10 Common M&A Mistakes to Avoid (#5 of 10)

10 Common M&A Mistakes to Avoid (#5 of 10)

5. Ignoring the importance of post-merger integration

Over half of M&A deals fail or don’t produce their planned results. The number one reason is poor integration planning and execution after the merger or acquisition. If you are buying another company, you want to hit the ground running as soon as the deal is closed. You’ve placed a huge bet and you want to maximize your chances for success.

Your plan should include what you are going to do on day 1 — such as notify all employees, have leases and insurance in place, start communicating with customers and suppliers, know what systems and processes need to be changed or integrated, and so on. Also, there are two management issues that should be clear to everyone: who’s in charge of the business and who is in charge of the integration and how far are you planning to go with the integration?

In summary, plan early – BEFORE THE CLOSING – and get ready to hit the ground running after closing.

Take home message:  Plan the integration of the two companies before the closing.