Knowledge Transfer in Mergers and Acquisitions: The Benefits, Challenges, and How to Ensure Success

When deals fail to deliver, the cause is rarely the purchase price; it is the silent leakage of critical know‑how as people, processes, and systems are disrupted and reconfigured. By treating knowledge transfer as a strategic discipline—not an administrative task—leaders protect the very capabilities, relationships, and insights they are paying to acquire.

A robust knowledge management approach gives organizations the structure, tools, and culture needed to capture essential expertise early, move it where it is needed, and embed it into the new operating model. 

Read on to learn how to design and execute a practical knowledge transfer plan that turns each merger or acquisition into a repeatable advantage rather than a one‑off gamble.

What Is Knowledge Transfer in Mergers and Acquisitions?

A knowledge transfer plan in mergers and acquisitions involves the systematic transfer of critical knowledge from one organization to another to ensure the combined entity can operate effectively. It will depend on the specific type of mergers and acquisitions (M&A) transaction, but in all cases, each business brings its unique collective knowledge to the table. Its purpose is to ensure that the strategic capabilities that motivated the deal, such as specialized expertise or unique routines, are preserved rather than lost in the transition.

In practice, knowledge transfer in M&A involves planned activities such as knowledge audits, joint integration teams, mentoring or shadowing arrangements, and harmonizing information systems and workflows. A 2020 study found that 37% of acquiring firms pursue M&A to gain knowledge or technology, and effective knowledge transfer in these deals enhances post‑acquisition performance in sales growth, profitability, and ROI. These efforts aim to reduce disruption, prevent knowledge loss from turnover, and translate previously separate knowledge bases into a coherent, shared operating model. 

Why Is Knowledge Transfer Important in M&A?

Knowledge transfer is important in mergers and acquisitions because much of the deal’s value resides in the acquired firm’s processes, technologies, customer relationships, and talent, not just in its physical or financial assets. If this knowledge is not captured and shared, the acquiring company risks losing the very capabilities it paid for through employee turnover, broken routines, and disrupted customer service. 

One acquisition study of 110 deals found that firms with high levels of knowledge transfer outperformed those with low levels by roughly 11–13% on post‑acquisition performance measures, underscoring how directly effective knowledge transfer influences M&A success. Robust knowledge transfer shortens integration timelines by helping teams quickly understand new systems, processes, and decision rights, improving coordination across legacy organizations. As employees gain access to combined best practices, the merged entity can drive innovation, streamline workflows, and identify new revenue or cost‑saving opportunities that neither company could achieve alone.

What Are the Core Pillars of a Knowledge Transfer Strategy?

When implementing a knowledge transfer plan, there are four core pillars that companies should understand to utilize knowledge transfer with mergers and acquisitions:

• People: People are the source, carriers, and recipients of organizational knowledge, so they must be given clear roles, time, and incentives to share what they know and learn from others. People‑focused practices like mentoring and structured handovers ensure that critical tacit knowledge does not walk out the door when individuals leave or change roles.
• Processes: Processes define the repeatable steps for identifying, capturing, documenting, and applying knowledge so that transfer is systematic rather than when it’s necessary. Well‑designed workflows, such as standardized templates, checklists, and review cycles, make knowledge transfer predictable, measurable, and easier to improve over time.
• Technology: Platforms and tools like knowledge bases, collaboration suites, and search store and deliver knowledge at the moment of need. When integrated into daily work, these systems reduce friction, prevent information silos, and make it easier for employees to find and reuse existing know‑how.
• Culture: Culture determines whether people actually choose to share and use knowledge by shaping norms around openness, learning, and psychological safety. A supportive culture recognizes and rewards knowledge‑sharing behaviors, treats questions as opportunities to learn, and discourages hoarding information as a source of power.

These pillars must work together to ensure that critical knowledge not only survives the deal but actively fuels the combined organization’s strategy, innovation, and integration goals. When people, processes, technology, and culture are aligned, knowledge transfer becomes a sustained capability that accelerates synergy realization, reduces integration risk, and preserves the very know‑how that justified the merger or acquisition in the first place.

5 Challenges With Knowledge Transfer in M&A

Knowledge transfer can create barriers to acquisitions and mergers, which is difficult because it depends on people willingly sharing what they know while navigating uncertainty, cultural clashes, and changing structures. The following five challenges can slow integration, erode the value of the deal, and cause critical know‑how to be lost just when it is most needed:

1. Cultural misalignment: Differences in values, norms, and ways of working undermine trust and discourage open knowledge sharing between legacy organizations.
2. Key talent loss: Departures of critical employees result in the loss of tacit knowledge about customers, systems, and decision rules that is hard to replace.
3. Systems incompatibility: Mismatched tools, data structures, and documentation standards make it difficult to locate, interpret, and integrate knowledge.
4. Unclear ownership: No defined roles or accountability for knowledge transfer activities leads to fragmented, ad hoc efforts that lack follow‑through.
5. Integration overload: Employees are so consumed with new roles, processes, and tools that they have little capacity to document and share what they know.

When these obstacles are not anticipated and actively managed, the merged entity risks losing the very capabilities and insights that justified the merger or acquisition.

Impacts of Poor Knowledge Transfer in M&A

Poor knowledge transfer in mergers and acquisitions can erode much of the strategic value that motivated the deal, especially when critical know‑how is tied to people, routines, and relationships. When knowledge does not flow, integration slows, risks increase, and the merged organization struggles to realize promised synergies.

1. Operational Disruption and Quality Issues

When processes, systems, and tacit know‑how are not properly transferred, day‑to‑day operations can experience delays, errors, and inconsistent service levels. Customers may encounter conflicting information, slower response times, or degraded product quality as teams learn through trial and error instead of using established practices. This aligns with evidence that ineffective post‑acquisition knowledge transfer contributes to the high rate of M&A underperformance, with up to 80% of deals failing to meet expectations.

2. Loss of Key Talent and Tacit Expertise

Poorly managed M&A often accelerates the exit of employees who hold deep institutional memory, customer relationships, and technical expertise. When these people leave without structured handovers, their tacit knowledge is lost, forcing the organization to rebuild capabilities at high cost and delay. This can stall product roadmaps, weaken client relationships, and reduce the value of acquired capabilities.

3. Inability to Realize Synergies and Deal Value

Synergies depend on combining complementary strengths, but poor knowledge transfer leaves these assets fragmented and underused. Teams continue working in silos and miss opportunities to standardize, automate, or cross‑sell. As a result, the merged entity may never achieve the cost savings, revenue growth, or innovation uplift that underpinned the business case.

4. Strategic Drift and Weakened Competitive Position

Without effective knowledge transfer, the acquiring company may fail to fully understand the acquired firm’s unique capabilities, positioning, and market nuances. This can lead to misaligned strategies and the erosion of competitive differentiators that once set the target apart. Over time, competitors that learn faster and integrate better can overtake the merged organization.

​When knowledge transfer is neglected in M&A, the risks extend beyond short‑term disruption to long‑term value destruction and strategic underperformance. Treating knowledge management as a core integration work stream, rather than an afterthought, is essential to protect the investment and build a stronger combined enterprise.

How to Successfully Transfer Knowledge in Mergers and Acquisitions

Successful knowledge transfer in mergers and acquisitions requires a structured, deliberate approach that starts early and continues well beyond deal close. The goal is to identify what knowledge matters most, capture it before it is lost, and embed it into the combined organization’s ways of working.

1. Identify critical knowledge and owners: Map the capabilities, processes, customer relationships, and technologies that are essential to the deal thesis, then determine who holds that knowledge in each organization. This prioritization ensures that knowledge transfer efforts focus on the “must‑have” domains that drive integration success and synergies.
2. Design a structured knowledge transfer plan: Define clear objectives, timelines, roles, and deliverables for knowledge transfer that align with the overall integration plan. This plan should also specify the methods and formats to be used for each critical knowledge area so activities are consistent and trackable.
3. Use multiple transfer mechanisms: Combine formal mechanisms like documentation, training sessions, and standard operating procedures with informal ones like peer mentoring and expert office hours. Using diverse mechanisms helps capture both explicit knowledge and tacit know‑how that people carry in experience and judgment.
4. Leverage enabling technology and central repositories: Create a single, searchable source of truth where integration‑critical documents, playbooks, and decisions are stored. Integrating collaboration and knowledge tools into daily workflows then makes it easy for employees to find and apply this knowledge while they work.
5. Embed knowledge into culture and governance: Ensure leadership clearly communicates that sharing and reusing knowledge is part of everyone’s role and recognizes teams that contribute valuable insights. Establishing feedback loops, such as lessons‑learned reviews and regular updates to documentation, keeps knowledge current and builds a culture of continuous learning in the combined organization.

Utilizing Knowledge Management for Successful Knowledge Transfer in M&A

Effective knowledge transfer in M&A gives organizations a practical way to preserve critical expertise, accelerate integration, and convert theoretical deal value into sustainable performance. When knowledge flows freely across legacy boundaries, the combined organization is better positioned to operate as one company in front of customers, regulators, and employees from day one.

By treating knowledge as a strategic asset, leaders turn knowledge management from an afterthought into a durable competitive advantage. Organizations that consistently learn from each transaction and systematically embed that learning into future deals will be the ones that capture outsized value from ongoing consolidation in their industries.

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This blog was published in February 2023 and was most recently updated and expanded in January 2026.

About the Author

Betsy Anderson

Betsy leads the customer success and implementation teams at Bloomfire and is a Certified Knowledge Manager (CKM) from KM Institute. Passionate about the people side of knowledge engagement and knowledge sharing, she brings real-world experience in tackling the challenges companies face with knowledge management.