BCA

By Mike Docherty, Venture 2

When it comes to acquiring innovation from the outside, make sure you don’t destroy the thing you’re acquiring.

Success in leveraging external innovation isn’t just about finding technologies, products and start-ups for new sources of growth. The hardest part, especially when its an acquisition of a company (versus product or technology), is often in successfully integrating the acquired start-up.

I wrote a post last year on Black and Decker’s acquisition of Vector Products for $160 million. Black and Decker has licensed its brand to Vector for several years, and the licensing to acquisition path actually looked like a smart move on Black and Decker’s part. It had afforded Black and Decker an opportunity to leverage one of its strengths (brand) into a new, but related category (emergency preparedness and inverters/chargers) and doing so with limited risk.

Well, it’s a small world in the South Florida business market, and we’ve gotten word that the company has laid off a significant number of employees (though it said it planned none when it announced the acquisition) as the business has under Black and Decker.  Laid off employees talk of an enterpreneurial company that struggled to retain that culture under the process-driven, disciplined approaches of Black and Decker. New products suffered, the speed of innovation slowed and large company ‘best practices’ turned out not to be the best thing after all.

In the next post, we’ll talk about some steps companies can take to ensure they don’t kill the very things they’re acquiring: innovations and the innovative cultures that create them.

Printed with permission of Venture2.com.