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The Importance of Building and Acquiring New Businesses: Leveraging an Integration Platform for Faster Growth and Higher Return
In today’s fast-paced business environment, companies that fail to innovate and grow are at risk of falling behind their competitors. One way to stay ahead of the curve is by building and acquiring new businesses. According to a recent survey by McKinsey, companies that prioritize business building as a strategic priority are more likely to grow quickly, even during times of economic volatility.
The benefits of building new businesses are clear. By creating new products, services, or businesses, companies can tap into new sources of revenue and gain market share. Furthermore, McKinsey’s research suggests that the enterprise value multiple of reported new business revenues is nearly twice that of core business revenues. This means that investors value new business ventures more highly than established core businesses, creating a potential for higher returns on investment.
However, building and acquiring new businesses is not always an easy process. It requires a significant investment of time, money, and resources. Furthermore, integrating new businesses into existing operations can be a complex and challenging task. Executives must do detailed estimations and projections to evaluate future revenues and compare them with integration costs.
To address these challenges, companies should have a ready infrastructure in the form of an integration platform. An integration platform can help speed up the process of integrating new businesses into existing operations, allowing companies to leverage earnings earlier and with less investment in future growth. Not only that – already existing API economy can help deliver new digital products even faster.
89% of companies have already adopted or are planning to adopt digital-first strategy and 60% of companies already have or are planning to launch a digital product in near future.
Keeping in mind the levels of digitization it’s clear that companies have to concentrate on accelerated digital product integration and delivery.
An integration platform allows companies to connect disparate systems, applications, and data sources across their entire organization. This creates a seamless flow of information and enables companies to more effectively manage their operations, including their new business ventures. By integrating new businesses into existing operations quickly and efficiently, companies can leverage the synergies between different parts of their organization and realize greater efficiencies and cost savings.
An integration platform can help companies to scale their operations more quickly and easily. By standardizing processes and data across their entire organization, companies can more easily replicate successful models and expand into new markets. API economy allows to quickly adopt already existing products into new business and gives good base for building new ones.
Building and acquiring new businesses is a critical component of long-term growth and success for companies. However, to fully realize the benefits of new business ventures, companies need to have a ready infrastructure in the form of an integration platform. An integration platform can help speed up the process of integrating new businesses into existing operations, allowing companies to leverage earnings earlier and with less investment in future growth. By investing in an integration platform, companies can position themselves for long-term growth and success in today’s fast-paced business environment.
Link to the survey: https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/new-business-building-in-2022-driving-growth-in-volatile-times