What? Software company SAP has announced that in the wake of its purchase of Business Software and Sybase it is looking for further acquisition opportunities.
So What? "Innovate or go quietly into the night" to misquote Dylan Thomas. Tabletise your offering for starters.
Not getting left behind is what is driving M&A in the tech sector. But is it really just "buy or die"? You also need to be able to integrate to be successful. You may acquire a great product offering, but how do you integrate and develop if there is a cultural mismatch? When the acquisition fanfare stops, the integration hard yards start.
This is a pivotal time for supertankers SAP and Oracle. Many in the industry are questioning whether they and their kind will be able to keep pace with smaller, nimble young guns. In the face of such competition the big industry players will need to take steps or risk losing their market share. SAP and Oracle have taken divergent approaches to acquisitions, but converge on a fundamental understanding of the need to innovate to keep pace. Oracle sees strategic acquisitions as core to growing its business, (its website points to around 70 purchases since 2005) whereas SAP appears to have acquired fewer than half that number.
In a highly fickle market where demanding customers seek out the best, the brand loyalty towards most innovative products is only as good as what is being sold. Companies will need to focus on innovation as well as making and integrating strategic acquisitions if they are to survive in an increasingly tough environment.
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