Editing Synergy (section)

==Corporate synergy==
{{main|corporate synergy}}
[[Corporate synergy]] occurs when corporations interact congruently.  A corporate synergy refers to a financial benefit that a corporation expects to realize when it [[Mergers and acquisitions|merges with or acquires]] another corporation.  This type of synergy is a nearly ubiquitous feature of a corporate acquisition and is a negotiating point between the buyer and seller that impacts the final price both parties agree to. There are distinct types of corporate synergies, as follows.

===Marketing===
A [[marketing]] synergy refers to the use of [[Public service announcement|information campaign]]s, studies, and scientific discovery or experimentation for [[research and development]]. This promotes the sale of products for varied use or off-market sales as well as development of [[Marketing strategy|marketing tool]]s and in several cases exaggeration of effects. It is also often a meaningless [[buzzword]] used by corporate leaders.<ref>{{cite book |title=The Synergy Myth: And Other Ailments Of Business Today | vauthors = Geneen H, Bowers B |publisher=St. Martin's Press |year=1997 |isbn=978-0-312-14724-2 |page=xii |url=https://books.google.com/books?id=3nNwQgAACAAJ}}</ref><ref>{{cite book |title=Beyond Political Correctness: Social Transformation in the United States | vauthors = Cummings MS |publisher=Lynne Rienner Publishers |year=2001 |isbn=978-1-58826-006-2 |page=92 |url=https://books.google.com/books?id=7mgAwXas5xIC}} [https://books.google.com/books?id=7mgAwXas5xIC&pg=PA92 Extract of page 92]</ref>

===Revenue===
A [[revenue]] synergy refers to the opportunity of a combined corporate entity to generate more revenue than its two predecessor stand-alone companies would be able to generate. For example, if company A sells product X through its sales force, company B sells product Y, and company A decides to buy company B, then the new company could use each salesperson to sell products X and Y, thereby increasing the revenue that each salesperson generates for the company.

In [[Media Revenue Generation|media revenue]], synergy is the promotion and sale of a product throughout the various [[Subsidiary|subsidiaries]] of a [[media conglomerate]], e.g. films, soundtracks, or video games.

===Financial===
[[Finance|Financial]] synergy gained by the combined firm is a result of number of benefits which flow to the entity as a consequence of acquisition and merger. These benefits may be:

====Cash slack====
This is when a firm having a number of cash extensive projects acquires a firm which is cash-rich, thus enabling the new combined firm to enjoy the profits from investing the cash of one firm in the projects of the other.

====Debt capacity====
If two firms have no or little capacity to carry [[Corporate bond|debt]] before individually, it is possible for them to join and gain the capacity to carry the debt through decreased gearing (leverage).  This creates value for the firm, as debt is thought to be a cheaper source of finance.

====Tax benefits====
It is possible for one firm to have unused [[Tax deduction|tax benefit]]s which might be offset against the profits of another after combination, thus resulting in less tax being paid. However this greatly depends on the tax law of the country.

===Management===
Synergy in [[management]] and in relation to teamwork refers to the combined effort of individuals as participants of the team.<ref name="law2003">{{cite journal | vauthors = Lawford GR | title = Beyond success: Achieving synergy in teamwork. | journal = The Journal for Quality and Participation | date = October 2003 | volume = 26 | issue = 3 | pages = 23 | url = https://www.proquest.com/openview/2de291971139ca8c61040f197719fbbf/1?pq-origsite=gscholar&cbl=37083 }}</ref> The condition that exists when the organization's parts interact to produce a joint effect that is greater than the sum of the parts acting alone. Positive or negative synergies can exist. In these cases, positive synergy has positive effects such as improved efficiency in operations, greater exploitation of opportunities, and improved utilization of resources. Negative synergy on the other hand has negative effects such as: reduced efficiency of operations, decrease in quality, underutilization of resources and disequilibrium with the external environment.

===Cost===
A cost synergy refers to the opportunity of a combined corporate entity to reduce or eliminate expenses associated with running a business. Cost synergies are realized by eliminating positions that are viewed as duplicate within the merged entity.<ref>{{cite web | vauthors = Kenton W | veditors = Khartit K | date = 30 June 2021 | url = http://www.investopedia.com/terms/c/costsynergy.asp | title = Cost Synergy | work = Investopedia }}</ref> Examples include the headquarters office of one of the predecessor companies, certain executives, the human resources department, or other employees of the predecessor companies. This is related to the economic concept of [[Returns to scale|economies of scale]].