Mergers & Acquisitions Can Be Risky Business Without Supply Chain Due Diligence

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New Tompkins International Paper Shows How to Lay Foundation for Successful M&A

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Anyone considering M&A needs to be aware of the opportunities to create value through supply chain improvement and integration.

Supply chain due diligence is vital when considering a merger or acquisition, according to Tompkins International’s new paper, Laying the Foundation for Successful M&A: A Supply Chain View.

“Far too often, M&A fails due to lack of synergy, related party conflicts, clashing cultures, or information technology issues,” says Jim Tompkins, CEO of Tompkins International and author of the paper. “I want to help business leaders avoid these types of mistakes altogether and provide a better understanding of how supply chains create value through M&A. A strong foundation cannot be built with just one piece of the M&A puzzle; you need to look at the full supply chain picture.”

Through supply chain due diligence, an organization can explore the performance of the target company’s supply chains to obtain valuable insights into M&A decisions. Tompkins presents a four-pronged approach to supply chain due diligence.

1.    Define supply chain baseline. Gain a high-level understanding of the supply chain to capture leadership’s view and document performance.
2.    Define relevant benchmarks. Establish present performance levels for targeted areas and compare them to relevant benchmarks to see where opportunities, challenges, constraints and risks exist, if the acquisition were to be made.
3.    Define supply chain opportunities and challenges. Perform a gap analysis and gap analysis assessment to reveal opportunities to grow revenue, as well as the risks associated with the M&A candidate’s supply chain.
4.    Define and document supply chain initiatives. Connect the opportunities and challenges with prioritized supply chain initiatives so that they can be addressed given that the merger or acquisition occurs.

Tompkins adds that tight timelines typical in the M&A process may mean that supply chains are not being fully considered in the overall impact of the deal. “This is not just about financial engineering,” he says. “Anyone considering M&A needs to be aware of the opportunities to create value through supply chain improvement and integration.”    

Read more about Laying the Foundation for Successful M&A: http://www.tompkinsinc.com/publications/monograph/successful-mergers-acquisitions/
About Tompkins International

Tompkins International transforms supply chains to help create value for all organizations. For more than 35 years, Tompkins has provided end-to-end solutions on a global scale, helping clients align business and supply chain strategies through operations planning, design and implementation. The company delivers leading-edge business and supply chain solutions by optimizing the Mega Processes of PLAN-BUY-MAKE-MOVE-STORE-SELL. Tompkins supports clients in achieving profitable growth in all areas of global supply chain and market growth strategy, organization, operations, process improvement, technology implementation, material handling integration, and benchmarking and best practices. Headquartered in Raleigh, NC, USA, Tompkins has offices throughout North America and in Europe and Asia. For more information, visit http://www.tompkinsinc.com.

CONTACT:
Myra Schwartz, 919-855-5533
mschwartz(at)tompkinsinc(dot)com

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Myra Schwartz
Tompkins International
919-855-5533
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