Post Merger Control - An examination of existing tools for success measurement
Zeppelin University
Department Corporate Management and Economics
Controlling
Paper
Post Merger Control
An examination of existing tools for success measurement
Degree program:
Corporate Management and Economics, Spring Semester 2009
Content
1. Introduction- Why do mergers fail?...........................................................................3
2. The challenge of merger control and success measurement
“If you cant measure it, you cant manage it”............................................................4
3. The Integration Balanced Scorecard ..........................................................................5
3.1 The Integration Dashboard ...................................................................................8
3.2 7 C Model ............................................................................................................10
4. Conclusion ................................................................................................................11
5. Bibliography......... .....................................................................................................12
3
1. Introduction- Why do mergers fail?
The fourth Mergers & Acquisitions (M&A) wave1 is characterized by the extensive use of dept capital to finance merger deals and a very strong orientation on capital markets.
During this development stakeholders became very influential and demanding actors- with great expectations of high returns and the accomplishment of transactions in an enormous speed. This causes a strong concentration on overestimated synergies and high yields2, but lead to an underestimation of functional and sustainable controlling systems, although they play a very important role in reimbursing expenses and capturing integration costs. These shortcomings are the main reason for mergers failure. But for many managers this fact still remains unrecognized and explanations are frequently seen in
Department Corporate Management and Economics
Controlling
Paper
Post Merger Control
An examination of existing tools for success measurement
Degree program:
Corporate Management and Economics, Spring Semester 2009
Content
1. Introduction- Why do mergers fail?...........................................................................3
2. The challenge of merger control and success measurement
“If you cant measure it, you cant manage it”............................................................4
3. The Integration Balanced Scorecard ..........................................................................5
3.1 The Integration Dashboard ...................................................................................8
3.2 7 C Model ............................................................................................................10
4. Conclusion ................................................................................................................11
5. Bibliography......... .....................................................................................................12
3
1. Introduction- Why do mergers fail?
The fourth Mergers & Acquisitions (M&A) wave1 is characterized by the extensive use of dept capital to finance merger deals and a very strong orientation on capital markets.
During this development stakeholders became very influential and demanding actors- with great expectations of high returns and the accomplishment of transactions in an enormous speed. This causes a strong concentration on overestimated synergies and high yields2, but lead to an underestimation of functional and sustainable controlling systems, although they play a very important role in reimbursing expenses and capturing integration costs. These shortcomings are the main reason for mergers failure. But for many managers this fact still remains unrecognized and explanations are frequently seen in
Bibliography: Drews, Hanno (2002). ”Instrumente des Kooperationscontrolling”. 2. Aufl. Wiesbaden: Universitätsverlag GmbH. Gleißner, Werner (2004). “Future Value- 12 Module für eine strategische wertorientierte Unternehmensführung“.1 Huch, B., Behme,W., Ohlendorf, T (2004). “Rechnungswesenorientiertes Controlling- Ein Leitfaden für Studium und Praxis Jansen, Stephan A. (2001). “Mergers & Acquisitions- Unternehmensakquisitionen- und kooprationen“.4 Jansen, Stephan A. (2004). “Management von Unternehmenszusammen-schlüssenTheorien, Thesen, Tests und Tools“.1. Aufl. Stuttgart: Klett- Cotta Verlag Mitleton-Kelly,Eve (2006) Picot, Gerhard (2002). “Handbook of international Mergers and Acquisitions“. 3. Aufl. Wall, Friedrieke (1999). ”Planungs- und Kontrollsysteme. Informationstechnische Perspektiven für das Controlling