MOST Analysis

Mission Statement

The purpose of this workshop is to map out the offerings that one wants to develop or enhance for the focus segments defined by WDP3. A target pool is at the intersection of Targeted Offerings and Focused Segments. For example, if your strategy is focused on growing a currently manufactured product beyond your existing markets, you’ll want to know all the players who make these products in the markets where you don’t currently play but aspire to. In this simple case, the target pool would be derived by researching the current suppliers in these focus segments and profiling them for certain things such as size, channels to market, etc. The approach of this workshop is to take the Targeted Offerings and in a way and ‘map’ them with the Segment Focus areas we developed previously. In reality you might only need to do one or few of these approaches, but the workshop can develop the understanding and skills to do this work, which is in essence synthesizing the ‘strategic play’ associated with any acquisitive growth program.

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Objectives

01. Strategic Intent: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month
02. Product-Based Targeting: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month
03. Service-Based Taregting: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month
04. Capabilities & Business Model Targeting: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month
05. Targeting Channels: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month
06. Branding Targets: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month
07. Targeting for Scope & Scale: departmental SWOT analysis; strategy research & development. 1 Month
08. Targeting for Talent: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month
09. Intangibles Effect on Targeting: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month
10. Prioritization among Target Pools: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month
11. Organizational Alignment & Support: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month
12. Project Management: departmental SWOT analysis; strategy research & development. Time Allocated: 1 Month

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Strategies

01. Strategic Intent: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
02. Product-Based Targeting: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
03. Service-Based Taregting: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
04. Capabilities & Business Model Targeting: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
05. Targeting Channels: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
06. Branding Targets: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
07. Targeting for Scope & Scale: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
08. Targeting for Talent: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
09. Intangibles Effect on Targeting: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
10. Prioritization among Target Pools: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
11. Organizational Alignment & Support: Each individual department head to undertake departmental SWOT analysis; strategy research & development.
12. Project Management: Each individual department head to undertake departmental SWOT analysis; strategy research & development.

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Tasks

01. Create a task on your calendar, to be completed within the next month, to analyze Strategic Intent.
02. Create a task on your calendar, to be completed within the next month, to analyze Product-Based Targeting.
03. Create a task on your calendar, to be completed within the next month, to analyze Service-Based Taregting.
04. Create a task on your calendar, to be completed within the next month, to analyze Capabilities & Business Model Targeting.
05. Create a task on your calendar, to be completed within the next month, to analyze Targeting Channels.
06. Create a task on your calendar, to be completed within the next month, to analyze Branding Targets.
07. Create a task on your calendar, to be completed within the next month, to analyze Targeting for Scope & Scale.
08. Create a task on your calendar, to be completed within the next month, to analyze Targeting for Talent.
09. Create a task on your calendar, to be completed within the next month, to analyze Intangibles Effect on Targeting.
10. Create a task on your calendar, to be completed within the next month, to analyze Prioritization among Target Pools.
11. Create a task on your calendar, to be completed within the next month, to analyze Organizational Alignment & Support.
12. Create a task on your calendar, to be completed within the next month, to analyze Project Management.

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Introduction

Welcome to the fifth workshop in the Acquisitive Growth program. In this dynamic and interactive session, we will delve into the critical phase of M&A where organizations research and identify potential acquisition targets that align with their growth objectives. The “Target Pool” stage sets the foundation for successful M&A transactions by ensuring strategic alignment, maximizing synergies, mitigating risks, and driving acquisitive growth.

During this workshop, we will explore the significance of the target pool stage and its pivotal role in shaping the trajectory of M&A deals. We will discuss the historical context of target pooling in M&A, highlighting its evolution and the lessons learned from real-life case studies. Understanding the historical perspective will provide valuable insights into the evolution of target pooling strategies and the challenges faced along the way.

Our focus will then shift to effective strategies for researching a target pool. We will examine best practices for identifying potential targets, conducting thorough due diligence, evaluating strategic fit, assessing synergies, and managing risks. Through practical examples and interactive discussions, you will gain practical knowledge and actionable techniques for enhancing your target pool research efforts.

Furthermore, we will explore the challenges associated with researching target pools in M&A. Understanding these challenges, such as data limitations, market uncertainties, competition, and integration complexities, will help you anticipate and overcome potential obstacles during the target pool stage.

Lastly, the workshop will provide you with a comprehensive understanding of the importance of aligning target pool research with the overall acquisitive growth strategy. We will discuss the benefits of strategic alignment, including increased focus, optimized resource allocation, enhanced post-acquisition integration, and long-term value creation.

By the end of this workshop, you will be equipped with the knowledge, tools, and strategies to conduct effective target pool research, mitigate risks, and maximize the success of your M&A endeavors. You will gain insights from industry experts, participate in engaging activities, and network with fellow professionals in the M&A field.

Let’s dive in and unlock the key to identifying, evaluating, and pursuing the right acquisition targets to drive your organization’s growth and success.

Source:
www.algnewsletter.com

What is Target Pooling?

In the context of mergers and acquisitions (M&A), a “target pool” refers to a group or set of potential target companies that an acquiring company identifies and evaluates for potential acquisition. The target pool represents a range of companies that align with the acquiring company’s strategic objectives and criteria for M&A.

The process of creating a target pool involves conducting market research, industry analysis, and assessing potential targets based on various factors such as financial performance, market position, growth prospects, synergies, cultural fit, and strategic alignment. The acquiring company may consider both internal and external factors to identify companies that could be suitable acquisition targets.

The target pool typically includes a list of potential acquisition candidates that undergo further evaluation and due diligence in subsequent stages of the M&A process. As the M&A process progresses, the acquiring company narrows down the target pool and conducts more detailed analysis to select the most suitable target for acquisition.

It’s important to note that the composition and size of the target pool can vary depending on the specific M&A strategy, industry dynamics, and the acquiring company’s objectives. The target pool serves as a starting point for identifying potential acquisition opportunities and helps guide the M&A team in their evaluation and decision-making processes.

The History

The historical context of target pooling in M&A dates back several decades, with the practice evolving and adapting over time. Here are some key milestones and developments in the historical context of target pooling:

Early M&A Activity

Mergers and acquisitions have been part of business activities for centuries, but it was during the late 19th and early 20th centuries that larger-scale corporate consolidations started to emerge. Companies sought to expand their market presence, gain economies of scale, and diversify their operations through strategic mergers and acquisitions.

1960s and 1970s

The 1960s and 1970s witnessed a surge in M&A activity, with the formation of conglomerates and aggressive acquisitions becoming prevalent. During this era, target pooling strategies were still in their early stages, and the focus was primarily on diversification and vertical integration. Companies aimed to expand their reach across various industries, leading to the creation of large conglomerates comprising diverse business lines.

1980s and 1990s

The 1980s and 1990s marked a transformative period for target pooling in M&A. This era witnessed a shift from conglomerate mergers to a more strategic approach to M&A, driven by the pursuit of synergies and shareholder value. Leveraged buyouts, hostile takeovers, and strategic alliances became prominent strategies, with a focus on financial performance and creating shareholder value.

Evolution of Due Diligence

The historical context of target pooling also saw the evolution of due diligence practices. As M&A transactions became more complex, the importance of conducting thorough due diligence increased. Due diligence processes expanded to include financial analysis, legal assessments, operational reviews, and strategic evaluations to identify risks, uncover hidden liabilities, and assess the viability of target companies.

Technological Advancements

The advent of technology and information systems significantly influenced the historical context of target pooling. With the proliferation of digital databases, advanced analytics tools, and improved access to market and industry data, companies gained greater capabilities for target identification, financial analysis, and risk assessment. Technology has streamlined the research process, enhanced due diligence efforts, and provided acquirers with richer data and insights.

Contemporary Trends

In recent years, the M&A landscape has been characterized by a focus on strategic alignment and value creation. Companies are increasingly prioritizing the integration of acquired entities and achieving synergies. The historical context of target pooling has led to a more refined approach, with acquirers conducting targeted research, leveraging advanced analytics, and aligning acquisitions with their core competencies and growth strategies.

Understanding the historical context of target pooling in M&A allows organizations to learn from past experiences, adapt to changing dynamics, and adopt best practices. It highlights the evolution of strategies, the impact of market trends, and the importance of comprehensive research and due diligence in driving successful M&A transactions.

What is the significance of this stage in M&A?

Source: www.dealroom.net

The stage of identifying a target pool in the M&A process holds significant importance for several reasons:

Strategic Alignment

The target identification stage allows the acquiring company to align its M&A strategy with its long-term strategic objectives. By defining the criteria and characteristics of potential targets, the acquiring company ensures that the identified targets align with its goals, whether it is expanding into new markets, gaining technological capabilities, diversifying product offerings, or achieving other strategic objectives.

Efficient Resource Allocation

The target identification stage helps the acquiring company allocate its resources effectively. By evaluating potential targets based on predetermined criteria, the acquiring company can focus its time, effort, and resources on opportunities that have the highest likelihood of meeting its strategic objectives. This avoids wasted resources on targets that do not align with the company’s goals.

Opportunity Assessment

The stage of target identification enables the acquiring company to assess various opportunities available in the market. By researching and analyzing potential targets, the acquiring company gains insights into industry trends, competitive dynamics, and growth prospects. This assessment helps the company identify attractive opportunities for value creation and competitive advantage through acquisition.

Risk Mitigation

Conducting a thorough evaluation of potential targets during this stage helps mitigate risks associated with M&A transactions. By conducting initial due diligence and evaluating factors such as financial performance, market position, and cultural fit, the acquiring company can identify and assess potential risks early on. This allows for informed decision-making and reduces the likelihood of costly surprises during later stages of the M&A process.

Deal Flow Management

The target identification stage contributes to deal flow management by establishing a systematic process for evaluating potential targets. It helps create a pipeline of opportunities that can be evaluated and progressed through subsequent stages of the M&A process. This organized approach allows the acquiring company to efficiently manage multiple potential deals simultaneously and make informed decisions about which opportunities to pursue further.

Overall, the significance of the target identification stage lies in aligning M&A strategy with strategic objectives, optimizing resource allocation, assessing opportunities and risks, and establishing a structured approach to manage the M&A deal flow. It sets the foundation for subsequent stages, such as due diligence, negotiations, and closing the deal.

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What are some effective strategies when researching a target pool

Source: www.blog.corporateleaderscommunications.com

When researching a target pool in the context of mergers and acquisitions (M&A), there are several effective strategies that can help you gather information and evaluate potential targets. Here are some key strategies for researching a target pool:

1. Define Criteria: Clearly define the criteria and parameters