Guide to Mergers & Acquisitions Part 3: Optimise & Transition

After you have redesigned and transformed the acquired company, you may believe you have completed your efforts to maximise value from your acquisition. However, there are still two stages remaining to reach the best return on your investment: Optimisation and Transition. 

Part 3: Delivery:  Optimise & Transition

Your design and transformation activity will have put in place the new performance measures, processes, people and platforms.  However, until these have been tested in real world conditions for a period, you cannot be sure they are ideally suited to meet your goals.  To deliver the full benefits requires further optimisation and transition to the ideal organisation. 

Optimising the Business

Having carried out your business transformation you now have to carefully monitor the impact of the changes you have made and adjust as necessary to achieve the optimum results.  In particular: 

  • Performance: You should have in place Key Performance Indicators (KPIs) and dashboards for both overall company performance and operational excellence.  These need to be reviewed regularly; usually, in real time and daily for customer processes, and weekly/monthly for the business KPIs.  Use any deltas and variances to feedback into adjustments to ongoing people, process and platform improvement. 
  • Processes: Process monitoring is key to ensuring you maintain an optimal set of working practices and procedures.  Prioritise monitoring those processes that have maximum impact on the KPIs and customer satisfaction. Build in regular review sessions with the process owners and champions, along with the service providers responsible for providing the underlying systems.  
  • People: Having reshaped your human resources in the transformation programme, you need to keep a careful eye on how your staff are responding to the significant change they have been through.  Keeping your staff effective requires constant feedback and motivation.  In today’s world, where staff retention and recruitment are challenging, care must be taken in providing the right conditions and culture to keep your key staff satisfied.  Note this may increase costs which need to be factored into the overall performance calculations. 
  • Platforms: In an ideal world, your IT systems would work perfectly and deliver flawlessly.  However, experience will tell you that IT rarely delivers on its promises, and then only through intensive management and control.  Having put in place the best applications and infrastructure you could find to support your redesigned processes, you now must make sure your service providers deliver not only on the contracted service levels, but also on the inevitable change requests you will need to make to continue to deliver against evolving business requirements.   

Top Tip: There is a balance between constant change and no change that needs to be found. Work out the capacity of your organisation to successfully absorb and adapt to change – If too fast productivity and morale will suffer; too slow and efficiency and effectiveness will diminish.  

Transitioning Through your Business Lifecycle

Having gone through significant effort and activity to acquire and transform the organisation, you now need to consider how to guide your business through its remaining lifecycle.  By now you will have achieved your main acquisition and/or merger goals.  However, no business can survive long term by standing still, so there are several additional phases to consider and plan for:  

  • Stabilise: Having put your optimisation actions in place, you need to allow time for the organisation to bed down the changes you have made.  This will allow your staff, suppliers and customers to understand who you now are and how you operate.  It also provides an opportunity to confirm that you have achieved your initial M&A goals. 
  • Steady State: To achieve the return you are looking for (growth, profit, cash), you will need the acquired company to deliver the results over whatever time period you have set – typically 3 to 5 years.  During this period, you will want to contain costs, so will need to minimise capital investment, unless forced to, or you spot a new opportunity.   
  • Exit:  At some stage, through changes in your own goals, market conditions, or to crystallise your return on investment, you may decide to sell or dispose of the business.  For this the company needs to be geared up to maximise its value to the new acquirer.  This may well be different from the current company operation, so you will need to plan and execute a final transformation to make the business as attractive as possible to its new suitors.  In the case of closing the company, you may wish to maximise the revenue, minimise costs and convert the assets into cash. 

Top Tip: The necessary skills and experience of your leadership team will change through the business lifecycle from acquisition, through transformation, steady state, and towards exit. So be prepared to replace key senior roles along the journey to get the most out of your investment.  


So, in summary, the final stages of your merger and acquisition are focused on getting the required return and optimising the business’s journey through its lifecycle under your ownership.  Contact us for more information on how we can support your merger or acquisition due diligence. 

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Oliver CookGuide to Mergers & Acquisitions Part 3: Optimise & Transition