There are many things to bear in mind when acquiring a company. However, if I were restricted to just 8, they would probably be the following:
1. Maintain your focus on your business.
Acquisitions can be time consuming and distracting. You don’t want your management to have their attention taken away from running their business and allow performance to be affected. M&A activity is like a magnet for management attention. Ensure this does not happen.
2. Begin with the end in mind.
I hope Stephen Covey would excuse me on this one but it is so important. You need to know clearly what the acquisition needs to achieve for your company before you start your search. Many executives make the mistake of looking first and then seeing how the company could possibly fit. Companies that acquire in an opportunistic manner have proven worse results for post acquisition success.
3. Ensure you have a clear understanding of who and what you are.
By this I mean understanding clearly who and what type company are you currently. Where are your strengths? What is your current positioning? What is your value proposition?
4. Have a true and clear view of your competition.
When planning an acquisition it is no time to overstate your strengths with a Pollyanna view of your world.
5. Have an M&A strategy that fits with your business plan.
Surely, you would say this is obvious common sense? I would agree, but having an M&A strategy that really fits the company’s business plan is not as common as you may think.
6. Create a set of SMART acquisition objectives.
Be Specific, make them Measurable, Agreed upon within your team, Realistic and within a Timeframe.
7. Acquire with the insurance of knowledge and experience.
Many acquisitions fail because they try to operate in areas that they do not know well or they have insufficient data.
8. Don’t suffer from keyhole vision.
Ensure that you know the clear overview of the businesses that operate in the sector where you intend to acquire. So many acquisitions set out in pursuit of a few known competitors and then try to shoehorn them to make them fit. You need to have a good view of the possibilities so you get a “Right Fit.”
Some recent "8 things" posts:
- 8 things you need to know about content classification and ECM
- 8 ways to increase user adoption in an ECM project
- 8 reasons why information governance makes sense
- 8 steps to the ISO 15489 Records Management methodology
- 8 steps to consider when starting an ECM project
- 8 things you need to know about workflow and business process engineering
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