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Merging police forces: lessons from companies: "Is it a good idea to merge police forces? There's a lot of lessons Charles Clarke could learn from company mergers. Here are six:1. Many mergers are disappointing. Folk wisdom used to be that most mergers fail. This great paper (pdf) by Robert Bruner shows that this is too pessimistic, but even he says: Most transactions are associated with results that are hardly consistent with optimistic expectations. Synergies, efficiencies and value-creating growth seem hard to obtain. 2. Mergers can be undertaken for bad motives - to flatter the CEO's ego or boost his pay. Richard Roll famously pointed out (pdf) that they can also be motivated by over-confidence; bosses over-estimate their ability to manage bigger companies and reap economies of scale.3. Cost savings are easier to achieve than revenue growth. Some of the biggest M&A failures - AOL-Time Warner is the standard example - came because CEOs saw them as a way to boost sales. A more likely way to succeed is just to cut out overheads or improve efficiency. This shouldn't be too hard. As the man says, '80% of my time is wasted.' This suggests police mergers are more likely to work if they concentrate on doing existing functions cheaper, rather than more functions better. It's worrying, then, that Clarke seems to think otherwise. 4. Watch for diseconomies"