Over the last year, there seems to be growing interest and efforts focused on exploring and executing mergers and acquisitions within our sector. Three examples of creative forms of collaboration across our membership community include: DAI and IntraHealth; RTI acquiring IRG from Engility this year; and Grameen and Freedom From Hunger in 2016. In our discussions across the membership community, many expect this activity to continue as leaders and boards continue to ask the key questions: Can a merger or acquisition accelerate our strategic goals? Can we deliver more impact in a closer collaboration than alone? And, finally, what can we do to better ensure success?
Multiple studies from the commercial sector over the years have pointed out that mergers have a higher than expected failure rate in their ability to create and sustain long-term value, even with the greater abundance of resources and capital. While these studies may seem daunting, there are many ways to increase the odds of success in the design and execution of a merger or acquisition, and a favorable external environment also helps. In addition, many characteristics our sector embodies may also increase success.
Successful organizations rest not only on strategy and talent, but also on a sense of purpose and belonging, especially in creating a new organization following a merger. Our community, with its strong social purpose, commitment to values, focus on diversity and inclusion, and passion for results embodies both purpose and belonging, and that has allowed our organizations to adapt and thrive in adversity. They may also help us be more successful in our mergers and acquisitions. [Read more…]