ACQUISITION MANAGEMENT
By
Sam Boyer
A significant body of evidence exists indicating companies that acquire or
merge with others generally under perform when measured against the
benchmarks of their own industry. The beer distribution industry is not
immune from this occurrence.
The primary cause for this lack of performance by recently merged
companies tends to be the poor job they do in the post merger integration
process.
The acquisition or merger process does not end at the closing table;
it's only beginning. In a significant number of client engagements shortly
after they made an acquisition or completed a merger I have found there to
be little forethought as to how to make the two entities into one seamless
operation. Operational problems took center stage, sales lagged, and
customer service suffered....all do to the lack of planning by the buyer.
This planning must start even before the initial negotiations
with the
seller. You must work with your key managers and advisers to solidify a
plan of how the acquisition will be systematically integrated into your
organization. Without this plan early in the process you will make many
changes over and over.....frustrating employees and customers....and not
accomplishing your goal of a single profitable organization.
Communications is of primary importance in the integration process.
From the beginning you must involve those individuals that will be
responsible for the day to day operation of the new organization. Without
their involvement they will not "buy into" your plan. Then your
plan is doomed. Not only do you need to involve your key managers and
professional advisers you must also involve the key managers of the
acquired company.
Work together as a team. Review all aspects of both companies and
identify every point that must be addressed in the integration process.
Whatever you do....don't go it alone. Too much secrecy will limit your
ability to manage a smooth integration process and increase the fear of
change. Fear of change is not limited to the employees of the acquired
company. Many of the customers will also need to have their fears reduced
and assured they will receive product and merchandising support to satisfy
their needs.
The post merger integration plan will start with a measure of the
market workload for the combined organization. This measure will have to
consider all the accounts to be serviced, their combined case/keg volumes,
selling system (pre-, driver-, or tel-sell), and frequency of service.
From this measure of market workload you will be able to determine the
number of sales and delivery routes necessary to service the accounts.
After this critical step is completed you can begin on the following:
