The Merger and Acquisition Shopping Experience

1 min read

A robot pushing a cart full of gold

Digital improvements have transformed shoppers’ mindsets, and firms can use new best practices to buy or sell assets.

Digital technology has made it simpler for people to shop for the best deals, compare costs, and check product reviews and ratings before purchasing.

The same is true for organizations engaged in mergers and acquisitions, as digital innovations enable tools and platforms that support the collection and sharing of information about an organization’s targeted assets. A buyer can streamline the due diligence procedure and make it simpler to spot possible problems or areas of concern by just processing the publicly accessible data.

However, the significance of digital technologies does not stop at the planning stage. Today the integration in the cloud can facilitate communication and collaboration between the two companies, allowing them to work together more efficiently and effectively almost seamlessly from day one.

As in many other situations, taking advantage of all that technology offers can produce the opposite effect.

This seamless collaboration should not distract from the deeper integration of the business architecture beyond streamlining operations and reducing costs.

Beyond the financial aspects, the merging opportunity consists in creating a new entity, more resilient and agile in following the changing trajectory of the industry.

So what is the real opportunity behind M&A?

Investors and partners should consider the newco a reengineering lab that seeks to optimize collaboration with the industrial ecosystem.

The merger and acquisition transaction provides a once-in-a-lifetime opportunity to identify and establish the optimal linkages, technologies, and standards for concurrent participation in responding to demand changes.

It necessitates a flexible, scalable, and long-term operational framework.

This strategy can enable the organization’s edge to look for opportunities that higher-level management would overlook.

A winning M&A strategy should dynamically adjust corporate expectations to changes in the ecosystem, focusing on long-term advantages while fueling the journey with short-term gains. Targeting an immediate payoff and imposing culture change without aligning values would impede integration and expose the newborn organization to survival risks.

Many M&A strategies do not leverage the abundance of information available, remaining static around their immediate financial objectives or, worse, moving at an irregular pace the knowledge sharing. They accelerate (crash) down the external perspective while struggling (stop) to ascend the internal integration path, much like bicycles on hills. A pattern that illustrates well the energy constraints of their setup.

Conclusions

With the advent of online shopping, people can now purchase goods and services at any hour from the comfort of their couch without physically visiting a store. In addition, digital technology has made it easier for people to compare prices, find the best deals, reading reviews and ratings from other customers before making a purchase.

It does not apply only to consumers but as well to organizations that want to buy or sell their assets.

The objective of an M&A transaction is in the medium-long term.

The business size matters less nowadays.  The goal of any successful strategy is value niche dominance.

Old price strategy work no more with the same efficiency. With the crumbling of sector barriers, competition has increased with unexpected outcomes. New value strategies should provoke investments that look beyond traditional boundaries and question where the organization can create worth for employees, customers and partners, and the ecosystem as a whole.

Flavio Aliberti Flavio Aliberti brings with him a 22-year track record in consulting around business intelligence, change management, strategy, M&A transformation, IT and SOX auditing for high regulated domains, like Insurance, Airlines, Trade Associations, Automotive, and Pharma. He holds an MSc in Space Aeronautic Engineering from the University of Naples and an MSc in Advanced Information Technology and Business Management from the University of Wales.

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