Onboarding mergers and acquisitions efficiently

Reasons mergers and acquisitions struggle to show value
and how you can overcome these for future success.

M&A can offer exciting growth opportunities fast. But, many organizations fail to make mergers work effectively.

There can be numerous reasons for this: clash of cultures, misalignment in products or markets, or inability to bring together people and systems to ensure one source of data truth.

We’ll look at some of the reasons mergers and acquisitions struggle to show value and how you can overcome these for future success.

Why mergers don’t always show value

The reasons for acquiring another organization are numerous, from the opportunity to enter a new market or new product stream to reducing competition. However, most organizations acquire a company in order to grow – grow their market share, grow their customer base, grow their product portfolio.

And while a merger or acquisition can look great on the balance sheet, the reality can be very different.
Just some of the reasons mergers and acquisitions can fail include:

^1.^{Lack of due diligence}

In a 2024 Grant Thornton report, interviewing 189 US-based M&A professionals who had completed over 1,300 deals in 2023 — nearly half said their deals involved some type of accounting dispute.

Solution

To avoid confusion, ensure vague language is not used during earn-out and working capital calculations, and agree up front on which metrics will be used for measurement and ensure consistency when reviewing those metrics, along with any deadlines for adjustments.

How can Unit4 help?

_2._{Inefficient onboarding}

Bringing together different back-office systems can be challenging. Data can be measured and reported in different formats, creating a mismatch of information for KPIs and resulting in incorrect data being presented to senior management or the board. Teams can find themselves spending time trawling through data manually to correct inconsistencies, which in turn can lead to frustration and disengagement.

Solution

Invest in tools that will enable data to flow in from various sources into one back-office system, such as an ERP that simplifies onboarding for new entities and will grow as the organization grows.

Learn how Unit4 ERP supports efficient onboarding

_3._{Misalignment of cultures}

Often overlooked by many organizations, but a mismatch in cultures can lead to an exodus of talent, leaving the acquiring company with a product/service that they’re unable to develop and/or sell due to lack of staff with the relevant skills and industry knowledge. As a result, long-term plans can be severely hampered.

Solution

Don’t underestimate the power of aligning cultures. Look at the best
practices employed across both organizations – what can you implement
that will benefit all parties? What practices could be replaced? Where does talent lie?

Ensure that the right people are leading teams, not just those from the acquiring company. While organizations often want to see a quick return on their investment, integrating teams and departments may require a more considered approach.

How Unit4 ERP supports bringing people together

_4._{Lack of empathy for the acquired employees}

Similar to the misalignment of cultures, it can be easy to overlook how disruptive and discombobulating it can be for employees within the acquired organization. People are human, and fear and uncertainty are likely to set in. If this isn’t managed empathetically and proactively, employees may leave, or even worse, quietly quit their jobs.

Solution

Involve employees as much as possible. Ensure there is constant and consistent communication. Look at empowering all employees as much as possible. When people feel respected and valued in their roles, they will take ownership and responsibility for their contributions to the business.

Providing recognition schemes and the ability for employees to give feedback in a safe way
can help both mitigate any issues, as well as improve working practices and even foster a
path for employees to suggest solutions to business challenges.

How Unit4 ERP supports bringing people together