Synergy tracking
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From your experience, for which time period after closing of a deal are the synergies tracked?
I think more than it being time or duration determined it should also be about achieving the goals first set out. Given the dynamic environment continues to change each new day, the synergistic value could be diminished, accelerated or even negated. Considering the current tariff wars happening as an example, it pushes for a revisit of synergies in a new operating world given what may seem as value created could be wiped out overnight by factors that acquirers cannot control but need to manage.
in many instances I have seen synergy implementation tracking is something that is not being done on a liner basis, but rather 1-2 month into the post-deal period
Post-Day 1, I’ve seen synergies tracked and reported to the Steering Committee on a monthly basis (quarterly to the Board). This reporting frequency typically goes on for ~12 months after Day 1. Then, depending on the acquisition model and management approach, synergy KPIs might be reported for another year or so to measure financial synergy attainment of the deal (although less frequently).
I see it happening for up to 24 months post close. Key challenge is to be able to track synergies in capability-deals, given the entire company is normally fully integrated into a product suite.
Typically we started synergy tracking at the time of the close as we were actively trying to combine financials and get to the synergy target. This was typically a function of the IMO to track along with project status. Once a month they would go over the synergy targets, where we were and how far to go and if anything had changed during one of the full IMO meetings. The synergy tracking and dis-synergy tracking was usually completed by a member of our 6Sigma team.
I agree to Phil, we are usually tracking the synergies during the first 12 months. Nevertheless, we also need to differntiate between the synergies (as some can already be realized during the first 1-3 months and some cross-selling activities need to wait for approval and can only start 6-8 months after closing).
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