Question

The Management of Technology and Innovation , 3rd Edition

Answer the following questions

1. Once due diligence is completed and the deal is consummated, than the technology-focused firm will either form an alliance or make the acquisition.

2. What are the key issues for evaluating the integration process? Define the following: metrics, gap analysis, financial fitness, strategic fitness, operational fitness and relationship fitness

Answer 1

Once due diligence is completed and the deal is consummated, than the technology-focused firm will either form an alliance or make the acquisition. Then, the integration process becomes important and critical for the success in order to get the technology and it is also evident that at this point most of the alliances fails.

It becomes important to evaluate the integration process but some of the issues occurs, such as, definition of the common objectives and clarity towards the success; clarity on integration plan and how it would evolve; metrics to be considered for the tracking purpose and right set of measures to be taken to find out the areas needing attention and improvements for the success; suitable governance model with criteria for decision making. Thus, all of these issues consists of written documentation. It becomes important for organizations to evaluate these on the timely basis and take appropriate actions as an when needed, by considering financial systems, compatibility of the business systems, core application involved in the business processes, operating environments which may be highly networked.

‘Metrics’ are the measures which an organization consider for the evaluation and control of the issues.

‘Gap Analysis’ is a method to find the difference among the expected business performance and the actual business performance , based on the set requirements and what steps to be taken to ensure that these two meet as expected.

‘Financial fitness’ is the difference among expected financial outcomes and actual financial outcomes.

‘Strategic fitness’ is the degree to which an organization is able to align its strategic goals with respect to its strategic results.

‘Operational fitness’ relates with the difference among the expected and actual operational performance.

‘Relationship fitness’ is the difference among the expected and actual association within the joint organization.