Chapter 1: Fundamentals

The Case for Agile in M&A

Corporate mergers & acquisitions (M&A) is one of the most complex, information-dense, and unpredictable processes within the corporate sector. Over half of all deals attempted fail to meet projected value, and many of those which initially succeed are ultimately unable to capture intended synergies, resulting in spin-offs and divestitures down the line. The benefits of M&A far outweigh its risks, however. A successful deal can revolutionize a business overnight, producing the kind of stunning transformation that sends stock prices skyrocketing. So, despite its many risks, M&A is a first-line growth strategy throughout the corporate world, and year-to-year deal volume continues to increase.

As the industry grows, M&A practitioners face new and increasing challenges. Over the past decade, the M&A operating landscape has changed dramatically: With a growing number of deals, surges in transaction size, and increased information density, older project management techniques are rendered largely ineffective and ill-suited for modern M&A. Advancements in cloud-based computing and collaborative tech tools, meanwhile, offer an opportunity for organizations to modernize and develop new procedural approaches that grow in accordance with the impressive rate of the M&A market.
It is not uncommon, for example, for firms to be acquiring multiple companies at a time — and with the development of pipeline management software, successfully conducting and closing multiple deals simultaneously is increasingly possible. This epitomizes the changing landscape of M&A and the important role which technology will continue to play.

The old model of M&A as transaction no longer holds. Now, M&A is increasingly shifting toward a transformational model. Acquisitions are made not for scale, but for capability or scope. Where transactional or scale deals move toward increasing market share through cost synergies, transformational deals accelerate growth, as acquisitions bring in new capabilities with emphasis on efficiency and cost effectiveness. Evolving business environments mean that we must disrupt ourselves, or otherwise be disrupted. If you are not willing to transform and grow by expanding your scope, you run the risk of being acquired by a company that is. You'll quickly find yourself owned by someone else, or losing business.

In response to this changing landscape, we have developed a unique, innovative solution: Agile M&A. The Agile methodology is specifically designed to eliminate many of the risks associated with contemporary mergers & acquisition initiatives. A new model for M&A comes with a new mindset: rather than focus on pre-planned cost synergies, Agile M&A is based on continuously discovering and capturing value. Transformational M&A takes a nuanced approach: acquisitions are not merely about homogenizing culture in the relentless pursuit of scale, but about harmoniously integrating the newly acquired capabilities and people in a way that preserves culture, and ultimately preserves value.

The concept was developed with two main premises in mind:

  1. Traditional approaches to project management fail within the context of M&A. The informational needs are too complex and the environmental factors too unpredictable for orthodox programmatic approaches to succeed.
  2. Many of the major pain points and obstacles present during the M&A process can be identified and overcome with the right combination of process, tools, training, and project management approach.

When complemented by the right toolset, the Agile M&A approach enables both sellers and buyers to manage the highly unpredictable M&A processes with maximum efficiency and accuracy.