Abstract
In existing academic studies on the Due Diligence process, the different areas have been considered separately. This is time consuming and causes inefficiencies. The proposed approach to Due Diligence integrates these separate areas into one process. While every company’s success can be defined by a few key factors, these differ by industry. The goal of this analysis is to develop a basis for decision-making regarding Mergers and Acquisitions for small- and medium-sized manufacturing companies by generating a scorecard model that enables the potential acquirer to perform an overall analysis of the existing data as well as to generate an informed outlook for the future using a standardized and efficient approach that also has a positive impact on the success rate of mergers and acquisition transactions. The model is based on different research methods. First of all, a literature research was executed, to define the theoretical framework. There are two main areas, the Strategic Controlling on the one hand and M&A on the other hand. The theoretical findings are specified through expert interviews. The expert interviews are semi-standardized. There is a quantitative and a qualitative part. Based on the analysis, a concept for a leaner DD approach is developed. The article presents a sum up of the research. Doi: 10.28991/HIJ-2021-02-01-06 Full Text: PDF
Highlights
There are various approaches for company growth
The goal of the section was to precisely explore the challenges experienced by the experts in the Due Diligence (DD) process based on the concrete challenges that were found in the literature review
Another goal was to understand the options available for DD improvement as part of the Mergers and Acquisitions (M&A) process based on the opinions of the experts
Summary
There are various approaches for company growth. Organic growth based on the gain or recovery of market share are possibilities as well as the development of new markets and the acquisition of competitors or complementary companies. Market and company, the right approach needs to be chosen. Small and midsize enterprises (SME) all around the globe facing the challenge of not having a successor for the company. While big companies have easier access to resources to run an M&A process, for example with an own department, SME mostly do not have M&A know-how and resources available. Even big companies that seem to have the right resources, are not seldom in a state of economic problems after the takeover.
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