Is It Worth Integrating Portfolio Companies?

Deciding whether to integrate portfolio companies depends on several factors, as well as the overall scope of the integration effort. To begin with, cost take-out opportunities—such as shared procurement, centralized finance functions, and vendor consolidation—can deliver meaningful savings. However, be cautious when standardizing applications across the portfolio since perceived efficiencies can quickly disappear through added training needs, data inconsistencies, and lost productivity. Developing a strategy for portfolio company integration is not a decision to be taken lightly.

If you decide that standardizing certain applications is necessary, the most cost-effective approach is to build a small cross-functional team and run short, targeted sprints. This allows you to validate potential synergies and surface productivity risks early. For example, if your goal is to standardize inventory management systems, start by identifying the business most affected. Then, train a small pilot group on the new system. Next, select a limited product line to test so you can evaluate real-world benefits. By consistently measuring productivity impacts and training requirements, you can determine whether broader rollout is justified.

The bottom line: Integration can deliver significant value, but only when approached with discipline and respect for what makes each company unique. Ultimately, do not integrate simply because it appears attractive on paper—integrate because the benefits are proven, measurable, and aligned with strategic goals.

To understand how DealTech Advisors can assist you with this process, contact us. DealTech Advisors has extensive experience with guiding companies through the integration decision.