Considering Mergers and Acquisitions: 5 Behaviors of Leaders Who Embrace Change

At best, mergers and acquisitions (M&A’s) have a 50/50 chance of reaching their intended results. Study after study puts the failure rate closer to 70-90%. Why is the failure rate so high? Repeatedly, research cites the human factor as the leading reason why mergers and acquisitions fail.

Extract from article by Edith Onderick-Harvey

At best, mergers and acquisitions (M&A’s) have a 50/50 chance of reaching their intended results. Study after study puts the failure rate closer to 70-90%. Why is the failure rate so high? Repeatedly, research cites the human factor as the leading reason why mergers and acquisitions fail.

Part of the issue is how organizations view the human aspect of the closing date, which is usually treated as the end of the transaction, when it’s really just the start of change. Organizations, processes, and cultures will be integrated for weeks and months after the organizations come together, causing disruption and uncertainty. Leaders in the M&A environment are managing an organization that hasn’t existed before. Their people are no longer part of the organization they joined. Their sense of normal is disrupted. In response, they may choose to hold on to the past and what’s comfortable or feel a bit disoriented as they search for their place in the new company. In the midst of the disruption, new challenges and opportunities will arise not just in the integration of the new organization, but in its marketplace and among its customers.

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