Mergers and Acquisitions enable numerous opportunities for growth. Organizations pursue these initiatives for a number of reasons—e.g. to expand further, attract more clients, or to broaden their product / service offerings. Scores of M&A transactions materialize across the globe each year, but not all of them achieve the synergies such deals promise. As a matter of fact, the success ratio is just around 27%.
The M&A Growth Framework is a structured approach to enhance the odds of a successful M&A transaction. This approach is instrumental in helping organizations capitalize on growth opportunities locked in M&A deals. The framework comprises 10 phases scattered across 3 timeframes:
- Pre-deal Preparation
- First 100 Days
- Post-deal Closure
The 10 phases of the M&A Growth Framework organized under the 3 timeframes include:
- PRE-CLOSE PLANNING & PREPARATION
- Growth Opportunities
- Go-to-Market Strategy
- Customer Experience Strategy
- FIRST 100 DAYS
- Customer and Partner Readiness
- Cross-sell Strategies
- Pricing Management
- Brand and Digital Presence Building
- POST-DAY 1 ENVIRONMENT
- Product and Service Roadmap
- Sales Force Transformation
- Long-term Revenue Synergies
The M&A Growth Framework facilitates in finding growth opportunities, aligning them with Go-to-Market Strategy, reinforcing Customer Experience, and enabling Organizational Readiness for integration after the M&A.
Let’s dive deeper into the first 3 phases of the M&A Growth Framework for now.
The first step in achieving growth from a Merger or Acquisition deal is to identify and analyze the opportunities essential for growth.
Identification of growth opportunities necessitates:
- Gauging the ability of the new company to enter target markets.
- Conducting one-to-one interviews and Focus Group Discussions with key people from the management and customers to develop points of reference for existing key competencies.
- Identifying and translating growth opportunities into initiatives.
- Quantifying growth with timeline requirements.
- Prioritizing opportunities based on their magnitude, viability, and potential for effective execution.
- Utilizing clean teams to ensure confidentiality of data.
Identification and prioritization of growth opportunities necessitates delineating the Go-to-Market Strategy of the combined entity. This phase assists in achieving the newly-formed company’s stated growth targets, business continuity objectives, and proficient utilization of unified team and resources.
Key steps involved in this phase include:
- Combining the acquired entity’s product/service portfolio with the buyer’s offerings.
- Ascertaining and prioritizing strategic inputs.
- Translating the information and inputs available into prioritized action items.
- Segmenting the customers and their needs.
- Creating Go-to-Market plans.
- Connecting the sales channels with the unified company’s product mix.
- Ensuring resource readiness, sales targets, coverage, and channel mix.
- Finalizing marketing plans: communication, branding, targeting, product mix.
Customer Experience Strategy
As part of integrating the 2 unified companies, it is critical for the senior leadership to develop and deploy a Customer Experience (CE) Strategy. A consistent Customer Experience derives more value from existing customers, aids in the continuation of operations, and boosts customer spending.
Key steps in this phase entail:
- Appraising the existing customer experience, interactions, and customer pain points.
- Developing a customer-focused organization by creating seamless CE “personas” and customer journey maps.
- Identifying and ranking CE improvement initiatives.
- Implementing CE enhancement initiatives, monitoring outcomes, and correcting the course.
- Integrating the customers and Customer Experiences of the acquirer and the target companies.
Interested in learning more about the other phases of the M&A Growth Framework ? You can download an editable PowerPoint on M&A Growth Framework here on the Flevy documents marketplace.
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