Build Versus Buy

The ACG National Capital’s Small Business Roundtable events typically draw an intimate group of a dozen or so senior executives for a moderator-led discussion of corporate best practices. During the past three years I have attended roundtables on marketing, sales compensation and employee retention.

Imagine my surprise this morning when I strolled into a packed Fairfax Room at the Tower Club in Tysons Corner, Virginia. One of the ACG represnetatives told me the event was so popular they actually had to cut off registration.

The topic for today’s discussion was certainly timely, “Build or Buy: M&A Best Practices.” The big draw though was the speaker – Brad Antle, President/CEO of IT and network solutions company SI International (Nasdaq: SINT).

Here are a couple of comments from the discussion I found interesting: (note: not all are attributable to Brad)

--Nearly 90 percent of acquisitions fail to achieve their objectives, primarily due to poor planning related to integration.

--When it comes to build versus buy, there’s no better return on investment than organic growth.

--According to Brad, SI’s goal is to maintain the speed and flexibility that defines a small business, while leveraging the financial and operational resources of a publicly traded company.

--Before pursuing an M&A strategy, it is critical to have a clear vision in mind of what you want your company to look like after the process. Establish clear benchmarks. And always focus on profitable growth, rather than merely amassing revenue.