I would like to analyze what the next step can be for M&A world. In this digital era, all these joint ventures, acquisitions will be reshaped I believe. Next Generation CEO should think how to utilize this habit/business method to increase the value of your company. As you know, M&A is a general term about the joint ventures. This term includes mergers, acquisitions and also consolidations, tender offers and purchase of assets. It always sounds like a big stuff especially big departments in holdings to deal with this investment type. However I believe this will change with the drive of digitalization. Somehow, we will see much quicker small moves to add value, not big mergers like in old times. It will be much to the point and more digital way. Legal world will change to support this as well. You will have just memory of understanding and move with small partnerships. The basic idea is to catch the speed of change and make even better process on that. So, what you need to do is less time consuming on decision making process and make small but variety of moves with lots of different stakeholders at certain time.
You can agree with a company to integrate only resources in some cases or only technologies in other cases. Main objective is how to create the synergy that enables you to get more competitive advantage. Only acquiring a company with 100% is not enough itself. One company cannot give you everything. So, in these cases, you better do sharing mentality with different strategy to be based on the most competent area of the firm. Having JVs with different shareholding structures/ratios and different managing board (being on the board or not) matter significantly.
Besides how this world is changing, the way of having agreement is changing as well. What I mean is the following. You can normally have a big agreement with another company and you can do that with cash or different options. I strongly recommend the stock sharing in new world and create your own currencies/methods to transfer the shares. In this way, you can earn in doubles. One way is to sell your stock and increase the value and other way is to create new currency of your company that can start making a new investment for both parties. This is only one example.
The point for Next Generation CEO is to think about new transactional methods and new types of consolidations with other companies. One other important point is absorbing companies. In traditional methods, one company buys other and merges everything then they become "one" again. I think that needs to change as well. Especially if there is innovation, technology, you do not need to touch the other company. Why do you buy a company? Let’s say, main reason is that you believe the technology of the company. Then why do you need to absorb that? Leave it aside and let them move even much more efficient and faster by giving them external support. That needs to be analyzed as well.
Creating new companies is another topic. We all love holding and we love to say I am CEO of this or that holding. I think it is again old school. You need lots of different anchors in everywhere. You are actually not a CEO anymore, you have to be white angel like an investor. You create different firms and give chance to growth fields you determined strategically. Give a try to different methods like risk sharing, shareholding partnerships, different legal entities, ways of investing startups, etc.
Wall Street is the only place that people ride to in a Rolls Royce and to get advice from those who take the subway as stated. As Next Generation CEO, you should always having a diverse team to assess not the cost of a potential company but more focusing on the worth.