Merger and Acquisition Growth Strategy

Mergers and Acquisitions enable numerous opportunities for growth. Organizations pursue these initiatives for a number of reasons — e.g. to expand further, attract more clients, or to broaden their product / service offerings. Scores of M&A transactions materialize across the globe each year, but not all of them achieve the synergies such deals promise. As a matter of fact, the success ratio is just around 27%.

The M&A Growth Framework is a structured approach to enhance the odds of a successful M&A transaction. This approach is instrumental in helping organizations capitalize on growth opportunities locked in M&A deals. The framework comprises 10 phases scattered across 3 timeframes:

1. Pre-deal Preparation
2. First 100 Days
3. Post-deal Closure

The 10 phases of the M&A Growth Framework organized under the 3 timeframes include:

PRE-CLOSE PLANNING & PREPARATION

1. Growth Opportunities
2. Go-to-Market Strategy
3. Customer Experience Strategy

FIRST 100 DAYS

1. Customer and Partner Readiness
2. Cross-sell Strategies
3. Pricing Management
4. Brand and Digital Presence Building

POST-DAY 1 ENVIRONMENT

1. Product and Service Roadmap
2. Sales Force Transformation
3. Long-term Revenue Synergies

The M&A Growth Framework facilitates in finding growth opportunities, aligning them with Go-to-Market Strategy, reinforcing Customer Experience, and enabling Organizational Readiness for integration after the M&A.

Let’s dive deeper into the first 3 phases of the M&A Growth Framework for now.

Growth Opportunities

The first step in achieving growth from a Merger or Acquisition deal is to identify and analyze the opportunities essential for growth.

Identification of growth opportunities necessitates:

• Gauging the ability of the new company to enter target markets.
• Conducting one-to-one interviews and Focus Group Discussions with key people from the management and customers to develop points of reference for existing key competencies.
• Identifying and translating growth opportunities into initiatives.
• Quantifying growth with timeline requirements.
• Prioritizing opportunities based on their magnitude, viability, and potential for effective execution.
• Utilizing clean teams to ensure confidentiality of data.

Go-to-Market Strategy

Identification and prioritization of growth opportunities necessitates delineating the Go-to-Market Strategy of the combined entity. This phase assists in achieving the newly-formed company’s stated growth targets, business continuity objectives, and proficient utilization of unified team and resources.

Key steps involved in this phase include:

• Combining the acquired entity’s product/service portfolio with the buyer’s offerings.
• Ascertaining and prioritizing strategic inputs.
• Translating the information and inputs available into prioritized action items.
• Segmenting the customers and their needs.
• Creating Go-to-Market plans.
• Connecting the sales channels with the unified company’s product mix.
• Ensuring resource readiness, sales targets, coverage, and channel mix.
• Finalizing marketing plans: communication, branding, targeting, product mix.

Customer Experience Strategy

As part of integrating the 2 unified companies, it is critical for the senior leadership to develop and deploy a Customer Experience (CE) Strategy. A consistent Customer Experience derives more value from existing customers, aids in the continuation of operations, and boosts customer spending.

Key steps in this phase entail:

• Appraising the existing customer experience, interactions, and customer pain points.
• Developing a customer-focused organization by creating seamless CE “personas” and customer journey maps.
• Identifying and ranking CE improvement initiatives.
• Implementing CE enhancement initiatives, monitoring outcomes, and correcting the course.
• Integrating the customers and Customer Experiences of the acquirer and the target companies.

Interested in learning more about the other phases of the M&A Growth Framework ? You can download an editable PowerPoint on M&A Growth Framework here on the Flevy documents marketplace.

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