De-mergers (M & A)

Introduction

De-merging or devestiture is based on the value of the parts being greater than the whole. It is thought that large enterprises often contain trapped economic value
"...because of the way they were put together through internal expansion of products and services, growth in new geographies, acquisitions, and mergers.."
John Kotter et al, 2021

The most valuable trapped economic value is around
"...human energy, human intellect, and the human capacity to take advantage of those big opportunities..."
John Kotter et al, 2021

This trapped capability is illustrated by
"...mishappen bureaucracy, out-of-date policies, historical culture, top-down-only approaches to change issues, and certain mindsets of people, all of which easily develops as firms grow and mature..."
John Kotter et al, 2021

De-merging is one way of  unlocking this value.

One advantage of this is that smaller units can be more competitive, flexible, nimble, agile, innovative, etc so that they are better able to handle the rapidly changing world around us.

More important than fostering a pleasant working environment the removal of stifling layers of management, offering financial incentives with the focus on
"...management processes to achieve reliable, consistent performance and on leadership behaviours and participation that is required to release innovation and effective change generally..."
John Kotter et al, 2021