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Tips to mitigate common merger and acquisition challenges

A well-structured merger and acquisition deal can help better ensure a smooth transition after the business is sold. Business owners can help achieve this goal by avoiding common challenges that are often present during these deals. Two challenges that are often overlooked that can make or break the success of a deal include:

 

  • Culture change. The culture of a business going through a merger and acquisition deal will change both during the negotiations and again after the deal is complete. During the deal, key players in the business and employees will know that they are not likely to benefit from the deal. They will also know business owners are posturing to get a major windfall. This can cause some animosity and negatively impact the culture of the organization.
  • Consider integration. After the deal is complete, the two business operations will integrate into one. Each business likely operated differently prior to the deal, perhaps using different operating systems and technologies.

Knowing that these issues can be present is one step, taking action to mitigate the damage the cause is the next. A recent piece in Forbes provides answers through the example of an acquisition deal that went wrong. The key issues were the two outlined above: a lack of appreciation for the cultural changes and a failure to properly integrate the two businesses. A leader from within the organization recommended assigning a point person to take the lead on integration issues. This can include both logistical issues, like business operations, as well as cultural issues.

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