How companies lose the acquisition game?4 answersCompanies often lose the acquisition game due to various factors such as flawed valuation models, executive biases, and inadequate understanding of customer profitability. Research highlights that acquisitions can fail to deliver expected value, with three out of four acquisitions destroying wealth for the buyer's shareholders. Managers often rely on flawed valuation models or intuition, exposing their companies to costly pitfalls. Understanding customer profitability is crucial, as it varies significantly and can impact the success of acquisitions. Additionally, behavioral biases can lead to suboptimal acquisition decisions, especially in consolidating industries, where escalating takeover battles occur. To mitigate these risks, companies must carefully assess synergies, manage cultural differences, and plan meticulously to avoid detrimental outcomes in the hyper-competitive marketplace.
What is the strategic intent?5 answersStrategic intent refers to the fundamental drivers behind an organization's strategic thinking, aiming to achieve and sustain competitive advantages by setting clear directions and resource allocations. It involves a complex system of strategies, structures, and shared values that interact to guide the organization towards its goals. Different strategic intents, such as competitive advantage, rent maximization, or problem discovery, can impact creativity, value creation, and overall success in different ways. Strong strategic intent is crucial for companies, with the CEO playing a key role in establishing and communicating it to stakeholders, focusing on shared vision, resource allocation, and foresight. Misalignment between strategic intent and actions can hinder organizational success and the realization of strategic objectives.
When do acquirers earn abnormal returns?3 answersAcquirers earn abnormal returns when they transfer their own resources to the target. In contrast, when acquirers only receive resources from the target, they do not earn abnormal returns. Bank holding company acquirers experience negative average abnormal returns, while targets experience positive average abnormal returns on announcement. Acquirers of unlisted targets earn a significant average abnormal return, while acquirers of listed targets earn an insignificant average abnormal return. Acquirers experience large and long-lasting abnormal returns around the announcement of a failed bank acquisition when the deposit insurance fund is experiencing large outflows. Acquirers of state-owned assets earn positive abnormal returns, with greater returns for domestic acquirers, sales in developing nations, and acquirers that are not former state-owned enterprises.
Can You Say What Your Strategy Is?3 answersCrafting a clear and succinct strategy statement is crucial for a company's performance. However, there is a lack of consensus among academics on what strategy really is, leading to confusion and unease. The Economist even claimed that "Nobody really knows what strategy is". This confusion has resulted in the field being flooded with trendy slogans and terms. Despite this, the importance of a superior strategy for organizational success cannot be denied. Therefore, it is necessary to return to the fundamentals and establish a clear definition of strategy.
How can I think strategically?1 answersTo think strategically, individuals can incorporate specific experiences into their development plans, ensuring that these experiences have the required characteristics. They can also improve their strategic thinking ability by attending educational programs in nonhealthcare industries and maximizing the benefit received from them. Organizations can support strategic thinking by appraising gender differences in the experiences that contribute to strategic thinking ability and reviewing their strategic planning processes to encourage strategic thinking. Additionally, individuals can engage in informal learning, such as incidental and intentional learning, to develop their strategic thinking skills. They can also strengthen the five critical attributes for strategic thinking, including imagination, broad perspective, juggling multiple perspectives, desire to win, and adaptability. Engaging in the arts and developing critical reflective processes can further enhance strategic thinking ability.
What was the whatsapp market capitalization at the time of acquisition?4 answersWhatsApp is not mentioned in any of the provided abstracts. Therefore, there is no information available about the market capitalization of WhatsApp at the time of acquisition.