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WORLDVIEW: Why corporate managers’ favourite “silver bullet” actually a dud
Confused managers are especially vulnerable to the “silver bullet” of restructuring. But that bullet is a dud. Be warned.
Investment bankers, stock market traders and egotistical executives love them. But for the most part, mergers and acquisitions are proven exercises in corporate destruction.
They hammer staff morale and cause havoc in personal and professional relationships. The financial rationale – "synergies" through cost cutting – rarely fulfils pre-deal expectations. So it is hardly a surprise that academic research shows 80% of mergers fail. Yet they continue to be justified, grounded in a misguided belief this time will be different.
Once in a while, however, mergers are genuinely part of a Grand Plan.
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