The two divisions within the company focus on different markets, and therefore, operate upon different revenue and business models.
On one hand, Isolde leads Siiquent, which targets hospitals and large diagnostic labs focused on gene-based diagnostics. With a razor-blade revenue model, it sells costly equipment at lower margins and makes substantial profits on consumables with a satisfying and loyal client base. On the other hand, Emanuel, who leads Teomik, targets research institutions such as universities and research labs. His unit focuses on selling high-margin equipment, with pricing flexibility that accommodates diverse customer demand.
As a mediator tasked with overseeing the merger, the focus should be on identifying a process that’s fair, productive, and ultimately realistic. While having a single revenue model provides a more coherent strategy planning and streamlined operation structure for the company’s management, forcing both units into the same model risks losing the flexibility tailored towards the demands of the existing customers.
The first step is to engage in open dialogue, with both project leaders and the CEO, figuring out the ultimate and ideal goals behind the merger. This could be streamlining operational cost, making financial forecasting and decision-making easier, or even facilitating company structural changes. While the CEO might have the most incentives in driving the process forward, it is important to understand the perspectives of both Isolde and Emanuel to ensure buy-in and minimize resistance. By understanding their motivations, concerns, and visions for their respective divisions, the merger process can be framed not as a zero-sum game, but as an opportunity for synergy.’
The second step is to identify common ground. For example, a JOINT SWOT analysis can enable both leaders to thoroughly delve into the strengths, weaknesses, opportunities, and threats of their divisions and their business models. The process ultimately should help all stakeholders to understand 1) where collaboration is possible and desirable; 2) where challenges remain.
The last step is to explore hybrid models where both divisions can maintain their flexibilities while standardizing and collectively solving problems in other aspects of their business. Instead of imposing a top-down decision, the goal should be to arrive at a consensus that leverages the strengths of both models—whether through a blended revenue structure or distinct models serving specific markets under a unified strategic umbrella.
