Discover the role that ERP software plays in effective acquisitions.
The Professional Services sector is growing. Marketing and communications (marcomms) agencies are a proactive player. Investors in marcomms companies are growing in number and scale; from global conglomerates to regionalised start-ups.
“Aside from the usual acquirers like WPP, we’ve also seen deals concluded by the likes of YouGov, Norwegian data giant Confirmit, publisher Future, comparison site broadbandchoices.co.uk and now LDC – there are many others we’d never have considered. Expect to see more of this as 2014 progresses.”
How outside investors are taking on the marcomms giants when it comes to acquisitions, The Drum
But acquiring another business, whatever the size, is complex and not without risks. So how can your marcomms agency make a successful acquisition?
Flawed objectives equal failure
First, you have to understand what challenges you are up against. In ‘Why Acquisitions Fail - the 20 Key Reasons’ media and education specialists Pearson explain how acquisitions fail for a number of reasons – largely related to financial, commercial or strategic objectives:
- Flawed understanding of the new business.
- Flawed deal management.
- Flawed integration management.
And while there are many solutions to each – not least good planning, good management and good advice – having a clear all round view of the business you are planning to acquire must be high on the list.
Pearson goes on to say that companies looking to grow through acquisition must have a good understanding of what they’re investing in. If you get it right, the rewards outweigh the risks.
“…the upside of successful acquisitions can be substantial. They can make money in their own right and they can also bring commercial or tactical advantage to the enlarged acquirer. The proof lies in the highest rated companies. Very few of the world’s top businesses have achieved success without acquisition.”
Clear rounded view equals success
The key to growing your business and acquiring new companies is to have a clear, rounded 360 degree view of your own organisation.
Surprisingly, an IDC global report on Managing Your Consulting Firm for Growth highlights that the majority (around 80%) of best-of-breed consulting firms don’t have industry-specific project management systems that give the visibility they require. This is despite the demonstrated advantage that they can deliver over generic business management systems.
Project-based ERP software, designed specifically for Professional Services firms, gives your marcomms company the tools to make the right decisions in core business areas - such as the business lifecycle process and profitability. This provides a better insight into and understanding of any new business and potential acquisition opportunities.
By consolidating your systems and communicating effectively with all parts of your business, you can ensure the introduction of a newly acquired organisation doesn't disrupt business as a whole. ERP software makes growth through acquisition possible and painless – win:win!