Just because a company is smaller than an M&A-eating behemoth the size of Procter & Gamble doesn’t mean it can’t pick up a few morsels of wisdom from its experience.
That’s the word from Mitchell L. Marks, professor of business at San Francisco State University, and an M&A consultant on the side. The same lessons apply, whether the deal steals headlines or not. “Many CEOs of midsize and smaller businesses deny or think they are immune to the perils of M&A difficulties,” says Marks, author of Joining Forces—Making One Plus One Equal Three in Mergers and Acquisitions. “They’re not, and in some cases there’s more to be concerned about.”
He explains that small and midsize company “lack the luxury of a large corporation’s corporate staff and the ‘bench strength’ of up-and-coming, high-potential junior executives to manage the merger while keeping the business running.” In such cases, “the acquiring entity can be overwhelmed by the rigors and requirements of M&A integration,” Marks says. “Don’t delude yourself that doing the deal is the hardest part of a transaction. It isn’t. As one of my CEO clients said, buying a company is fun; integrating it is hell.”
What’s the secret then in adding up two companies’ strengths and synergies and not ending up with a negative number? “A CEO of a midsize company needs to understand first the synergies and cost savings represented by the deal, and then not overpay for this value,” says Michael Burdi, portfolio consultant at corporate performance advisory firm Applied Finance Group. “If you pay a great price and have great synergies, you will likely succeed at adding value. If you pay a fair price and have great synergies you will likely get an average return. Valuation is the closest thing to the law of gravity that we have in finance. It is the primary determinant of longterm returns.”
Practice makes perfect, Marks chimes in. “The best and smartest players in the M&A game have done multiple deals—they learn from their mistakes, and know what they can do on their own and what they need from external consultants,” he says. “The CEOs of large companies with great M&A track records also leave their egos at the door, knowing they can’t possibly bat 1,000 in this game, given the challenges of integration. That doesn’t stop them from trying, however.”
Read: 4 Secrets of Great Deal Makers: Making the Most of M&Amp;A Deals.
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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:
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.
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.
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.
