Minimizing costs when integrating small company in global corporate

This topic contains 1 reply, has 2 voices, and was last updated by  David Castell 1 month ago.

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  • #116334

    Henrik Jernstrom
    Participant

    In a global corporation, processes and policies (financial reporting, legal, HR, IT systems etc.) are well defined and hopefully running efficiently. Integrating a small company into these is a must in order for the global corporation not having to dedicate specific resources, but the processes and policies may not deliver value to the small company but instead create additional costs through more resources required and installation of for example IT system. How can one minimize the additional costs and how to maximise the value of the integration for both the acquiring corporation and the small company?

    #116460

    David Castell
    Participant

    By mapping which activities/services are covered directly by each entity (mapping also outsourced services) could help to identify which areas to preserve by each party.
    Smaller organisations could be functionally integrated into the bigger one, or even eliminated if obsolete.

    New opportunities could arise on areas where the smaller (acquired) company could provide a service to the acquiring (bigger) company. This could be the case when the targeted company would be i.e. in a BCC (Best Cost Country) with significantly optimised labour cost or overhead expenses.

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