The area I would like to focus upon in this post is in the preparation and planning stage what I call the “Formulate Stage”.
5 Stage Acquisition Process
In the process that I use for acquisitions there are 5 major stages these are:
- Formulate –
- Locate –
- Investigate -
- Negotiate –
- Integrate -
Getting the correct work completed during the formulate stage is critical. Now this next point is very important: This work will be twice as difficult and take you three to four times longer than you expect. So many companies I have come across that have failed to reach their acquisition objectives have made major mistakes in this step of the process and it has cost them dearly further down the line.
Once you have invested weeks and months in an acquisition it can be difficult if not painful to back away, just because you made a mistake back at the start. Many acquisitions gain a momentum of their own.
Communication and Process are Key!
During the early “Formulate” stage it is important that a clearly defined profile of the ideal company is created and communicated with all the key influencers and stake holders. I have a process to achieve this that has been refined over the years that I call “Success Profiling” which is a methodology for pulling out the essential questions that need to be asked sooner rather than later.
The key steps in the process must also be agreed and communicated to avoid later confusion and this must be updated throughout the acquisition process to maximize your chance of success.
The Information that is gathered and the processes that are agreed and put in place before commencing a structured search will be a major factor in the final success of the acquisition not just immediately following the acquisition but 1, 2 or 3 years later when you really want to reap the benefits.
Want to Know More?
If you would like to know more about all the steps in the formulate stage or details on the rest of the process just send me an email (Mark at Documentboss.com) . It is such an important first step the vast majority of acquisitions failures can be back tracked to failure in the initial “Formulate” stage of the acquisition.
And Finally………. for those who decide that planning for your next acquisition is just a waste of time and gets in the way of business, I have a recommendation for a new hobby. Have a look at this http://vimeo.com/1778399 I think you will enjoy it! Give the video one minute to really get going and then you will understand.