How often are mergers and strategic business partnerships successful?
The research I’ve gathered shows that 78% of mergers and acquisitions fall apart within three years of conception, and 70% of alliances either fail outright, fall captive to shifting priorities, or achieve only their initial goals. A majority of alliances, 55%, fall apart within three years after they are formed. Q: That’s not exactly encouraging. What kinds of mistakes do smaller companies make when approaching an alliance or acquisition? A: The biggest mistake is that the small company has a rather myopic perspective on a potential alliance. The owner goes, “Wow, look! They love what we’ve got and they’re going to give us money!” But a small firm has to get over that mentality quickly, or else the deal will often go to the detriment of the smaller firm and its employees. There has to be a mindshift, and a more realistic attitude, to make an intelligent business alliance. For instance, the life cycle of both organizations will affect their behavior before and during the alliance. Job
