A lot of companies acquire others without much sensitivity regarding what theyâre really buying. They think theyâre getting physical assets or manufacturing assets or intellectual property (in some industries, thatâs more true than in others). In most cases, what theyâre really acquiring is people. In a creative business, thatâs where the value truly lies.
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You canât assume acquisition will mean acculturation. Thatâs why Apple doesnât really buy companies with large teams. They only acquire specific teams or technologies, usually very early in their life cycle when theyâre pre-revenue. That way they can easily be absorbed and Apple never has to worry about culture. They can also skip the inevitable duplication of functions between existing teams like finance, legal, and sales, or the painful process of integrating one large team into another. With the notable exception of the Beats acquisition, Apple has been laser focused on filling small, specialized technology gaps in their evolving products rather than acquiring whole new lines of business.
All acquisitions come down to what youâre trying to do when youâre buying a companyâdo you want to buy a team? Technology? Patents? Product? Customer base? Business (that is, revenue)? A brand? Some other strategic assets?
So, given that P&G needs retailers to stock Gain, the company needs to offer a compelling value proposition to retailers, or the end consumer will never see the product. Wherever there is an intermediary channel between the firm and the end consumer, that
intermediate customer and what it values must be understood.
Managing creative processes starts with the understanding that itâs not a scienceâeverything is subjective; there is often no right or wrong. The passion it takes to create something is powerful, and most creators are understandably sensitive when their vision or execution is questioned. I try to keep this in mind whenever I engage with someone on the creative side of our business. When I am asked to provide insights and offer critiques, Iâm exceedingly mindful of how much the creators have poured themselves into the project and how much is at stake for them.
But usually what theyâre really acquiring is people. In a creative business, thatâs where the value lies.
Anyone will tell you that software acquisitions are risky. The asset youâre acquiring is human. If the critical people decide to walk (and a lot of them would certainly have the financial wherewithal to do that once the deal closed), then youâve spent a lot of money for some buildings, office equipment, and access to a customer-installed base.