M&A Operations Overview

Running an effective M&A function requires more than just deal execution skills—it demands robust operational infrastructure including cadences, governance, reporting, and processes that enable consistent deal flow, disciplined decision-making, and value creation.

What is M&A Operations?

M&A Operations encompasses the systems, processes, and cadences that enable a Corporate Development team to:

• Source deals systematically and build pipeline
• Evaluate opportunities with consistent criteria
• Make decisions through structured approval gates
• Execute transactions with clear ownership and accountability
• Track performance against goals and metrics
• Report progress to leadership and board

Think of M&A Operations as the operating system for your corp dev function.

Why M&A Operations Matter

Common Failure Modes Without Strong Operations

• 🔴 Reactive vs. proactive sourcing - chasing inbound leads instead of targeted outreach
• 🔴 Inconsistent evaluation - deals approved based on who's championing vs. objective criteria
• 🔴 No pipeline visibility - leadership surprised by deal announcements or lack thereof
• 🔴 Resource thrash - team pulled in too many directions, nothing closes
• 🔴 Poor post-close tracking - synergies promised but not captured
• 🔴 Board frustration - irregular updates, lack of strategic narrative

What Good Operations Enable

• ✅ Predictable deal flow - consistent sourcing generates 10-20 qualified opportunities annually
• ✅ Disciplined decision-making - clear gates and criteria, data-driven choices
• ✅ Resource optimization - focus on highest-value opportunities
• ✅ Stakeholder confidence - regular reporting builds trust with CEO/board
• ✅ Value capture - rigorous tracking ensures promised returns are delivered
• ✅ Continuous improvement - metrics enable learning and optimization

M&A Operations Framework

The Five Pillars

┌─────────────────────────────────────────────────────────┐
│                    M&A OPERATIONS                        │
├─────────────────────────────────────────────────────────┤
│                                                          │
│  1. SOURCING CADENCE                                    │
│     • Outbound outreach rhythm                          │
│     • Pipeline management process                       │
│     • Target list development                           │
│                                                          │
│  2. MEETING CADENCE & GOVERNANCE                        │
│     • Weekly team meetings                              │
│     • Monthly pipeline reviews                          │
│     • Quarterly board updates                           │
│                                                          │
│  3. APPROVAL GATES & INVESTMENT PROCESS                 │
│     • Stage-gate framework                              │
│     • Investment Committee process                      │
│     • Decision criteria and thresholds                  │
│                                                          │
│  4. ROLES & RESPONSIBILITIES                            │
│     • RACI matrix for M&A activities                    │
│     • Functional partner engagement model               │
│     • Escalation paths                                  │
│                                                          │
│  5. REPORTING & METRICS                                 │
│     • Pipeline metrics and KPIs                         │
│     • Deal performance tracking                         │
│     • Board and executive reporting                     │
│                                                          │
└─────────────────────────────────────────────────────────┘

Pillar 1: Sourcing Cadence

Systematic Deal Sourcing

Sourcing Metrics to Track

• Targets contacted per quarter
• Response rate on outreach (target: 30-40%)
• Meetings booked per 100 contacts (target: 10-15)
• Inbound vs. outbound deal ratio
• Time from first contact to signed LOI

→ See Sourcing Cadence & Pipeline Management for detailed playbooks

Pillar 2: Meeting Cadence & Governance

Weekly Corp Dev Team Meeting (60 min)

• Pipeline review: status updates on active deals
• Upcoming milestones and deadlines
• Blockers and resource needs
• Market intelligence sharing

Monthly Pipeline Review with Leadership (90 min)

• Full pipeline walkthrough (all stages)
• Deep dive on 2-3 high-priority deals
• Resource allocation decisions
• Strategic priorities alignment

Quarterly Board Update (30 min)

• M&A strategy refresh
• Pipeline overview (high-level)
• Closed deals and performance
• Market trends and competitive intelligence

Investment Committee Meetings (ad hoc, 2-3 hours)

• Deal-specific approval requests
• Detailed financial and strategic review
• Q&A and decision

→ See Meeting Cadence & Governance for agendas and best practices

Pillar 3: Approval Gates & Investment Process

Stage-Gate Framework

Investment Committee Process

• Purpose: Approve major M&A decisions (LOI, binding offer, close)
• Composition: CEO, CFO, COO, Head of Corp Dev, Business Unit leaders
• Frequency: As needed (typically 1-2x per month)
• Decision Threshold: Typically deals >$50M or strategic importance

→ See Approval Gates & Investment Process for detailed gate requirements

Pillar 4: Roles & Responsibilities

Core M&A Team

Functional Partners (RACI)

→ See Roles & Responsibilities for detailed RACI matrices

Pillar 5: Reporting & Metrics

Pipeline Metrics Dashboard

Deal Performance Metrics (Post-Close)

→ See Reporting & Metrics for dashboard templates

Board Reporting

What to Report

1. M&A Strategy - How M&A supports corporate objectives
2. Pipeline Overview - High-level view of active opportunities (without confidential details)
3. Closed Deals - Recent transactions and integration progress
4. Deal Performance - Post-close tracking vs. underwriting
5. Market Intelligence - Competitive M&A, valuation trends, opportunities/threats

Reporting Frequency

• Quarterly: Standard board update (30 min)
• Ad hoc: Deal-specific approvals for transactions above threshold
• Annual: Strategic review of M&A priorities and retrospective

Format

• Executive summary (1 page)
• Pipeline snapshot (1 slide)
• Detailed deal updates (2-3 slides per active deal)
• Market intelligence (1-2 slides)
• Q&A

→ See Board Reporting for M&A for templates and best practices

Operating Rhythms by Team Size

Small Team (1-2 FTE)

Focus: Deal execution over process

• Sourcing: Ad hoc outreach, banker relationships
• Meetings: Weekly internal sync, monthly CFO/CEO update
• Gates: Simplified (Screen → LOI → Close)
• Reporting: Quarterly board update, deal-specific as needed
• Tools: Spreadsheet-based pipeline tracking

Mid-Sized Team (3-5 FTE)

Focus: Systematic sourcing, structured process

• Sourcing: Quarterly target list development, weekly outreach
• Meetings: Weekly team meeting, monthly pipeline review, quarterly board
• Gates: Full stage-gate with IC for deals >$50M
• Reporting: Monthly dashboard to leadership, quarterly to board
• Tools: CRM for pipeline, dedicated M&A platform (e.g., DealCloud)

Large Team (6+ FTE)

Focus: Specialized roles, high deal volume

• Sourcing: Dedicated sourcing team, sector specialists
• Meetings: Daily standups, weekly team, monthly leadership, quarterly board
• Gates: Rigorous stage-gate, formal IC for all deals >$25M
• Reporting: Weekly metrics, monthly leadership, quarterly board
• Tools: Full M&A tech stack (CRM, VDR, integration platform, analytics)

Building M&A Operations: Getting Started

Year 1: Foundation

Quarter 1: Define Strategy & Process

• Clarify M&A strategy and priorities
• Define approval gates and thresholds
• Establish IC composition and process
• Create initial target list (50-100 companies)

Quarter 2: Launch Sourcing

• Begin systematic outreach (10-20 per week)
• Build banker/advisor relationships
• Implement weekly pipeline tracking
• Hold first monthly pipeline review

Quarter 3: Formalize Reporting

• Create pipeline dashboard template
• Establish board reporting cadence
• Define key metrics to track
• Present first quarterly board update

Quarter 4: Optimize & Scale

• Review process effectiveness
• Adjust gates/criteria based on learnings
• Expand target list and sourcing
• Close first deal (if timeline aligns)

Year 2: Optimization

Goals

• Close 2-4 deals
• Achieve 10-20 active pipeline
• Reduce time-to-LOI by 25%
• Improve conversion rate to 7-10%
• Formalize post-close tracking

Year 3: Maturity

Goals

• Consistent deal flow (3-5 closes annually)
• Predictable returns (IRR within 200bps of plan)
• Strong board confidence in M&A program
• Best-in-class M&A operations benchmarked vs. peers

Common Operational Challenges

Challenge 1: Inconsistent Deal Flow

Symptoms

• Months with zero activity, then sudden rushes
• Leadership asking "what's in the pipeline?"
• Reactive to inbound only

Solutions

• Implement weekly sourcing cadence
• Build 12-month rolling target list
• Track leading indicators (outreach, meetings)
• Hold team accountable to activity metrics

Challenge 2: "Black Hole" Decision-Making

Symptoms

• Deals sit in diligence for months
• No clear approval criteria
• Decisions made in hallway conversations

Solutions

• Define explicit approval gates with SLAs
• Create deal review calendar (monthly IC meetings)
• Document decision criteria and thresholds
• Communicate timelines to counterparties

Challenge 3: Poor Resource Planning

Symptoms

• Team working on 10 deals simultaneously
• Nothing closes because everything is "in progress"
• Burnout and attrition

Solutions

• Limit work-in-progress (max 3-5 active deals)
• Prioritize pipeline ruthlessly (kill or accelerate)
• Bring in external resources (consultants, temp staff)
• Set clear expectations with leadership on capacity

Challenge 4: Lack of Post-Close Accountability

Symptoms

• Synergies promised, never tracked
• Integration plans created, never executed
• No one knows if deals created value

Solutions

• Assign integration owners pre-close
• Create synergy tracking dashboard
• Include post-close metrics in board reports
• Tie executive comp to synergy delivery

M&A Operations Maturity Model

Level 1: Ad Hoc (Reactive)

• No formal sourcing process
• Deals evaluated case-by-case with no consistent criteria
• Irregular reporting, if any
• No post-close tracking

Level 2: Basic (Repeatable)

• Some systematic sourcing (quarterly target lists)
• Informal approval process with CFO/CEO
• Quarterly board updates
• Pipeline tracked in spreadsheets
• Post-close tracking for recent deals

Level 3: Defined (Structured)

• Systematic sourcing with weekly cadence
• Formal stage-gate process and IC
• Monthly leadership reporting, quarterly board
• CRM or M&A platform for pipeline management
• Synergy tracking dashboard for all deals

Level 4: Managed (Optimized)

• Sector-specialized sourcing teams
• Data-driven decision-making with historical deal performance
• Real-time dashboard for leadership
• Integrated M&A tech stack
• Continuous improvement process (deal retrospectives)

Level 5: Optimizing (Best-in-Class)

• Predictive analytics for deal sourcing
• Automated reporting and workflow
• Proactive risk management
• Industry-leading conversion rates and returns
• M&A as competitive advantage

Most companies operate at Level 2-3. Moving to Level 4 requires dedicated investment in process, technology, and talent.

Key Takeaways

1. M&A Operations are the operating system for your corp dev function—without them, even great strategy fails
2. Five pillars: Sourcing Cadence, Meeting Cadence, Approval Gates, Roles & Responsibilities, Reporting & Metrics
3. Systematic sourcing beats reactive deal flow—weekly cadence generates predictable pipeline
4. Clear approval gates enable fast, disciplined decisions—avoid "black hole" diligence
5. Regular reporting builds stakeholder confidence—monthly to leadership, quarterly to board
6. Post-close tracking ensures accountability—synergies must be measured, not just promised
7. Right-size for your team - don't over-process with small team, don't under-invest with large team
8. Maturity is a journey - start with basics (Level 2), progressively add rigor over 2-3 years

Related Resources

• Sourcing Cadence & Pipeline Management - Systematic deal sourcing playbooks
• Meeting Cadence & Governance - Agendas and best practices for key meetings
• Approval Gates & Investment Process - Stage-gate framework and IC process
• Roles & Responsibilities - RACI matrices for M&A activities
• Reporting & Metrics - Dashboards, KPIs, and tracking
• Board Reporting - What and how to report to the board
• Corporate Development Team Structure - Organizing your corp dev function
• M&A Strategy Development - Aligning M&A with corporate strategy