PIC No. 7:
• Title: The Synergy Solution: How Companies Win the Mergers and Acquisitions Game
• Authors: Mark Sirower and Jeff Weirens
• Publisher: Harvard Business Review Press (416 pages, March 15, 2022)
• Management Bucket #3 of 20: The Strategy Bucket
Welcome to Issue No. 7 of PAILS IN COMPARISON, the “little brother” of John Pearson’s Buckets Blog. This blog features my “PICs”—short reviews of helpful books—with comparisons to other books in my 20 management buckets (core competencies) filing system.
“In most organizations, PMI is not a core skill.”
Read just one line in this new book on mergers and acquisitions—and you’re hooked: “In most organizations, PMI is not a core skill.”
PMI (post-merger integration) torpedoes many, many mergers.
But let me back up a bit. A recent Wall Street Journal article trumpeted a radical idea for churches—perhaps smaller churches should merge with larger churches. “A Thriving Church Can Save a Faltering One,” by Ron McCoy, suggests that “a congregation merger might sound radical, but the evidence shows it can work.”
While there have been successful church mergers over the decades, not every merger works. (The egos and the logos are formidable obstacles.) While I have sometimes suggested mergers to clients (both churches and nonprofit organizations), I’ve actually seen few takers. Now I understand why. I had never read a serious book about the art and science of mergers and acquisitions…until now.
The Synergy Solution: How Companies Win the Mergers and Acquisitions Game, by Mark Sirower and Jeff Weirens—while written for the marketplace—has practical wisdom for both nonprofits and for-profits.
The authors warn leaders about the “synergy trap” in proposed mergers and what to do about it. “Our hypothesis is that these systemic failures are the result of a lack of:
• Preparation
• Methodology, and
• Strategy.”
After the helpful introduction, I couldn’t resist reading Chapter 9 next, “Can the Board Avoid the Synergy Trap?” Here they deliver “Tools for the Board” and caution enthusiastic board members to exercise their “primary fiduciary duties of loyalty and care in fulfilling their responsibilities.” The authors urge board members who are considering M&A opportunities, to ask the right questions and have the right discussions “…given that so many bad deals make it out of the boardroom.”
Wow. There is SO much in this robust book. In reminding board members of the common pitfalls of mergers, they note, “As we discussed at length in chapters 6, 7, and 8, a post-merger integration (PMI) is a highly complex process. The pace, importance, and sheer number of decisions that will need to be made for a merger far outstrip the normal rate of decision-making. Combining two organizations with distinct cultures while trying to manage business as usual and protect the day-to-day cash flow is daunting.” And they add this kicker:
“In most organizations,
PMI is not a core skill.”
Whether you’re a board member of a for-profit or a nonprofit, if this short review doesn’t scare you off, then be sure every board member reads this book. The authors have just dramatically increased your chances of a successful merger. But more likely, they’ve helped you say NO to an unsuccessful merger. (Be sure to send them a thank you note!)
PAILS IN COMPARISON: Reading this book reminded me of several favorite books in the Strategy Bucket:
NONPROFITS:
• Well Connected: Releasing Power, Restoring Hope Through Kingdom Partnerships, by Phill Butler (read my review)
• Rooting for Rivals: How Collaboration and Generosity Increase the Impact of Leaders, Charities, and Churches, by Peter Greer and Chris Horst, with Jill Heisey (read my review)
FOR-PROFITS:
• Scaling Up: How a Few Companies Make It…and Why the Rest Don’t – Mastering the Rockefeller Habits 2.0, by Verne Harnish (read my review)
• Turning the Flywheel: A Monograph to Accompany Good to Great (Why Some Companies Build Momentum and Others Don’t), by Jim Collins (read my review)
TO ORDER FROM AMAZON, click on the title for The Synergy Solution: How Companies Win the Mergers and Acquisitions Game, by Mark Sirower and Jeff Weirens. Listen on Libro.fm (12 hours, 7 minutes). For more book reviews, visit John Pearson’s Buckets Blog and subscribe to Your Weekly Staff Meeting. (And thanks to Fortier PR and Harvard Business Review Press for sending me a review copy.)
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