Close this search box.
Close this search box.

How to Squeeze New Earnings From Old Acquisitions

A growing body of research has shown that 50% to 90% of acquisitions fail to pay off for acquirers. This means that traditional integration methods are not working. There are many reasons an acquisition might fail, but two recurring mistakes are the order and the depth at which the integration is tackled.

In the traditional approach, an organizational structure is formed immediately upon closing the deal, and shortly thereafter, an announcement is made that names the executives who will fill the top 30–50 positions. Since the acquirer’s leadership team knows very little about the qualities of the acquiree’s management team, they make these decisions based on imperfect data: resumes, performance reviews, and politics. This not only may result in the wrong people retained, it also leaves employees feeling like merit doesn’t matter.

Next, highly visible duplications of systems are eliminated, including branch networks, brands and large suppliers. Integrating these elements into a single operating platform is supposed to capture most of the expected efficiencies, while further incremental efficiencies would be squeezed out over time. In reality, this leaves significant complexity and inefficiency deep in the organization. Successful acquisitions do not stop at the big system integrations.

Here is a better way to ensure a successful integration, and ultimately, uncover opportunities for new revenue.

  1. Let duplicate management co-exist … for awhile. During the redesign of processes, managers’ natural inclination toward leadership, innovation, collaboration and execution will come to the surface. That information will next be used to develop the new company’s organizational structure. The cost of carrying duplicate management teams for a short time is a small investment to make in building the best leadership team for the future.
  2. Name a “One Company” 100-day task force reporting directly to the CEO. This task force should have high-potential junior executives representing all major areas of the company from both the acquirer and the acquiree. These people should have a passion for improving the company and for replacing disparate territorial behavior with one company behavior.
  3. Once your acquisition has been integrated, have the task force identify the places where duplication and complexity created by old acquisitions still exist—multiple systems, different ways of handling transactions, minor variations of legacy products and services, vendors and purchases that should be consolidated, etc. This task force will uncover many areas ignored by the traditional approach. These can now be targeted by specific teams to fix. If your acquisition has not yet been integrated, then take the broader approach described in the next point.
  4. Create teams of both acquirers and acquirees across the entire entity to work closely with the One Company task force. In 100 days, these teams should jointly design the most efficient processes used every day by the people closest to the work and closest to the customer. These activities will drive most of the expenses and revenues of the company.

In some cases, the acquirer has the best process; in others the acquiree has the best process, and many times, a new process must be created that leverages the new strengths of the combined entity. Getting these activities right is often essential for an acquisition to pay off.

Another benefit of joint teams is that as both sides work and make presentations together, a unified culture begins to form naturally.

Why only 100 days? Because short, intense, campaigns create urgency and focus.

CEOs who dive deeper for acquisition efficiencies, as well as missed revenue opportunities, add millions in earnings, reduce complexity, and increase employee engagement. They also reinforce a culture of “one company” going forward.




  • Get the CEO Briefing

    Sign up today to get weekly access to the latest issues affecting CEOs in every industry
  • upcoming events


    Strategic Planning Workshop

    1:00 - 5:00 pm

    Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process

    Executives expressed frustration with their current strategic planning process. Issues include:

    1. Lack of systematic approach (70%)
    2. Laundry lists without prioritization (68%)
    3. Decisions based on personalities rather than facts and information (65%)


    Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns.  They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning.  Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process.  This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented.  If you are ready for a Strategic Planning tune-up, select this workshop in your registration form.  The additional fee of $695 will be added to your total.

    To sign up, select this option in your registration form. Additional fee of $695 will be added to your total.

    New York, NY: ​​​Chief Executive's Corporate Citizenship Awards 2017

    Women in Leadership Seminar and Peer Discussion

    2:00 - 5:00 pm

    Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations. 

    Limited space available.

    To sign up, select this option in your registration form. Additional fee of $495 will be added to your total.

    Golf Outing

    10:30 - 5:00 pm
    General’s Retreat at Hermitage Golf Course
    Sponsored by UBS

    General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.

    The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.

    To sign up, select this option in your registration form. Additional fee of $295 will be added to your total.