Business Transformation: The Not-So Secret Sauce for Transaction Success

Listen up, transaction pros, because we’re here to provide insight into saving your business from a transaction downward spiral. In mergers, acquisitions and corporate dealing, it’s not about the size of your wallet; it’s about your transformation game. Keep reading to learn why business transformation is the not-so secret sauce to transactions done right.

1. Change is Inevitable – Embrace It!

It’s no surprise that in a fast-paced world of business transactions (we’re talking fast like closing out of a browser tab if the page doesn’t load in 15 seconds), change is the only constant. Organizations that aren’t onboard to accept this will inevitably get passed over while their competitors speed around them. Successful business leaders understand that embracing change during and after a transaction can help keep them ahead of the game. And in our humble opinion, the strongest tool you can have in your pocket is change management.

Change management allows business leaders to address and invest in the people aspects of a transaction early on. This helps prevent miscommunication, lost productivity and cultural misalignment. During this early step, use an organized methodology to assess, analyze, manage and communicate changes to your existing staff and those that will join the company through the acquisition. Proactively establish expectations and plans to respond to the reactions of team members, rather than retroactively speaking to concerns from unsuspecting team members.

2. Transform Like a Pro

Studies show that 70% of projects hit roadblocks due to failing to involve, engage and prepare employees to adapt to new ways of working. Avoid pushback and unwanted productivity dips during or after a transaction by leveraging business transformation methodologies. This will include strategies that enhance the employee experience, ranging from streamlining organizational support, optimizing new and existing technology, to evolving employee focus and restructuring.

3. Due Diligence with a Dash of Efficiency

Beyond a people and culture fit, the due diligence process is also leveraged to analyze a company’s overall productivity. We’re not just talking bare bones, like numbers and contracts. We mean finding out if the organization you’re buying operates as a well-oiled machine. By hosting a short-term Kaizen event, productivity issues lurking under the surface can be revealed and help you more accurately assess how much improvement will be required in the future. (For those of you now searching ‘Kaizen event’ in Google, this is where a cross-functional team comes together for a time-limited effort to analyze challenges, identify inefficiencies and implement improvements.)

4. New Structure, New Profitability

Once the deal is approved, it’s not all bubbly and high-fives. It’s time to align your people to the new structure, uncover operational proficiencies and eliminate inefficiencies. The road to profitability is paved with waste-busting intentions. Address the following wasteful elements through the enjoyable acronym “DOWN TIME.”

  • Defects
  • Overproduction
  • Waiting
  • Non-utilized talent
  • Transportation
  • Inventory
  • Motion
  • Extra-processing

These are top areas that should be evaluated for improvement.

5. Post-Close Focus: Get it While it’s Hot

The excitement of sealing the deal can sometimes lead to dangerous complacency. To realize the full potential of a merger or acquisition, you need to keep your focus sharp post-close. Consider these opportunities:

  • Organization Restructuring: It’s time to restructure and take advantage of synergies. Who said synergy was just for corporate buzzword bingo?
  • Process Reengineering: Trim the fat, streamline processes and cut costs. Efficiency is the name of the game.
  • Harmonize: Eliminate redundant programs, processes and systems. Why manage chaos when you can have order?

So, there you have it, folks. In business transactions, it’s not about who has the biggest wallet; it’s about who’s ready to embrace change and transform. Whether you’re merging, acquiring or just looking to improve your current portfolio’s operations, remember that success lies in the art of transformation. This is the not-so secret sauce to a profitable transaction. The other thing that might help? Talking to our team of business transformation experts, who can assist you on your next deal.

This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. In addition, this publication may contain certain content generated by an artificial intelligence (AI) language model. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.

About the Author