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Article
Publication date: 1 June 2003

Orit Gadiesh, Charles Ormiston and Sam Rovit

When merging two companies, after the deal is signed the CEO faces few challenges more risky than integrating the businesses to capture maximum value. Speed is essential…

3718

Abstract

When merging two companies, after the deal is signed the CEO faces few challenges more risky than integrating the businesses to capture maximum value. Speed is essential to successful merger integration. But it is not everything. Only 25 to 50 percent of deals create shareholder value. This is often because those managing the integration process do not know how to make trade‐offs between speed and careful planning. To keep the value of merger from evaporating, leaders need to manage the integration process actively and steer a course that leads the new organization to its stated strategic goals as swiftly as possible. Start with the strategic goals – there are two general types of mergers: (1) efficiency deals that “play by the rules” (achieve performance improvement in a merger that will have high functional overlap and high predictability of value); and (2) transformation deals that "transform the rules” (low overlap and low predictable value). Top management needs to articulate the purpose of a deal and its strategic rationale long before the merger is consummated. Four rationales are offered and discussed, the first two rationales apply more to type 1 deals and the second two more to type 2 deals. (1) Merging to capture the benefits of scale. In this type of merger, the longer you take, the more risk you incur. Success depends on very early identifying the key people to lead and removing those who will block the process. (2) Merging to expand into adjacent markets, customers, and/or product segments. The big prize comes from revenue growth. Teams from both sides must work together to develop a new marketing plan for the combined company. (3) Redefining the business for a new direction. As a framework for judgments, consider using these reference goals: focus on leading‐edge customers, make decisions quickly, and look for ways to lead change in the marketplace. (4) Re‐inventing an industry. Two initiatives in parallel are required: typical short‐term objectives (cost reduction, consolidation, divestment, etc.) and long‐term direction objectives for the new business. Details from the AOL Time Warner and the Citigroup merger cases are cited as examples. Several examples taken from Cisco System’s many mergers are cited to illustrate process points and insights.

Details

Strategy & Leadership, vol. 31 no. 3
Type: Research Article
ISSN: 1087-8572

Keywords

Article
Publication date: 1 June 2002

Orit Gadiesh, Robin Buchanan, Mark Daniell and Charles Ormiston

The legal framework for extending innovation beyond the corporate boundary is the Strategic Alliance (or partnership) Agreement. Before entering into any type of alliance…

2007

Abstract

The legal framework for extending innovation beyond the corporate boundary is the Strategic Alliance (or partnership) Agreement. Before entering into any type of alliance involving a joint development arrangement, every company whose core assets are comprised of intellectual property should conduct an internal Intellectual Property Audit. Make certain what you own (or control through licenses) it may be more or less than you think. The second phase of the Intellectual Property Audit is to make sure your Intellectual Property Assets are protected. Begin drafting the Alliance Agreement by articulating the goals of the alliance as specifically as possible. Define the product to be developed or area to be explored in detail. The Alliance Agreement should define the what technology is proprietary to each party. Determine in advance who collects the money, how is the money split, and who does the accounting. Each party should be individually responsible for the cost of defending any claims of infringement. Options can be tied to the development and testing milestones that allow you to get out of the deal entirely or reduce it from an exclusive to a non‐exclusive arrangement.

Details

Strategy & Leadership, vol. 30 no. 3
Type: Research Article
ISSN: 1087-8572

Keywords

Article
Publication date: 1 February 2002

Orit Gadiesh, Robin Buchanan, Mark Daniell and Charles Ormiston

Mergers may be the truest test of great leaders.

Abstract

Mergers may be the truest test of great leaders.

Details

Journal of Business Strategy, vol. 23 no. 2
Type: Research Article
ISSN: 0275-6668

Content available
Article
Publication date: 1 August 2002

Orit Gadiesh and Charles Ormiston

1813

Abstract

Details

Strategy & Leadership, vol. 30 no. 4
Type: Research Article
ISSN: 1087-8572

Content available
Article
Publication date: 1 December 2003

Orit Gadiesh, Stan Pace and Paul Rogers

951

Abstract

Details

Strategy & Leadership, vol. 31 no. 6
Type: Research Article
ISSN: 1087-8572

Article
Publication date: 1 May 1997

Roger Hewson

The Strategic Leadership Forum's Conference in Washington, D.C. (April 27–30, 1997) was a showcase of advanced leadership insights. More than 30 top management experts…

1553

Abstract

The Strategic Leadership Forum's Conference in Washington, D.C. (April 27–30, 1997) was a showcase of advanced leadership insights. More than 30 top management experts told of their most recent experiences and their latest theories about meeting the management challenges of the next decade. There were many real‐life examples of how the old, “control” style of leadership, which grew out of the Industrial Era, is being replaced by the newer leadership styles that match the realities of the Knowledge Era.

Details

Strategy & Leadership, vol. 25 no. 5
Type: Research Article
ISSN: 1087-8572

Article
Publication date: 1 August 2001

Orit Gadiesh, Dan Haas and Geoffrey Cullinan

Increasingly, companies see mergers and acquisitions as a strategic tool and expect to benefit from synergies – improvements in competitiveness, customer value, or product…

1873

Abstract

Increasingly, companies see mergers and acquisitions as a strategic tool and expect to benefit from synergies – improvements in competitiveness, customer value, or product innovation – that can be achieved by integrating two entities. This added complexity means executives have a more difficult task trying to identify, value, and negotiate closure on attractive deals. Also, as investment banks pitch deals more aggressively, executives fear being trumped by competitors and thus feel more pressured to act. To improve the chances of success in merger and acquisition efforts, the authors offer suggestions for screening potential candidates strategically, setting the “right” price, and negotiating preemptively to outrun competitors.

Details

Strategy & Leadership, vol. 29 no. 4
Type: Research Article
ISSN: 1087-8572

Keywords

Article
Publication date: 9 January 2007

Orit Gadiesh, Paul di Paola, Luca Caruso and Oi Chung Leung

Alert global firms that China plans to become an incubator for top companies rather than simply a low‐cost manufacturing base.

2445

Abstract

Purpose

Alert global firms that China plans to become an incubator for top companies rather than simply a low‐cost manufacturing base.

Design/methodology/approach

Outline the strategies for MNCs to penetrate China's expanding market and defend their global position.

Findings

MNCs have figured out the six keys to success: differentiate your products, bring production costs down in line with local cost structures, design offerings for local tastes, create smart partnerships, develop close government relationships and hire strong, “China‐fluent” management, both local and expatriate.

Practical implications

Actions for MNCs to take: Develop Chinese toehold operations into self‐standing and profitable units. Dramatically reset the standards for cost competitiveness. Protect the value segments in your core markets. Treat human resource management as a strategic global function. Accelerate and globalize R&D. Ensure that each business is delivering what it promises to core customers.

Originality/value

Assesses the strategic strengths and weakness of MNCs and potential Chinese rivals.

Details

Strategy & Leadership, vol. 35 no. 1
Type: Research Article
ISSN: 1087-8572

Keywords

Content available
Article
Publication date: 1 August 2001

Marilyn Norris

200

Abstract

Details

Strategy & Leadership, vol. 29 no. 4
Type: Research Article
ISSN: 1087-8572

Content available
Article
Publication date: 1 October 2003

181

Abstract

Details

Strategy & Leadership, vol. 31 no. 5
Type: Research Article
ISSN: 1087-8572

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