best suited for the newly acquired company.
- The integration can be focused to 90% on growth and 10% on integration.
- The parent can help its young subsidiary overcome its growth-related challenges.
- The acquirer can take the opportunity to zero-base its own processes (decisions, reporting…) that slow down the new subsidiary.
Please read more in the article at the link above. Click the link, download the pdf, and please let me know what you think.
Fred Weling, Ph.D.
CEO, Actios Management Consulting.
Actios Management Consulting specializes in collaborative efficiency improvement and revenue growth projects for small and mid-sized companies in any industry.