New Perspectives
Welcome to the Strateco blog, where we share fresh perspectives, practices and tools on how to better navigate the complexity of strategy, leadership development, culture and change. If our ideas resonate, please join our growing community and share.

M&A Integration: An Approach that Works

Happy September.  We hope you had an amazing Summer and are
rejuvenated for the Fall season.

As you may know, most research confirms M&A deals have a mere
50% success rate.  A coin toss.  Why?  

While an M&A integration deal may look great on paper, we’ve found
only a handful of organizations pay proper attention to the integration
process.  This can be especially concerning for mid-market companies
($50 – $500M in sales) who can ill-afford the resource drain to patch
things up once they’ve gone astray.

Last month we were brought into an acquisition project at just the
right time.  As is often the case, the deal looked great – it was
financially accretive, there were cross-selling opportunities, there were
cost redundancies that when adjusted would create exciting increases
in free cash flow – but in spite of all this, the two “merged” units still
operated in two silos, results were not being achieved, and there was
an air of animosity along with dense frustration.

Firstly we brought together senior leaders from both groups to clearly establish relational and operating ground-rules for our interactions – no blame, no judgement, openness, candour and a willingness to find open ground.  These “values” were co-created with participants being encouraged to hold one another to these highest ground-floor values.
 
Next we acknowledged what wasn’t working – focusing on tactics and behaviours, not personalities – and made a commitment to wrestle the “eight-headed hydra” to the ground”.

We then took time to envision what was the highest future possibility for the combined entity, clarified this, and grounded it in in quantifiable success metrics for the coming year.

Finally we rolled up our sleeves trudging through each key issue – role clarity, handoffs between groups, communication, governance – prioritizing a tactical plan with dates and champions.

The Result – the senior teams left the retreat “as one” – feeling energized, liberated and inspired to execute with a great sense of clarity.  The real merger had begun.

The Secret Ingredient – Dealing with the negative preconceptions and feelings about change up front while establishing behavioral and attitudinal rules of conduct before coming together – essentially creating a healthy culture for the series of meetings – that could then extend into the merged organization and help  everyone understand, Culture is King!

Wishing you a happy Fall and, as we come upon the 2015 planning season, if you’d like to have a conversation about raising the bar on your  strategy, leadership, or culture planning needs, feel free to email us any time
 
Bests,
Nick and the Strateco Team

 
 
Interested in learning about the evolution of a new paradigm in business?

Check out our white paper, Strategy + Leadership 2.0, to learn how Shared Value Strategy and Purposeful Leadership are shaping the era of Capitalism 2.0

*See something below you’d like to read or watch right away?  Click on a title to jump right to the summary!

 
Two intriguing perspectives on the shifting tides in management today:
 
1.  The Great Transformation – Drucker Society of Europe
2.  Why Can’t We End Short-Termism? – Forbes
 
Three fabulous leadership resources:
 
3.  Inspiring 2-min video!  Performance with Purpose – ASPEN
4.  Lead Without Trying So Hard – HBR
5.  First Know Yourself, Than Your Team – INSEAD
 
A TED Talk exploring the evolution of 21st century business leadership:
 
6.  What it Takes to be a Great Leader – TED
 
A book focused on helping you manage your greatest resource:
 
7.  Alliance: Managing Talent in the Networked Age
 
 
1.  THE GREAT TRANSFORMATION
     Drucker Society of Europe – May 2014     
 
“We are at the beginning of a set of gigantic changes in society – for better or for worse…one thing we know says Richard Straub (President, Drucker Society of Europe): on this stage, managers will surely be of pivotal importance for shaping it.”
 
So begins Dr. Straub’s introductory article to this year’s Global Drucker Forum.  It provides an intriguing line of sight into various global trends negatively impacting economies and societies today.
 
Of greater significance, Straub zeros in on the role of Managers in 21st century business and how these leaders will make a difference in the world via their knowledge, creativity, emotions, and values.

 
 
2.  WHY CAN’T WE END SHORT-TERMISM?
     Forbes – July 2014     
 
As a leader, consider your response to the following statement – “The world would be a better place if businesses stopped thinking so much about short-term results and focused more on the long term.”
 
In another fresh take on the radical changes in management today, Steve Denning explores how maximizing shareholder value (a key driver of short-term thinking) has come at the detriment of prosperity for business and society. 

 
 
3.  Inspiring 2-min video!  PERFORMANCE WITH PURPOSE
     ASPEN Ideas Festival – July 2014     
 
“Employees were looking for a purpose…for an environment where everyone could bring their whole self to work.”  – Indra Nooyi, CEO, PepsiCo

At this year’s Aspen Institute Ideas Festival, Nooyi shared these and other profound thoughts on Pepsi’s ‘Performance with Purpose’ culture. 

 
 
4.  LEAD WITHOUT TRYING SO HARD
     HBR – July 2014     
 
“Demanding nothing in return for his kindness, the sage eventually obtains everything…the more he gives to others, the more he has himself.”

This is a fantastic 3-minute read!  Whitney Johnson describes the significance of the Taoist principle Wu-wei.  An ancient practice whereby leaders let their minds go, entering a state of acceptance where they can only win, if they don’t try to win.

 
 5.  FIRST KNOW YOURSELF, THAN YOUR TEAM 
     INSEAD – August 2014     
 
This brief yet powerful article typifies the need for leaders to deeply understand their own behavioural traits, in addition to those of their followers, as key influencers of their effectiveness.
 
Of the eight leader archetypes noted in the article, which ones might you fall into?  What of your team members?  Perhaps of greater significance, how might these perspectives aid in your team’s relationships and effectiveness?

 
 
6.  WHAT IT TAKES TO BE A GREAT LEADER
     TED – 2013     

What makes a great leader in the 21st century?  What is the diversity measure of a leader’s network?  Is a leader courageous enough to abandon a practice that made them successful in the past?
 
In this captivating Talk, Roselinde Torres describes her research into these questions, eliciting a sense of what ‘great leaders’ are doing distinctly different to thrive and grow in 21st century business. 

 
 
7.  ALLIANCE: MANAGING TALENT IN THE NETWORKED AGE
     Reid Hoffman, et al. – July 2014     
 
This book is a must read for leaders of organizations struggling to maintain cultures of engagement and trusting relationships with their talent.  In short, the authors state the employer-employee relationship is broken.

The old model of guaranteed long-term employment no longer works in a business environment defined by short-term thinking.  In this modern era it’s no longer about treating colleagues as family, but rather as allies.
 
Far more than a rant, the author’s blueprint for building lasting relationships with top talent is based on real world examples from LinkedIn, Tesla, and Cisco.
 
You can also check out an excellent SlideShare summary of the book here!

 
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Strateco is a new breed of consulting firm that seamlessly integrates Strategy with Leadership.   We help organizations create, integrate, and execute winning strategies, while developing higher functioning leaders.   To get a sense of our philosophy download your PDF copy of our newly released white paper:  Strategy + Leadership 2.0

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