M&A Lessons Learned

Supply chain management is the key to realizing merger and acquisition synergy savings

May 13 - Supply Chain & Demand - Oftentimes the motivations for a merger and/or acquisition are the savings and cost synergies that can be generated from the increased scale and overlapping operations of the combined companies. These synergies generally come from two areas: internal headcount and external vendor spend. Due to the supply chain management organization's focus on optimizing vendor relationships and internal spend patterns to reduce costs and increase productivity, SCM is well-positioned to lead the external vendor spend effort with a structured synergy capture program to maximize savings.

Embarking on a merger or acquisition without a strategy or, better yet, a formal program to realize the potential synergies as effectively and efficiently as possible can ultimately lead to failure. Because the synergies are crucial to the future viability of the combined company, the respective SCM organizations should have a leading role in identifying the synergy savings required for the merger or acquisition to succeed. Read More.