Creating value beyond the deal

Organizational culture and aligning strategy key to successful deal

Toronto, June 13, 2019 --With economic uncertainty on the horizon, Canadian businesses are under greater pressure to find value when creating new deals. According to PwC Canada’s report Creating value beyond the dealOpens in a new window, approximately one third of Canadian dealmakers found that spotting the right deal can be challenging. Canadian companies should stay true to their strategic intent, develop a value creation blueprint, and put culture at the heart of the deal to develop a winning deal.

Deals are a key strategic lever to enhance the value of a business either to generate growth, enhance capabilities or reduce operational costs. Prior to moving towards a deal, dealmakers should understand how a potential deal aligns to their business strategy and focus on the right target that would add value to it. Identifying potential targets and engaging in pre-deal activities helps businesses find synergies and create the most value from their transaction.

“Deals are more likely to create value if they are tied to the company’s strategic vision and planning,” says Sean Rowe, Partner, Value Creation Leader. “You can no longer look at the value of a deal by the amount you paid. Value creation happens when a company works holistically through a deal which means it incorporates culture and people, revenue, and cost optimization.”

The report indicates that four out of five Canadian respondents (83%) admit that they should have made value creation a bigger priority. Creating a blueprint for conducting deals helps companies establish a thorough and effective process that drives the necessary diligence and rigour in terms of value creation and across all areas of the business.

Culture and people should be an integral part of deal planning and execution. Overlooking the existing organizational culture issues can be one of the biggest hurdles to an effective deal. “As part of the process, dealmakers should examine if there are cultural differences and how they will work together post-integration. Effective communications can have a positive impact on staff morale which could influence market reaction to the deal,” add Rowe.

Click hereOpens in a new window to access a full copy of the report.