32. Why Mergers and Acquisitions Fail (Almost Every Time)

Season 8 Episode 16

In most companies, mergers and acquisitions (M&A) is treated like a finish line. But the truth is, signing the deal is just the start—and if you haven’t thought deeply about how two operating systems, cultures, and teams will actually work together, you’re already behind. The vast majority of M&A efforts fail to deliver long-term value, not because the deal was bad, but because the integration never really happened.

This week, Rodney and Sam unpack why M&A is so alluring, so broken, and so often misunderstood. From boardroom incentives and CEO ego to missing strategy and magical thinking, they dig into what really drives the endless appetite for acquisition—and why the actual design work of merging two organizations is almost always underfunded, under-led, or completely ignored.

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Mentioned references:

"reorg ep": AWWTR Ep. 31
"70-75% of M&A fails"
Ben Thompson and Stratechery
AOL/Time Warner merger
Microsoft/Nokia merger
"LARPing"
"OS work": The Ready's OS Canvas
"Midnight Zone and Twilight Zone": The Ready's Depthfinding
ecotones
"Microsoft innovation"
Rob Cross and Organizational Network Analysis (ONA)
McChrystal Group
mission-based team (MBT): FoHR Miniseries, Episode 1

00:00 Intro + Check-In: What is something you’ve done recently that seemed like a good idea but has since proven otherwise?

04:01 The Pattern: Companies acquire others for growth, merge goes bad, so have to acquire another

09:54 Big visible activities with very unclear ROI

14:09 Buying innovation because you can’t innovate internally

19:15 Destroying all the qualities that made the target company valuable

24:34 Mergers and acquisitions buy CEOs longer tenures

28:19 Our culture celebrates the big swings, not the steady transformation

30:35 Executive attention vanishes once the deal is signed, but that’s when the real work starts

38:43 Idea #1 - Let acquired company operate independently for as long as possible

41:35 Idea #2 - Use organizational network analysis to find and utilize your leverage points

44:14 Idea #3 - Spin up a real mission-based team around integration, or due diligence

46:18 Idea #4 - During due d

Published on 1 month, 2 weeks ago

Podcast Episode Details

32. Why Mergers and Acquisitions Fail (Almost Every Time)