To begin with, let’s be honest, inside the strategy development realm we climb onto shoulders of thought leaders like Drucker, Peters, Porter and Collins. Even the world’s top business schools and leading consultancies apply frameworks that were incubated with the pioneering work of such innovators. Bad strategy, misaligned M&A, and poorly executed post merger integrations fertilize the business turnaround industry’s bumper crop. This phenomenon is grounded from the ironic reality that it’s the turnaround professional that frequently mops inside the work with the failed strategist, often delving into the bailout of derailed M&A. As corporate performance experts, we’ve got discovered that the process of developing strategy must be the cause of critical resource constraints-capital, talent and time; concurrently, implementing strategy need to take into account execution leadership, communication skills and slippage. Being excellent in a choice of is rare; being excellent in both is seldom, if, attained. So, let’s talk about a turnaround expert’s take a look at proper M&A strategy and execution.

Inside our opinion, the essence of corporate strategy, involving both organic and acquisition-related activities, is the search for profitable growth and sustained competitive advantage. Strategic initiatives have to have a deep idea of strengths, weaknesses, opportunities and threats, and also the balance of power within the company’s ecosystem. The company must segregate attributes which are either ripe for value creation or at risk of value destruction like distinctive core competencies, privileged assets, and special relationships, along with areas prone to discontinuity. Within these attributes rest potential growth pockets through “monetization” of traditional tangible assets, customer relationships, strategic real estate, networks and data.

Their potential essentially pivots on capabilities and opportunities that can be leveraged. But regaining competitive advantage by acquisitive repositioning is often a path potentially brimming with mines and pitfalls. And, although acquiring an underperforming business with hidden assets and other kinds of strategic real estate property can certainly transition an organization into to untapped markets and new profitability, it is advisable to avoid purchasing a problem. In the end, a poor customers are just a bad business. To commence an effective strategic process, a firm must set direction by crafting its vision and mission. As soon as the corporate identity and congruent goals are in place the way may be paved the following:

First, articulate growth aspirations and see the foundation of competition
Second, measure the life-cycle stage and core competencies in the company (or the subsidiary/division when it comes to conglomerates)
Third, structure a natural assessment method that evaluates markets, products, channels, services, talent and financial wherewithal
Fourth, prioritize growth opportunities ranging from organic to M&A to joint ventures/partnerships-the classic “make vs. buy” matrices
Fifth, decide where to invest where to divest
Sixth, develop an M&A program with objectives, frequency, size and timing of deals
Finally, have a seasoned and proven team willing to integrate and realize the value.

Regarding its M&A program, a company must first observe that most inorganic initiatives usually do not yield desired shareholders returns. Given this harsh reality, it’s paramount to approach the task using a spirit of rigor.

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