While construction companies have long been successful in growing through acquisition, merger or acquisition has greater risk in the design industry.
Mergers or acquisitions that succeed have qualities in common:
• clear strategic focus
• effort to modify company cultures
• balance between central decision making and local leadership
Strategic focus
It takes considerable work to make a merger succeed. To justify the effort, there needs to be a strong benefit directly related to a company’s overall strategic direction. Both parties should be able to state in simple terms why the resulting merger makes sense to their businesses and to their customers.
Cultural differences
Most design and construction companies reflect the personal characteristics of their leaders. Each organization has a distinct culture. It is common when two companies come together that the dominant firm imposes its culture on the other entity. This often results in defections and causes problems with clients over lost project history. We work with our clients to define the merged culture in advance and to institute this new culture throughout the new entity.
Desire for autonomy
Many professionals in architecture, engineering and construction are fiercely independent. They will consent to give up autonomy if this new interdependence benefits their office strategically, and if certain decisions are permitted at the local office level.
Matchmaker
Our work with firms considering merger or acquisition involves all these areas - the "why" and the "how" of merger, plus the "who" of merger. Our connections with firms and people in the design and construction field enable us to identify suitable merger candidates for our clients.
"Last year, our Phoenix landscape architecture firm successfully merged with a national firm. Andrea provided invaluable assistance and advice on all aspects of the transaction including valuation, due diligence and integration. Throughout the entire year long process, we relied on Andrea’s experience to help resolve potential sticking points in the negotiations, and her patience and objective viewpoint to keep the process on track to a successful merger. We truly do not believe we would have been able to complete the deal without Andrea’s sage advice."
Chris Brown
Vice President
JJR-Floor