The Perendie platform® is a way of increasing the objectivity of acquisition selection and the probability of realising an acquisition’s business plan
Start with the future
The Perendie platform® evaluates a potential acquisition’s business plan by drawing an integrated picture of its planned outcomes, activities and resources. It also identifies the causes of success, providing a more objective means of answering the following questions:
- Does the company have potential for sustained growth?
- Does management have the ability to exploit this potential and control the company through the growth phases?
- Does the possible reward justify the risk?
- Is this company a more or less attractive opportunity than others we are considering?
Commit everyone to their contribution to success
The platform also measurably defines what each set of stakeholders – investors, customers, employees and suppliers – will get out of the transaction and contribute to it. It enables and encourages them to align around the shared objective of a successful venture. The comparison of what could be with what is reveals opportunities to make quick and sustainable increases in productivity and profitability.
The consequences of using the platform
The platform delivers:
- Integration – everything the acquired organisation needs to do and employ to deliver its required outcomes, at all levels, is linked
- Predictability – the causes of success are identified, and the probability of the required outcomes being delivered is objectively predicted, mitigating risk
- Transparency – anyone internally and externally can see what the acquired organisation intends to employ, do and deliver, and the progress being made and expected
These deliverables enable the acquisition’s management team to
- stick to what they know
- encourage a common philosophy of shared business goals and quality standards
- communicate the objectives and results throughout their organisation
- concentrate their management information systems on what is critical to success
- build their team
- anticipate problems
- keep their investors, bankers and advisers fully informed
Increase the probability of success
The platform does not replace due diligence and financial analysis. However, the additional use of platform before a transaction would help with the identification of potential targets, more effectively coordinate the work of the other advisers, and increase the probability of the shareholders and other stakeholders deriving value from the transaction. In turn, this would increase trust in the company funding the transaction, enhance its reputation, and extend its business development capability.
Secure the benefits
Successive studies of mergers and acquisitions have found that the long-term value added by a deal is less than the value expected, in most cases. The problem usually occurs after the integration of organisational structures and the removal of duplicate functions. Separate cultures, attitudes, behaviours, processes, systems and data survive the structural integration. People remain uncertain about the future of the company and their own jobs. Consequently productivity declines and prevents the realisation of full value.
The Perendie platform® translates a post-merger vision into what needs to be produced, done and employed to realise the vision. Putting the platform in place before the merging starts gives everyone clarity about the end game and an opportunity to say how they could make it happen, even though some will not be required. It collects and connects every outcome, activity and resource required to achieve the organisation’s purpose, encouraging collaboration across organisational boundaries. It lets anyone contribute to the outcomes the organisation needs, increasing diversity and productivity. It identifies people who can’t contribute to the organisation’s future, saving money. It motivates people to cooperate by showing what everyone’s doing and what’s likely to happen. It challenges current deliverables, ways of working and resourcing, stimulating innovation and reducing cost. It measurably defines the required benefits of a merger and commits everyone from the combining organisations who can contribute to their realisation.