Bill George, a senior fellow at Harvard Business School and former chairman and CEO of Medtronic, says it took him a while to embrace M&A as a strategy. Speaking during the M&A Fireside Chat at the inaugural Minnesota Smart Business Dealmakers Conference, George says for a long time, Medtronic hadn't done much dealmaking. But, recognizing that the company was weak in the interventional cardiology business, he met with the owner of Boston Scientific and decided to see if they could put something together. After 60 hours in hotel rooms talking about how they could put the two companies together, a deal was never consummated.

"I realized at a certain point that even though the deal financially was beautiful, strategically it was beautiful, it was never going to work," George says. "The cultures were not going to work. And I finally decided I had to walk away from it. It was going to be a disaster because it would have corrupted what Medtronic was. We would have lost our clarity of purpose, our clarity of mission, our clarity of values."

After walking away from that opportunity, he says Medtronic wound up doing $13 billion worth of deals in the next couple of years. Still, it’s the integration that make all the difference.

"I've watched investment bankers walk away from deals over 1 percent or 2 percent, and I found how you integrate is worth about plus or minus 50 percent," George says. "It can destroy a deal or it can make it work. You have to work out the so-called social relationships — who's going to do what? Is this an acquisition or are you trying to merge two companies?"

That social aspect extends to the entire organizational chart. He says deals work best when the people at the top get along. If they don't get along and there's a power struggle, it will not work.

"I find that when you get agreement on that and what is our combined strategy, what is our combined mission or vision, and what's our combined values? How are we going to operate? Who's going to do what? You have that worked out, then the numbers kind of fall into place," he says. "It's surprising, because you can justify the premium or whatever you're paying. So, I found deals can get blown up over the lack of that."

When considering an opportunity, he says it's important to give deals a close look to determine if there is a good fit and whether it really can be made to work.

"If you can't get that together, the egos will take it down. So, I think it's really important to work those things out."

He says once his company did a little deal, they then did five more because once it's discovered that it works, there's a greater inclination to do more.

"There's enough money out there that you can find ways to make the finances work if the deal really makes strategic sense and all the social issues of leadership issues are worked out," he says. "But, of course, I'm biased towards leadership. And if you don't have the right leadership, it's not going to work, period."