Just like the world of online dating, many companies are now using social and digital media channels to dig up intelligence on its peers, competitors, and potential partners.
Starting any new relationship can be scary, and going in eyes wide open helps ensure there will be no surprises down the road. But check under the hood too long and you might put someone off. So how do you avoid some of the awkwardness of these “first date” encounters while still properly vetting a potential acquisition?
Striking that balance is what we’ll get into in this post.
Similar to the modern dating scene, companies are now relying on a variety of online and social media channels to “meet” and size up their prospect and target organizations. Whether you are assessing one or several acquisitive growth opportunities, today’s business leaders want to get to know the target company on a personal level – beyond the basics (financials, location, number of employees) – and get to know its employees’ personalities, the organization’s culture, its clients’ demands, the market perception – the list goes on and on.
As West Monroe Partners continues to assess acquisitions as part of its overall growth strategy, we’ve begun to use our internal team’s subject matter expertise to embark on a period of mutual discovery – a non-intrusive opportunity for both firms to meet and understand one another.
Not only do social media channels like Facebook, LinkedIn, YouTube, and Twitter provide a way to learn more about a person or business entity in a non-threatening way, but they also provide an unfiltered look into the potential partner. For example, on Twitter I can learn how ex-clients, existing partners, and even competitors feel about an organization – uncensored and most likely, in real-time. Think about it – if you have been the organizer or participant of a blind date in the past six years, the first thing you probably did was visit the person’s Facebook page to see what they look like and if they had similar interests. At West Monroe, we use these tools as a starting point to understand a target organization – i.e., how they communicate, the look and feel of their brand, which clients they have served, the make-up of the organization, etc. Just a few examples of past research resources include:
- Current and former employee reviews on Glassdoor
- Client feedback on Twitter
- Likes or followers on Facebook, LinkedIn and Twitter, as well as verbatim comments
- Photos and events shared on social media and their website
- Local news coverage and community involvement
All of these channels provide a window into the inner-workings of a firm, both from a client delivery and culture perspective. These insights, combined with more formal diligence processes, help create a complete picture, or “360 degree view,” of a company.
Although private equity volume is down, M&A experts anticipate an increase in activity across a variety of industries, including Healthcare, Banking, and Manufacturing, due to a changing competitive landscape, increasing customer demands, and new regulations. The consulting industry itself is undergoing an evolution as we continue to see an uptick in larger firms acquiring small and mid-market niche specialty shops, consolidating the market and creating competition for talent and resources. Because our product is our people, it is essential to maintain the integrity, quality and satisfaction of our people while continuing to provide exceptional client service.
For business consulting especially, merging similar entities is as serious as moving in with your significant other for the first time: you’re integrating with a new, unique set of individuals and talent. To be successful, you must ensure the merger does not negatively influence the integrity of your client relationships, your brand, and most importantly the culture in your four walls. Bringing on a new brand that does not complement your existing messaging can create negative equity, and even worse, confuse the market by offering differing and dissonant solutions. Trying to balance two individual cultures vs. creating one consistent group can lead to unexpected employee retention issues, a reduced ability to meet client needs, and ultimately a decrease in overall client satisfaction.
In the next two blog posts in this series, our team will highlight the key benefits to using social media to assess not only the brand equity and market penetration of an acquisition target, but also the firm’s structure and culture.