The documents are signed and the champagne is flowing. You’ve completed you first major acquisition. Now what?

Researchers say that as many as 80 percent of acquisitions fail as customers, management and momentum evaporate, along with planned cost savings and earnings growth.

While some of these failures are based on bad financial engineering or strategic decisions, usually the inability to integrate overlapping product lines, sales forces, and management into one cohesive organization creates the problems. Yet while tremendous effort is put into analyzing the strategic, tax, accounting, and legal issues surrounding most transactions, little thoughtful process and methodology is applied to ensuring the successful integration of acquired companies.

In this first article of a three part series, we examine five valuable principles that can help you beat the odds and successfully complete acquisitions:

•Begin integration planning before the deal is closed. Many companies treat acquisition integration as a separate and discrete phase of the deal, usually kicked off at the closing. Instead companies should think about integration as a process that begins at the time that due diligence commences and ends when operational and cultural melding is complete.

When you get the integration team involved early in the process, key financial assumptions can be verified against the operational realities, and you can avoid costly surprises. For example, it’s better to know that the network needs a massive upgrade before you close the deal.

Another area in which early integration planning can head off future problems is by defining and communicating what the acquirer views as non-negotiable elements of the integration and ongoing operations. Often, acquirers are afraid of being blunt about their expectations; but it’s better to get them out in the open, even if it imperils the deal, rather than to introduce mandatory operating principles after the deal closes and watch your key performers disappear.

Finally, incorporating some of the integration team into the due diligence process will often improve the results as the emphasis of due diligence will move away from completing a series of checklists towards forming a pragmatic view of the situation on the ground and an integration plan to support change.

In the next part of this series, we will discuss the how to form the integration team and keep them focused on the right activities.