Secret Marketer: One plus one doesn’t make three

Secret Marketer

I was recently invited back to my old university to hear a speech by the CEO of a leading pharma business about how he, a fellow alumnus, had moved from spotty-faced teenager to head one of the most successful companies in the country.

Apart from the CV-envy I tried to stifle I was fascinated by some things he said – not least about mergers and acquisitions. I have worked for three brands that have been acquired (one twice), another that was created as a joint venture between mega-brands, two that have floated on the FTSE, one that was the result of a merger between the No.2 and No.4 brand in its sector and I have supported the acquisition of over a dozen smaller entities, so I have form here.

I am also well aware of the old adage that the best way to make a small business is to start with a large business and wait – in other words, most acquisitions fail.

I reflect on what would happen if I refused to let my CEO… onto my office floor or to comply with the latest finance spreadsheet or HR request

Well, this particular CEO has come to an interesting conclusion – namely, the only way to make an acquisition or merger work is not to assimilate, but to retain the other outfit’s brand, culture, values and – intriguingly – most of the processes that made it a success. Now, just about every merger and acquisition I have been involved with has been predicated on the level of synergies from crashing the entities together.

I was musing on this when I read an article about Sir Jonathan Ive, the top designer at Apple. He and his team work in a compound on the Apple complex and are free to experiment, with no interference from chief executive Tim Cook – or even Steve Jobs before him – none of whom are allowed in without prior permission.

This makes me smile as I reflect on what would happen if I refused to let my CEO or any member of the board onto my office floor or to comply with the latest finance spreadsheet or HR request.

But perhaps there is some merit in this – when I was recruited it was on the basis that I showed some talent, in the same way a business that is acquired has demonstrated a value the acquiring brand wants.

So why is it that the first thing you do is force the new acquisition into operating in the same way as the prevailing organisation, that has somehow failed to generate the value of the combined parties before it arrived in the family?

Maybe one plus one does only equal two, after all.


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