Standardizing M&A Process
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Each M&A opportunity has its own characteristics, parameters and challenges, which implies different response and assessment methods and criteria.
Are you with standardizing the M&A process for all M&A transactions, or do you believe a customized process for each M&A transaction is more practical?
We understand that in some cases there are a sort of due diligence (check-list) whenever a firm is pursing an M&A transaction. I think firms should have the flexibility to either endorse the standard DD, or adjust their assessment depends on the sector, timing..etc.
I believe the M&A high-level process can be followed for all the different M&As. The industries or the countries should not alter any of these high-level guidelines. However, the specifics, in terms of functions and streams, should be customized based on the deal taking place.
Each M&A deal is different but I would encourage to have an overall acquisition institutional process or M&A corporate strategy in place
I agree with the others that every integration is unique and different. However, I do feel you can gain great value in creating a standardized process and templates that will create a great starting point for any integration. We’re in the process of creating a “Playbook” to address pain points, beginning with due diligence to create a more streamlined and efficient process for next go round. Best of luck
Love this question. It could be worth exploring which aspects of the process are always the same (per deal type) to standardize those and leave room for customizing the aspects that should be tailored to that deal.
In our organization we have been able to identify common elements that apply in the majority of M&A activities. From this we are able to generate a global project plan at a very high level that covers the majority of topics and that so far in the last few years of using it we don’t see fluctuate too much. That being said there are always unique, complex elements that come up on each project that may require customization. Additionally, the details within the high-level plan may have much variation depending on what country, division or other legal entity is using it.
I have authored our M&A Playbook which provides mission, vision, guiding principles and impacts, means and methods associated with the overall process, tools used, and questions to ask, etc. We have a small team comprised of two in Corp Dev and the rest are Workstream Leaders and members from each functional groups (e.g., HR, Finance, Legal, etc.), which I logically associate with a virtual IMO. I believe there is a way to have guideposts that enable navigating through each Deal, albeit we recognize every Deal is unique and different. The next evolution of the Playbook is for each Workstream Leaders to contribute their Playbooks to support the M&A activities. For the corporate communications and change management workstreams, I have documented the documents and types that were deployed. The pre-Close prep through public transaction disclosures are standardized, however the messaging is altered depending on the situation. We leverage a hybrid APM-TPM approach towards managing integration efforts to ensure we can pivot and iterate as needed. Every template is open for iteration prior to deploying it on the next deal, as an example, when involving another country and the need to include translations from English as a courtesy for the customer-base and employees even though the Seller has issues all business related documents in English.
I believe the overarching methodology should be standardized so you can ensure your clients have consistent approaches overall during the M&A process. However, from a planning perspective and actual execution, I think it’s important to mold that methodology to the industry and size of the overall deal to ensure it’s relevant and effective.
I really like the structured but flexible approach. If the organization and PMO or COE supports the integration teams in translating and customizing the playbook and all respond as necessary to the system feedback – it would be the best of both worlds.
I agree it’s a mixture of some structure but flexible. Having a set due diligence list for all sellers and general process is good for checking the boxes and consistency. The flexibility comes to play when working on the people/culture aspects. Different teams need may need different approaches.
I believe it needs to be a combination of the two – standard as far as strategic implementation and framework perspective but definitely customizable as far as operational execution and creation of potential departmental playbook delivery based on strengths/weakness in effort to attain benefits. Also believe prior/past learnings from other deals (post mortem etc.) help to create ways to enhance the process going forward.
I absolutely support and agree with having and/or maturing your M & A process to a standardized and repeatable process that includes lessons learned from each acquisition. Especially, as IMO’s are challenged more than ever to drive scale and accelerate value delivery of critical deal objectives. Also, as you work to mature and standardize your acquisition capabilities, it is equally important to gain organizational buy-in and alignment from all internal workstreams involved ahead of time to maximize overall effectiveness.
In M&A we deal with people and uncertainty. People doesn’t have standard routines and uncertainty is inevitable, this uncertainty starts from valuation assumptions to synergy modelling and growth rates. matching system of acquirer and target company is like combining two dynamical system in the same time that they are working in different speeds. from system dynamic point of view success of such merging dependent to many parameters otherwise like lack of clutch in auto we may heart the gear box. I think because of M&A nature we can’t make it standard, but we can make some guidelines to bring the M&A from fatal errors to manageable field.
We are currently working on an M&A playbook of sorts. Like with any project, M&As are all different and will each require different focuses. However, there are many practices that need to be done on all M&A regardless of the type or size. Having this playbook as a sort of start guide to then build off of.
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