Strategic Management: Formulation and Implementation

Strategic Approach To Acquisitions

The history of acquisitions shows that many have been unprofitable investments. According to a study by Michael E. Porter, of more than 2,6000 acquisitions made by thirty-three major U.S. companies from 1950-1986, more than half of these acquisitions were subsequently divested. What, then, can be done to make the acquisition process more effective?

According to H. William Ebeling and Thomas L. Doorley, the essential elements of an effective acquisition process are:

In general, acquisitions can be an effective way to improve the competitive position of a company and create value for both the stockholder and society at large. To do this, a company's acquisition process must: