New business creation and acquisitions – the challenge for companies
petite may differ considerably from company to company. From the strategic perspective, it is vital to be flexible and consider the full range of future visions – not only the most desired. The risk of not doing anything is often neglected or underestimated, which may leave the company drifting and directionless. The possibility of failure should also to be taken into account when creating new business. Over the long term, companies that see strategic planning in terms of risk and are able to incorporate a risk-intelligent perspective into the planning process will be most adept at managing risks and achieving sustained success. The ManMAP research framework (figure 1) illustrates new business creation through M&A, taking account of risk management throughout the entire process. The framework concretises the way in which the new business creation is linked to the
The research interviews highlighted factors that promoted successful M&A. The creation of new business through M&A is a highly strategic issue. It requires a strategic vision, proactive procedures, and the ability to identify and evaluate new opportunities and to align them with the strategy. Companies must be able to foresee essential changes in their business environment, and in technological development. Systematic assessment of risks and opportunities must be performed in a controlled manner throughout the M&A process. Risks are part and parcel of operations in all companies. A particular challenge for management in creating new business lies in defining the acceptable level of risk – a decision must be based on the company’s risk tolerance. On the other hand, the degree of risk ap-
Opportunity an
d Risk Manag
Market foresight
Opportunity Management Need for strategy Regeneration
of New Business Creation
ement
Due Diligence Vision and Strategic M&A Decision
Technology foresight
Opportunity management
Integration of Operations and IP
Designing of Integration
Management of Business Continuity
n Making
Strategic Decisio
New business creation through M&A
Business continuity
Figure 1. ManMAP framework for creating new business through mergers and acquisitions.
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