Synergy Definition & Meaning

What is synergy

The idea is that the combined efforts of two or more entities are greater than those entities alone. In business terms, however, though companies may aim to achieve synergy by joining forces, the end result often lacks synergy, making the endeavor a wasted one. Synergy usually arises when two persons with different complementary skills cooperate. In business, cooperation of people with organizational and technical skills happens very often. In general, the most common reason why people cooperate is that it brings a synergy.

This positive synergy enables team members to be their full selves at work—with their unique life experiences, perspectives, talents, and communication styles. In fact, each individual’s unique perspective is exactly what enables a team to get their best work done. By leaning into each team member’s strengths—while also giving them opportunities to learn from one another—your team can achieve much more together than they would be able to do on their own. Like so many other business buzzwords, synergy has been used so frequently that it doesn’t always pack the punch it used to.

Set group norms intentionally

In order to achieve team synergy, you can’t just have a diverse team, you also need to empower collaboration and communication between team members in order to build something amazing together. When team members can be their full selves at work, they can unlock better collaboration and synergy. Workplace synergy is when employees work together to create a more productive working experience. This can include areas such as feedback, clearly defined goals, performance-based compensation, and overall teamwork to tackle problems that would be more impactful than if done alone.

  • Computers can process data much more quickly than humans, but lack the ability to respond meaningfully to arbitrary stimuli.
  • In order to achieve team synergy, you can’t just have a diverse team, you also need to empower collaboration and communication between team members in order to build something amazing together.
  • Articles in scientific and lay journals include many definitions of chemical or toxicological synergy, often vague or in conflict with each other.
  • Synergy usually arises when two persons with different complementary skills cooperate.

But every word has a purpose behind its creation—and synergy is no exception. In this article, we’ll dig into the true definition of synergy, and how to use this term—not as a buzzword—but as a driver for team growth and impact. Corporate synergy occurs when corporations interact congruently. A corporate synergy refers to a financial benefit that a corporation expects to realize when it 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.

Grammar Terms You Used to Know, But Forgot

In addition to knowing how to communicate effectively, team members also need to feel comfortable doing so. Make sure you’re making space for team members to bring their full selves to work by modeling team collaboration best practices. The more varied experiences, backgrounds, perspectives, and beliefs you have on your team, the more diverse your team is. Synergy can also be defined as the combination of human strengths and computer strengths, such as advanced chess.

In order for synergy to have an effect on the value, it must produce higher cash flows from existing assets, higher expected growth rates, longer growth periods, or lower cost of capital. From freemium to hyper local, these terms are used so often that they essentially lose all meaning. A quick Google search yields list upon list of “the top 100 worst business buzzwords”—and nearly all of the lists include synergy. Synergy is an interaction or cooperation giving rise to a whole that is greater than the simple sum of its parts. The term synergy comes from the Attic Greek word συνεργία synergia[1] from synergos, συνεργός, meaning “working together”. That’s where business initiatives like Diversity and Inclusion programs (D&I) come into play.

Related words

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. 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. The value of a diverse group comes from the differences of opinion and experiences that team members bring to the table—but team members need to feel comfortable expressing themselves in order to share those experiences. With effective workplace communication, team members can express themselves freely and accurately, and more effortlessly achieve synergy. Team synergy focuses on the “doing the work” part of diversity.

What is synergy

This could result if the merged firms experience problems caused by vastly different leadership styles and corporate cultures. Because of this principle, the potential synergy is examined during the M&A process. If two companies can merge to create greater efficiency or scale, the result is what is sometimes referred to as a synergy merge. For examples of how team leads set group norms, read our article on tips to create group norms for high-performance teams, with examples from 7 Asana managers. A more visual example of this synergy is a drummer using four separate rhythms to create one drum beat. Synergies may not necessarily have a monetary value but could reduce the costs of sales and increase profit margin or future growth.

How to use synergy in a sentence

During the registration of pesticides in the United States exhaustive tests are performed to discern health effects on humans at various exposure levels. A regulatory upper limit of presence in foods is then placed on this pesticide. As long as residues in the food stay below this regulatory level, health effects are deemed highly unlikely and the food is considered safe to consume.

Shareholders will benefit if a company’s post-merger share price increases due to the synergistic effect of the deal. The expected synergy achieved through the merger can be attributed to various factors, such as increased revenues, combined talent and technology, and cost reduction. Mergers and acquisitions (M&A) are made with the goal of improving the company’s financial performance for the shareholders. An old saying, “The whole is greater than the sum of its parts”, expresses the basic meaning of synergy.

Larger, merged businesses not only support one another, but they also achieve cost reductions that ultimately lead to higher profitability. For example, say person A alone is too short to reach an apple on a tree and person B is too short as well. Once person B sits on the shoulders of person A, they are tall enough to reach the apple. In this example, the product of their synergy would be one apple. If each is able to gather one million votes on their own, but together they were able to appeal to 2.5 million voters, their synergy would have produced 500,000 more votes than had they each worked independently. A song is also a good example of human synergy, taking more than one musical part and putting them together to create a song that has a much more dramatic effect than each of the parts when played individually.

Examples of synergy in a Sentence

Computers can process data much more quickly than humans, but lack the ability to respond meaningfully to arbitrary stimuli. If two firms have no or little capacity to carry 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. Pest synergy would occur in a biological host organism population, where, for example, the introduction of parasite A may cause 10% fatalities, and parasite B may also cause 10% loss. When both parasites are present, the losses would normally be expected to total less than 20%, yet, in some cases, losses are significantly greater. In such cases, it is said that the parasites in combination have a synergistic effect.