People in M&A M&A advisory

Delivering the M&A deal 

  • Author
    Jeff Black
    Global Leader M&A Advisory Services, Mercer

Tapping into the unrealized potential of people to deliver M&A deal value creation

The value of people in M&As

Investors and companies undertake deals to create value. Our research indicates that 47% of deals that fail do so primarily due to a lack of strategic planning and execution rigour related to people risks.

This report examines what that means to dealmakers worldwide, drawing from a wide variety of datasets and insights. The significant body of data reveals practical insights from an in-depth survey of deal professionals across the entire transactional spectrum.

3 priorities across the deal life cycle

Value creation is critical and complex. Weaving together insights from survey respondents and case studies, we found the following to be top priorities across deal phases:
  1. Operational stability
  2. Customer and client retention
  3. Bespoke value creation
    • Strategies for acquisitive growth
    • Channel strategy optimization
    • New product development

What are the priorities for people strategy in deals?

Based on the significance of post-close issues that hampered value creation, respondents cite their top areas of focus as:
  • Alignment of leadership
  • Alignment of organizational culture
  • Retention of key employees

What we learned

There is a clear connection between the rigour with which people issues are proactively addressed and the likelihood of deal success. Aligning the deal thesis with how leadership acts, the organizational behaviours the culture reinforces, and the talent skill sets retained and attracted is key.

Key aspects of people strategy that derail deals

When left unaddressed, these key aspects can derail an M&A deal:
19.8%

Leadership team

16%

Organizational culture

9.3%

Lack of change management strategy

Delivering the deal. The unrealized potential of people in deal value creation.

M&A activity is on the upswing as businesses undergo transformations to adapt to this post-pandemic world. How do people risks factor into your deal process?
Download this report
On average, 47% of deals that fail, nearly half do so primarily due to a failure to strategically identify and address people issues.
Delivering the deal. The unrealized potential of people in deal value creation.

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    Contributor(s)
    Jeff Black

    Global Leader M&A Advisory Services, Mercer

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