Achieving Business Goals Through Strategic M&A

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In today’s competitive global market, organizations need to leverage every tool in their arsenal to stay ahead of the curve. One strategy that companies can use to achieve this is M&A.

With the right approach, M&A can drive significant growth, unlock fresh opportunities, and expedite the achievement of strategic business goals. In this article, Yoav Zeif, CEO at Stratasys, shares his experience in using M&A to drive positive business outcomes.

“Don't go for an M&A just because there is an opportunity. Go for an M&A only if it is part of your strategy and if it gets you closer to your North Star.” – Yoav Zeif

Listen to the episode below or click here to get the transcript and listen to your favorite player.

Competing in a broader market

When Yoav assumed his position as the CEO of Stratasys amidst the COVID-19 outbreak, he noticed that despite being an industry pioneer, Stratasys had faced a steady decline from 2014 to 2020 due to its limited focus on only two technologies. As a result, they were only addressing one-third of the overall opportunity in their market. This lack of technical diversity is a blind spot, preventing them from competing in growing markets.?

This led Yoav to revamp the company’s strategy, shifting it towards embracing Polymer 3D printing. And the fastest way to get there is by acquiring new technologies to ensure competitiveness, especially in markets they don’t exist in.?

Three-Layered M&A strategy

Stratasys uses a framework that guides the company's efforts to fill strategic gaps or accelerate specific initiatives, rather than acting opportunistically.?

1. Core Technologies: This involves leveraging their existing internal capabilities and acquiring additional needed technologies to compete in the market.?

2. Add-On Technologies: This involves investing in add-on features, software, and materials to strengthen their core technology while reinforcing the company's position.

3. Partnerships: Instead of acquiring or investing in all needed areas, Stratasys also seeks to establish partnerships that can assist in building the full workflow.

Through this structured approach, Stratasys aims to move from a prototyping industry to a manufacturing industry, focusing on polymers. The balance of these approaches allows the company to expand across different applications without misdirecting its focus or resources.?

With a dynamic five-year plan, the strategy evolves based on market changes, lessons learned, and feedback from customers and partners, reflecting annual reassessments and adjustments to stay aligned with the changing market and the company's progress.

Prioritization

A strong corporate development team plays a crucial role in implementing the M&A strategy. To ensure positive business outcomes when doing a transaction, it’s extremely crucial for Corp Dev to prioritize managing opportunities and potential and other related issues in the business strategy.?

According to Yoav, it’s essential to identify the make-or-break factors or those aspects that will significantly impact a deal's outcome. This rigorous prioritization helps to avoid spreading resources too thinly and losing sight of key objectives and ensures that efforts are directed towards areas that will most influence success.

Listen to the episode below or click here to get the transcript and listen to your favorite player.