What Successful Acquisitions Understand Early
The day after an acquisition is usually filled with optimism. The deal is complete. The announcements have been made. New priorities are being discussed. Plans are already forming about how to improve the business and accelerate growth.
Private equity firms acquire companies because they see opportunity. They see ways to improve operations, create efficiencies, strengthen leadership, and ultimately increase value.
The challenge is that many firms begin changing the organization before they develop a deep understanding of how the company actually operates.
Understanding What Was Actually Purchased
As a founding member of an organization that was acquired, I had the opportunity to observe part of the diligence process firsthand.
One of the firms involved in evaluating the business was Deloitte & Touche. They wanted to determine whether the organization's knowledge, customer understanding, and value proposition lived primarily with the founders or whether it had become embedded throughout the company.
What they discovered was encouraging.
They interviewed frontline employees, managers, and members of the executive team. Regardless of who they spoke with, they heard remarkably consistent answers about the company's purpose, the value it delivered, and why customers chose to do business with us.
The organization wasn't dependent on a handful of leaders to explain its value.
The understanding existed throughout the company.
In other words, the organization was aligned.
The Rush To Improve
After an acquisition, there is often pressure to move quickly.
New reporting structures are introduced. Leadership teams begin evaluating people and processes. New initiatives are launched. Existing assumptions are challenged.
Some of those changes may ultimately be the right decisions.
The question is whether they are being made with a complete understanding of the organization.
Most private equity firms perform extensive financial, operational, legal, and commercial diligence before closing a transaction. Yet very few take the time to measure organizational alignment before making significant changes.
That can create a blind spot.
A company may appear healthy on paper while different departments operate with completely different interpretations of priorities, customers, or strategy. The opposite can also be true. A company may possess a high level of organizational alignment that leadership never takes the time to recognize before disrupting it.
People Want To Be Heard Before They're Directed
One reality of acquisitions is that employees often become uncertain about the future.
They wonder whether new leadership understands the business. They wonder whether the people making decisions understand the customers. They wonder whether anyone is interested in learning what made the company successful in the first place.
Most people are not resistant to change.
They are resistant to being ignored.
When leaders take the time to listen before directing, the conversation changes. Employees become more receptive. Trust develops more quickly. Valuable institutional knowledge surfaces.
Most importantly, leadership gains a clearer understanding of what is actually happening inside the organization.
The Missing Baseline
Imagine acquiring a company and having a clear picture of organizational alignment before making major decisions.
You would know whether employees shared a common understanding of the company's value proposition. You would know whether departments interpreted priorities consistently. You would know where Alignment Drift™ already existed and where it did not.
Instead of relying on assumptions, leadership would be working from data.
That visibility can help organizations make better decisions, reduce integration friction, and achieve a faster time to value.
Before You Change An Organization, Understand It
Every acquisition is built around a value creation thesis.
The faster leadership understands the organization it acquired, the faster it can execute that thesis.
Before introducing new priorities, understand existing priorities.
Before assuming alignment, measure alignment.
Before changing an organization, understand the organization.
Because once changes begin, it becomes much harder to know whether the challenges you're seeing were already there—or whether they were created during the transition.
Do You Know Your OAS™ Score?
Before assuming alignment, measure alignment.
The one metric your other metrics depend on.