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2009 acquisition acquisitions archive article back issue Boss News BPM BPO by John Symon by Mark Edwards by Paul Carman december Document Boss Document Management ECM IBM interview John Symon M&A Mark Davis Mark Edwards mergers and acquisitions news newsletter perspective recruitment SVP Asia Pacific SVP Continental Europe SVP North AmericaHeads up for ECM, BPM & BPO software executives globally
Does your M&A Strategy pack a punch or have you counted yourself out?
25 August 2010As the ECM market matures, competition for market share and thus profit margins become tighter. Fewer opportunities materialise with the high rates of return with organic business growth. Studies have shown that 72% of M&A transactions are geared towards enabling market expansion. The M&A route is a much lower risk and far speedier solution, compared with building an equivalent, significant position in a new region or market, through internal growth.
The vast majority of acquisitions are complimentary expansions, aligned to the acquiring company’s existing business services or products. This has proven to be a far less risky strategy than moving further afield into unfamiliar territory. 
If the decision to acquire is truly part of your growth strategy, has it been integrated into your company business plan? If so, there are some important factors you will need to consider; because if it is in your business plan, it is something you need to make happen?
- Do you have a timeframe for this to happen and with agreed and communicated actions? If not, it is merely a wish.
- How long have you been looking?
- What is your previous success record in M&A!
- If you have not been entirely successful in the past with your acquisitions, what are you going to do differently this time? If you don’t plan to change your modus operandi, why should the outcome be any different?
- How do you know if you are seeing the full vista within your focus area?
Have you considered the following?
- “In three years time, what will the acquisition have achieved for you?”
- Key criteria for your ideal acquisition
- Are the above criteria reflected in your qualification process?
- Are you passive in your M&A search?
- Within your company, who will be involved in the M&A process?
- How much of their time will it absorb?
- What would they have been doing if they weren’t involved with M&A?
- What impact will that have on your business?
- What is the optimal deal structure for your company?
I have seen far too many businesses paying lip service to the fact that they intend to grow via acquisition, yet sit passively sifting through endless, so called “opportunities” that happen to pass across their desk.
If you are serious about making a success of acquisition and it is part of your business plan, then you MUST be proactive.