Acquiring a major supplier was part of PharmaCo's global strategy to grow its market dominance with an expanded product line, enhanced scale and stronger innovation abilities.
But PharmaCo knew the risks. Too often strategically sound deals fail to live up to expectations because of three major stumbles: missed targets, loss of key people and poor performance in the core business. PharmaCo faced an added merger complexity because this was a cross-border deal, which required addressing regional and cultural differences and geographically dispersed operations and employees.
To succeed, the CEO and senior leadership needed an integration plan that clearly defined the payoffs—and risks—and how to overcome them. Only then would the merged company be able to hit its performance targets.