Choosing The Right Integration Strategy In M&A

Choosing The Right Integration Strategy In M&A

In an #mergersandacquisitions deal, Integration Strategy is crucial to realising the deal rationale. In my experience, we need to factor in #Sharedeconomics, the Degree of overlap in decision-making, and the #Culturalfit between the acquirer and target to finalize the integration strategy.

1)Complete separation: When deal rationale focuses on entering a new adjacent business, it makes sense to separate the target entity and report directly to the CEO.

2) Back-end integration with front-end separation: When a deal rationale focuses on access to new customer segments, new channels, and new geographies, it makes sense to integrate the back-office and infrastructure of the target with the buyer. Sales and Marketing need to be separated.

3) Back-end separation with front-end integration: When the deal rationale focuses on increasing the wallet share of existing customers by providing end-to-end capabilities, high success happens when the development team is separate and the front-end sales integrated.

These points may be obvious, but the devil is in the details—how multiple technical teams on the back end interact with an integrated front-end customer-facing organization to realize the acquisition goals determine the integration success.