Tech companies that scooped up acquisitions during the days of easy financing are now hitting the brakes. As M&A deal activity in the sector sags, companies that were set on growth are now struggling to unlock value across recent investments—and they’ll need to act fast if they want to hit the topline figures listed in their investment theses.   But the hurdles to capitalizing on acquisitions are numerous, and fragmented tech stacks and poor product architecture can lock companies out of promising new markets—stymying their expansion of differentiated product lines.  The upshot? Without a clear post-acquisition platform consolidation and product strategy, tech companies may fail to realize the projected synergies those deals were meant to achieve.  We see these common pitfalls that tech companies encounter after acquiring smaller businesses—and offer benefits of using a product strategy framework to overcome them. 

Companies should actively engage and communicate with their newly acquired customer base—beginning on Day 1 of the post-sale integration—to gain a deeper understanding of their needs and expectations. It’s especially important as tech companies analyze and plan their approach to rationalizing their platforms, products, and operations post-acquisition.

Tech leaders often take a narrow, product-centric view as they migrate customers from their new acquisitions’ platforms. A common mistake is to focus on filling product gaps while underestimating other significant decisions—such as data migration and pricing/contract renegotiation, and the related churn risk—that must also be addressed before making migration and upgrade plans.

Instead, acquirers should pivot to a customer-centric view of migration. With a deeper understanding of the use cases, business drivers, and needs of their new customers, they can develop a realistic approach and timeline for their product planning and more accurately estimate the complexity and cost of migration.

Redesigning a company’s operating model is a challenge. It’s no surprise that as incoming leadership teams map out their transition plans, many fail to consider how operating model changes might impact the customer journey of migrating customers.

Tech companies should ensure that their customer-facing functions, processes, and tools provide a seamless, unified customer experience as part of the migration. Specifically, they should focus on key support areas such as sales, contracts, implementation and deployment, onboarding, and ongoing customer support. 

Businesses undergo rapid acquisitive growth for a variety of reasons—to amass new products and intellectual property, gain more customers and market share, or break into a new sector. Because of that, there is no one-size-fits-all approach to post-acquisition strategy and execution. 

We’ve seen holistic, customer-centric approaches to product strategy succeed where others fail. This framework considers the impact of consolidation on business operations and customer adoption, allowing leadership to adapt their acquisition strategy to best align to their needs.

Specifically, there are three pillars to address these needs, drive smart decision-making, and produce valuable outcomes based on overarching business goals: