synergy

syn·er·gy | \ ˈsi-nər-jē

plural synergies

Definition of synergy

1 : synergism broadly : combined action or operation

2 : a mutually advantageous conjunction or compatibility of distinct business participants or elements (such as resources or efforts)

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Did You Know?

An old saying, "The whole is greater than the sum of its parts", expresses the basic meaning of synergy. The word is sometimes used in a purely physical sense, especially when talking about drugs; sometimes a "cocktail" of drugs may be more effective than the sum of the effectiveness of each of the separate drugs. But the word is best known in the world of business. The notion that, when the right two companies merge, they'll produce a profitable synergy seemed exciting in the 1990s, when synergy became a trendy buzzword (even though it's actually been around since the 17th century). The idea of synergy was one factor in what became a "merger mania;" unfortunately, business synergy often turned out to be harder to achieve than to imagine.

Examples of synergy in a Sentence

A synergy has developed among the different groups working on this project. two companies that have found synergy

Recent Examples on the Web The partnership is also an example of corporate synergy, as FX is now owned by Disney, the company that has partial ownership of Hulu, and has already launched the Disney+ streaming service. — oregonlive, "What’s coming in 2020 TV? Streaming mania, more ‘Star Trek,’ tech terrors (this means you, Alexa)," 15 Jan. 2020 Getting everyone together before the event will greatly help in building the synergy between leaders. — Joel Paul, Quartz India, "There’s no easy way to layoff employees, but the damage can be minimised," 14 Jan. 2020 But not everyone shares similar circumstances or can boast of such synergy with investors for expansion plans. — Yomi Kazeem, Quartz Africa, "African startups are making the risky bet of expanding beyond the continent for growth and profits," 20 Dec. 2019 The regulatory hurdles delayed the realization of synergies that were initially factored into the value of the deal, MedMen said Tuesday. — BostonGlobe.com, "The weakness in pot stocks has scuttled MedMen Enterprises Inc.’s planned acquisition of PharmaCann LLC less than a month after it received antitrust approval.," 9 Oct. 2019 Steinberg also sees a synergy between the U.S. women's team's success and the MeToo movement, with their achievements on the soccer field, regardless of who wins Sunday's final, coming amid a time of heightened women's consciousness. — Anchorage Daily News, "The World Cup has been a smash. But women’s soccer still craves an elusive goal: lasting impact," 7 July 2019 Strategic buyers typically pay higher premiums, but, look for strong synergies for cost savings through the integration process post-closing. — Gary Miller, The Denver Post, "Gary Miller: A new year and a new life by selling your business in 2020," 22 Dec. 2019 Check out all the limited-edition Reebok cases and phone straps here, and finally experience the style synergy that comes from having your phone match your footwear. — Benjamin Levin, CNN Underscored, "Take 40% off all Reebok cases from Case-Mate," 18 Dec. 2019 The realignment makes things easier to manage, and creates more synergies across borders, which, Martínez-Valle says, inspires cooperation and idea sharing. — John Engen, Quartz at Work, "How a global chemical company gave itself a corporate purpose makeover," 16 Dec. 2019

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'synergy.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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Last Updated

18 Feb 2020

Cite this Entry

“Synergy.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/synergy. Accessed 20 Feb. 2020.

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More Definitions for synergy

synergy

noun

Financial Definition of synergy

What It Is

Synergy is the benefit that results when two or more agents work together to achieve something either one couldn't have achieved on its own. It's the concept of the whole being greater than the sum of its parts.

How It Works

Synergy is often one of the goals of a merger or acquisition. The two firms combined may be able to achieve higher profitability than either firm could achieve on its own. Synergy can be reflected in increased revenues and/or lower expenses.

For example, a company may acquire a similar firm, allowing it to expand its product offering and, as a result, increase its sales and revenues. This could not have been accomplished had the two firms remained independant.

In management, synergies may be created between management teams, resulting in increased capacity and workflow that was not possible when the teams were working independently.

As for costs, synergies allow for the creation of economies of scale. For example, a merger can reduce multiple levels of management and duplication and spread fixed cost technologies over larger operations.

Why It Matters

Synergies may be elusive, but they are one of the most important objectives in business. To acquire synergy will result in more efficiency, more efficacy and higher profitability.

Source: Investing Answers

synergy

noun