WEBVTT 00:00:01.543 --> 00:00:04.337 - M&A is an important part of our strategy, 00:00:04.337 --> 00:00:08.299 but I strongly believe that M&A cannot be the strategy. 00:00:09.676 --> 00:00:12.804 We bought TracFone, we bought it in four years ago, 00:00:12.804 --> 00:00:14.180 and the first three years 00:00:14.180 --> 00:00:15.974 of the integration went quite poorly. 00:00:15.974 --> 00:00:18.143 I think the reason it went poorly 00:00:18.143 --> 00:00:19.561 because M&A was the strategy. 00:00:21.062 --> 00:00:23.940 We were kind of, sort of clear why we did the transaction, 00:00:23.940 --> 00:00:27.402 but we weren't clear on how we integrate the assets, 00:00:27.402 --> 00:00:28.820 how we can continue to win, 00:00:28.820 --> 00:00:30.780 what investments are needed post that. 00:00:30.780 --> 00:00:32.323 But in the last 18 months, it's been one 00:00:32.323 --> 00:00:34.159 of the biggest turnarounds we've had. 00:00:34.159 --> 00:00:37.120 We went from losing market share 13 quarters in a row 00:00:37.120 --> 00:00:38.747 to actually gaining market share 00:00:38.747 --> 00:00:40.123 for the last three quarters, 00:00:40.123 --> 00:00:41.833 and we'll continue to see that trend over the next 00:00:41.833 --> 00:00:43.126 eight to ten quarters as well. 00:00:43.126 --> 00:00:45.295 Couple of things we got right towards the back half 00:00:45.295 --> 00:00:46.755 of TracFone acquisition. 00:00:46.755 --> 00:00:49.674 The first big one is be very clear 00:00:49.674 --> 00:00:51.217 why you're doing the acquisition. 00:00:51.217 --> 00:00:52.260 Second is fund it. 00:00:53.219 --> 00:00:55.472 We all get so excited by synergies, you have 00:00:55.472 --> 00:00:57.557 to take the synergies, but you've also got to fund the growth 00:00:57.557 --> 00:01:01.394 because there's, you know, there's no free lunch--you've got to fund growth. When you do an M&A, 00:01:01.394 --> 00:01:03.897 it's a combination of narrative and valuation. 00:01:03.897 --> 00:01:06.733 I think people spend too much time on the narrative 00:01:06.733 --> 00:01:09.569 and don't fully understand why did the acquisition, 00:01:09.569 --> 00:01:12.489 what are the core areas of value creation 00:01:12.489 --> 00:01:13.990 and then how you grind them out. 00:01:13.990 --> 00:01:15.116 But in large M&A 00:01:15.116 --> 00:01:17.744 transactions, I think the first thing is are you 00:01:17.744 --> 00:01:20.830 aligned on your belief system or your value system? 00:01:20.830 --> 00:01:23.166 And the answer nine out of ten times is no. 00:01:23.166 --> 00:01:25.376 Because companies have come in from very different places. 00:01:25.376 --> 00:01:27.462 Some may value customer centricity 00:01:27.462 --> 00:01:29.923 more. Some may value execution more. 00:01:29.923 --> 00:01:32.008 Some may value financial outcomes more. 00:01:32.008 --> 00:01:34.344 So step one is to align on what they are. 00:01:34.344 --> 00:01:36.679 It's not that complex. There are like five different vectors-- 00:01:36.679 --> 00:01:38.139 you have to align on them. 00:01:38.139 --> 00:01:41.101 The second is how do you execute culture? 00:01:41.101 --> 00:01:44.187 I think culture for me is the sum total 00:01:44.187 --> 00:01:48.191 of every single interaction you have as a company. 00:01:48.191 --> 00:01:51.986 The tone that the conversation we are having is culture for me. 00:01:51.986 --> 00:01:55.156 When I send an email to a customer 00:01:55.156 --> 00:01:58.034 because he had a bad experience, my culture is showing in 00:01:58.034 --> 00:02:01.663 that. I've had a 22-year relationship with BCG in different forms. 00:02:02.539 --> 00:02:04.332 There are two or three things that don't change 00:02:04.332 --> 00:02:06.000 and a couple of things that have changed. 00:02:06.000 --> 00:02:09.712 What doesn't change is relentless focus on client outcomes. 00:02:09.712 --> 00:02:11.381 It goes back to the fundamentals. 00:02:11.381 --> 00:02:14.050 Are you working on the problems I want you to work on? 00:02:14.050 --> 00:02:16.761 Are you driving the outcomes I want you to drive? 00:02:16.761 --> 00:02:18.304 And then more importantly, are you helping me 00:02:18.304 --> 00:02:19.681 build a better mousetrap? 00:02:19.681 --> 00:02:22.267 That's the three things I measure BCG on. 00:02:22.267 --> 00:02:23.852 I'm extremely happy and I look forward 00:02:23.852 --> 00:02:25.311 to another 22 more years with them.