Mergers and Acquisitions have now been cited by Goldman Sachs as the primary global growth strategy for large-cap companies. The last twelve months have seen the return of the strategic inquirer, with blue chip companies driving deal frequency and volumes not seen since 2007 and 2008. Yet, almost religiously, study after study shows that mergers and acquisitions fail at rate of 70% to 90%, leaving massive intellectual, creative and financial currency on the table.
The number one reason for M & A failure? Culture clash.
And a decades long flawed strategy titled “integration.”
Here’s the unspoken truth accompanied by the predictable chain of events.
An M&A is an arranged marriage.
- There is no love at the beginning.
- The issues start Day One.
- Executives announce the once hush-hushed M&A information.
- Employees feign excitement as FEAR ripples through both companies.
- The C suite announces: “This will be great for everyone!”
- No one is buying that promise.
A culture of SURVIVAL thinking and behaviors is now in play.
To quiet the fear, a WILDLY FLAWED STRATEGY called INTEGRATION is announced.