(5 August 2020 – United States) Of more than 200 global CFOs polled by McKinsey, 39 percent said they played major roles in initial merger strategy, 42 percent reported their involvement in deal execution and 37 percent said they were involved in merger integrations.
In all three categories, the numbers had increased since 2019. Even more revealing, when the CFO was ‘very involved’ in merger integrations, companies were much more likely to capture cost and revenue synergies that were at or above plan.
Integrations are the single most important task a CFO must take charge of.
The numbers show that when the finance chief is directly involved in identifying potential synergies, transformation and value-creation opportunities, and cultural pitfalls, companies see greater deal success. To successfully integrate companies and cultures, business leaders must have an informed perspective on the synergies to be captured, the transformation opportunities to be pursued, the value to be created, and the cultural pitfalls to steer clear of. The CFO operates at the nexus of all these concerns and has both the information and the expertise to provide that perspective and help lead the way.
Whether and how the CFO chooses to do so can determine the success or failure of large integrations and corporate transformations. The key roles the CFO can play in ensuring that companies capture the most value from critical deals include becoming a synergy leader, transformation sponsor, communication leader and cultural role model.
“CFOs already play a leading role in the execution of mergers and acquisitions. Their hats are getting bigger, however, with an expanding focus on the end-to-end management and integration of such deals. The reward for taking on this added responsibility? Improved operating models and investor confidence, new capabilities, and value capture that goes beyond traditional synergies and veers toward meaningful transformation” stated McKinsey Partner Ankur Agrawal.
