Creating M&A value through a capabilities lens
To the outside world, a company’s products and services are its most visible activities. But too few companies create a portfolio that truly aligns with their strategy and succeeds in driving sustained outcomes. Instead, many companies compose portfolios based on short-term financial performance and then attempt to force a strategy to fit around that portfolio.
Mergers and acquisitions are a powerful way to modify a company’s portfolio and generate both long-term value and resilience. They provide companies an avenue to growth, and, if planned properly, to the further development of core strengths, as well.
At Strategy&, our data-driven community of solvers has found strong evidence that capabilities-driven deals—those that leverage the buyer’s key strengths or help enhance them—produce significantly better results, on average, than deals with limited capabilities fit.
Through our in-depth research and tech-powered analyses, our team of strategy experts empowers companies to follow this capabilities-driven approach to portfolio and M&A strategy and focus on the things they do better than anyone else.
The result? Structural competitive advantage that allows companies to carve out a formidable position in the market, create steep barriers to entry for competitors, and open up good growth that lasts.
Ready to optimize your portfolio and deals? Let’s talk.
After a pandemic-induced M&A slowdown, there’s been a surge of deals around the world, and, post-pandemic, the stage is set for more. But as leaders pursue corporate acquisitions, what can they do to ensure the resources they invest produce worthwhile returns?
To answer this question, we collected and examined 800 deals, including the 50 largest acquisitions in 16 different sectors completed over the past decade.
Click below to discover the results of the research, including more on the one key factor that differentiates a successful deal: capabilities fit between target and buyer.
Want to know whether your company has the right capabilities to compete and win in the market?
Our Capabilities Assessment Tool is an online diagnostic designed to ask your employees to rate your company’s performance (versus industry performance) in a number of industry-specific capabilities. The tool then defines how important each of these capabilities is to your company’s success. Contact us to get started.
