Insprie

Situation 19

We have acquired a business and integration is not going well.

The deal closed. The value case now depends on decisions nobody has made yet.

The situation

An acquisition has completed and the two businesses are still operating as two businesses. Synergies assumed in the model have not appeared, and both teams are busy protecting their own way of working.

Integration value decays quickly. What is not decided in the first hundred days usually becomes permanent.

What usually goes wrong

  • Nobody owns integration as a job, so it becomes everyone's side project.
  • Systems, ranges and channels are left duplicated to avoid short-term disruption.
  • Cost synergies are pursued while revenue and service quietly deteriorate.
  • Culture is treated as a communications exercise rather than a decision-rights problem.
  • Reporting continues in two formats, so performance cannot be seen as one business.

What needs to be established first

  • What was the value case, stated in operating terms rather than deal terms?
  • Which decisions must be made now, and who holds each one?
  • What must be genuinely combined, and what is better left separate?
  • Which people are critical to the value case, and are they staying?
  • What single set of numbers will the board govern from?

The next 30 to 100 days

  • Name integration ownership with authority and a reporting line to the board.
  • Sequence the small number of changes that carry most of the value.
  • Consolidate reporting into one view of trading, margin and cash.
  • Combine range, channel and supply decisions deliberately rather than by attrition.
  • Track the value case against actuals, and correct the plan where it was wrong.

Capabilities involved

Related intelligence

Other situations

Certain details have been withheld or generalised to protect client confidentiality.

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