When Yahoo's not in the news for firing its COO, it's in the news for making one acquisition or another. For example, last week Yahoo acquired a startup called Aviate for a reported $80 million.

It's the sort of news that Dennis Morgan, CFO of Acquia, is all too familiar with. Prior to his job at Acquia, he was the vice president of corporate finance at Yahoo, where he played a lead role in more than $5 billion in acquisitions and business development deals.

Between Yahoo and Acquia, Morgan was the CFO of four different venture-backed companies. He led one of them, Buddy Media, through a $745-million sale to Salesforce.com. 

The point is, Morgan knows a thing or two about the acquisitions process--and how it can go wrong. I recently interviewed him on the finer points of dealmaking--there's more to it than mere valuation.

When acquisitions go wrong, why do they go wrong?

The gap between the dream of what this acquisition is going to do for you, and what actually happens. And the reason this gap gets created is because of a lack of really detailed planning around how the acquisition is going to achieve the goals that you as a buyer have in mind for it.

How can acquirers and acquired companies close the gap?

You have to put an operating plan (OP) in place as early as possible. In the pre-acquisition phase, companies spend so much time on due diligence that they neglect putting an operating plan in place. You should have the OP done before the due diligence, so that during due diligence you're looking for the things that will prevent you from executing your OP.

Why doesn't this happen as a matter of course? 

Most deals are done looking for textbook risks, but not thinking about how you'll fold this [smaller] group into your organization--and whether the target numbers are constructed in a way that allows for that integration. Also, sometimes you don't have time to do it. You may be in a competitive situation where you have to put your numbers on the table.

What can acquirers do so they're prepared to move quickly, if need be?

Two things. The first is that good M&A is driven from a buyer's perspective by a strategic road map before any discussions ever start. What are you trying to do with the business you're targeting? You have to be out there very early, meeting the managers at the [acquisition target] who are going to help you execute on your potential joint goals. The second thing is that you have an executive in [the acquired] company who signs up to the numbers [that the deal is expected to produce]. I've seen a lot of acquisitions hit the brakes when a discussion goes from a theoretical M&A model to someone saying, "Well, this is my budget."

Where, on the operations level, do deals typically fail to meet the expected numbers? 

Often it's with the general managers of business units. Sometimes operators and GMs are in the back seat until the acquisition is done. Then suddenly it's their turn to drive. Their reaction is often, Wait a minute, I didn't realize I had to own these numbers.

We've talked a lot about the blind spots of the two companies involved in a deal. What blind spots do bankers and other intermediaries have? 

A banker is usually not thinking about your budget. He is thinking about long-term growth rates and margins, and not about, say, how benefit costs change and how recruiting models change. The other thing a banker can't appreciate is the important alignment at both cultural and leadership levels. I've seen acquisitions fail because the leadership team of the acquired company suddenly does not feel like they're in charge and doesn't feel like they're out to create great things in the world anymore. Now they're a wheel in the machine. 

Any final thoughts?

The last thing I would say is it's easy to get caught up in valuations. But you need a strong operating plan and cultural alignment to be successful. An acquisition won't fail because you paid 10 percent too much. But it will if you haven't nailed the cultural alignment or the operating plan.