{"id":571,"date":"2019-10-15T09:25:48","date_gmt":"2019-10-15T16:25:48","guid":{"rendered":"http:\/\/themanwhosoldtheweb.com\/blog\/?p=571"},"modified":"2019-10-15T09:25:53","modified_gmt":"2019-10-15T16:25:53","slug":"how-to-secure-the-promised-revenue-synergies-after-signing-a-merger-deal","status":"publish","type":"post","link":"http:\/\/themanwhosoldtheweb.com\/blog\/2019\/10\/how-to-secure-the-promised-revenue-synergies-after-signing-a-merger-deal\/","title":{"rendered":"How to Secure the Promised Revenue Synergies After Signing a Merger Deal?"},"content":{"rendered":"\n
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Stiff market competition, expansion into new territories, product portfolio extension, and gaining new capabilities are the prime reasons why more and more organizations are seriously looking into the prospects of \u2014 and carrying out \u2014 Mergers and Acquisitions<\/a>. However, only a few M&As achieve their desired revenue objectives.<\/p>\n\n\n\n

Revenue Synergies are a decisive factor in closing such deals. However, identifying precisely where these Revenue Synergies lie and then capturing them isn\u2019t as easy as it sounds.<\/p>\n\n\n\n

A McKinsey study<\/a> comprising of 200 M&A executives from 10 different sectors revealed that all the respective organizations of the respondents remained short of achieving their Revenue Synergy targets (~23% short of the target on average). Securing Revenue Synergies<\/a> is a long-term game. The companies that succeed in securing Revenue Synergies achieve the target in or around 5 years.<\/p>\n\n\n\n

Leaders aspiring to achieve Revenue Synergies should first clarify the objectives from and the schedule of the revenue synergies, lay out the organizational priorities and go-to-market strategies<\/a>, remove obstacles from realizing value, and gain across the board readiness and commitment for the initiative. Organizations that are most successful in securing revenue synergies pay close attention to these 7 guiding principles during the Post-merger Integration<\/a> process:<\/p>\n\n\n\n

  1. Source of Synergies<\/strong><\/li>
  2. Leadership Ownership<\/strong><\/li>
  3. Customer Insight-driven Opportunities<\/strong><\/li>
  4. Salesperson Driven Strategy<\/strong><\/li>
  5. Ambitious Targets and Incentives<\/strong><\/li>
  6. Sufficient Support<\/strong><\/li>
  7. Performance Management<\/strong><\/a><\/li><\/ol>\n\n\n\n
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    https:\/\/flevy.com\/browse\/flevypro\/post-merger-integration-pmi-revenue-synergies-3953<\/a><\/figcaption><\/figure><\/div>\n\n\n\n

    These 7 guiding principles to capturing Revenue Synergies<\/a> are critical for effective integration of two firms after a merger and unlocking potential benefits from the deal. Let\u2019s discuss the first 3 principles in detail now.<\/p>\n\n\n\n

    1. Source of Synergies<\/h3>\n\n\n\n

    The inability of the leadership of the acquiring company to spot major sources of revenue that integration brings in results in losing significant pools of opportunity and failure of M&As. Realizing Revenue Synergies demands a thorough methodology to ascertain and qualify revenue prospects along markets and channels, Go-to-Market Strategies, and developing commercial capabilities. This entails:<\/p>\n\n\n\n