In my home state of South Carolina, the fibers of the American Civil War are tightly woven into its cultural fabric—as evidenced by the state’s numerous driving routes, adorned with historic markers referencing significant wartime events. Follow these trails and you’ll visit a variety of remarkable sites, including where the first shots of the Civil War were fired (Charleston Harbor) and the spot where Confederate troops mounted a desperate attempt to block General Sherman’s advance across the Carolinas (Rivers Bridge).
Marshaling your own troops and running your small- to mid-sized business, day in and day out, might make you feel as if you’re in a constant battle yourself—mustering the infantry in R&D to develop innovations, or taking a defensive position to fortify your organization against marketplace competitors. There is constant anxiety about losing ground. And constant pressure to advance.
Even if your company has been successful for some time, you may feel the pressure of flattening sales, a decline in core business, or sliding profits. Or, perhaps your sales team has heard growing rumors of a new competitive initiative that could potentially undermine troop morale and loyalty. Maybe it’s time to consider an aggressive maneuver to capture a bigger chuck of your market battlefield.
One such strategy (which indeed has worked for small- and mid-sized militias for ages): Joining forces, via merger or acquisition, to create a stronger army.
This can be quite an undertaking, but your troops are tenacious and hungry. But what’s the best approach? To determine which battle route is most prudent, let’s review the two uniquely different types of mergers.
The M&A route, indeed, is a risky battlefield strategy. According to the International Institute of Management Development, it’s estimated that approximately 60 percent of all mergers and acquisitions are unsuccessful. Less than coin-toss odds of success merit careful scrutiny – yet, if executed effectively, a merger or acquisition can have significant benefits for a small to mid-sized company.
Let’s take a look are four distinct benefits that can be derived as a result of this strategic alignment:
Like the “War Between the States,” engaging in a merger or acquisition is not something to take lightly, but it could be the bold and courageous movement your company needs to accelerate profitability and growth in your industry.
Pressured to flank the competition? Examine your war chest and consider the possibility of a merger with consolidation or an acquisition—and wisely initiate the maneuver before your troops grow restless—or contemplate surrender.
Topics: Mergers & AcquisitionsFri, Mar 11, 2016