The WSJ today ran a short piece on a recent trend of large enterprise break-ups / divestments (gift link). For sure these acquire-and-divest cycles are cyclical, with bankers making book on either end, even as twitchy investors generally lose out.

Still, after advising numerous large enterprises in recent years, I couldn't help reflecting how difficult it is to find the ever-beloved "synergies" across two firms when it comes to Digital/MarTech.

Acquisitions often get justified by back-office cost savings. Yet as a greater proportion of enterprise spend migrates to digital channels, the ability to rationalize investments in those areas becomes more critical. And the reality is that if two firms have different audience bases and go-to-market models, you will likely not be able to combine digital platforms and ops without materially impacting performance at one of the parties.

Also, if the two teams and attendant systems reside at different maturity levels (perhaps even for good reason), you will probably not be able to align them.

Historically, executives have underestimated the challenges of combining two firms, even those in the same industry. Turns out digital rationalization is just as hard -- if not harder -- than back-end synergies.

Of course this doesn't mean you shouldn't try to rationalize. Nearly every RSG stack assessment uncovers savings of some kind. Just don't build an M&A business case around it...