Different Cultures vs Cross Border Merger and Acquisition

Introduction

Cross boundary line amalgamation and acquisition can convey great advantages but besides high hazard of failure. Research shows, that the failure rate is every bit high as 50 % ( Valant, 2008 ) . The chief ground for that are cultural differences ( Badrtalei and Bates, 2007 ) . One of the biggest amalgamation which has failed is the amalgamation between Daimler and Chrysler.

The purpose of this group assignment is to demo differences of the corporate civilization of Daimler-Benz and Chrysler every bit good as the chief intercultural communicating issues within DaimlerChrysler.

Finally some recommendation will be giving in order to minimise the mentioned issues. The civilization theoretical accounts by Geert Hofstede and Fons Trompenaars are used for a critical analysis in this work.

Recommendations and Decision

Organizational civilization is a cardinal factor for concern success of companies. Our definition of organizational civilization is an understanding for members of an organisation and their beliefs which influence perceptual experiences, ideas, action and feelings of the members of the organisation and manifest in their actions and artifacts.

Get quality help now

Bella Hamilton

Verified writer

Proficient in: Civilization

5 (234)

“ Very organized ,I enjoyed and Loved every bit of our professional interaction ”

+84 relevant experts are online

Hire writer

In amalgamations and acquisitions, companies have two different organizational civilizations which have to guarantee success. This integrating procedure is non without jobs, particularly when it comes to international amalgamations with different national civilizations. Insufficient attending of cultural differences might take to resistance and struggles. This causes important extra costs and in utmost instances it leads even to failure. This is shown in the illustration of the failed coup d'etat of Chrysler by Daimler-Benz.

In order to avoid a failure, Daimler-Benz and Chrysler should hold focused on organizational civilization already in the preparatory stage.

A bicultural audit may supply in this early stage a cultural analysis of both administrations based on information from the cyberspace, statements from clients or former employees of initial findings on possible hazard factors. More dependable information may be obtained merely after the proclamation of the trade through interviews with directors and staff, through interviews and focal point groups. Then they could hold worked out the footing of pre-defined dimensions, such as client orientation, direction manner and communicating behavior, the similarities and differences in the parties.

The determination on the deepness of integrating mostly determined the signifier of cultural fusion. The options are summarised as follows: ( O'Reilley, C. 2001 )

1. Adoption of a civilization ( normally the purchaser 's civilization )
2. Symbiosis of civilizations ( `` Best of Both '' )
3. Cultural pluralism ( both civilizations remain side by side )

Crucial for success is creative activity of lucidity how rapidly the mark civilization of the freshly created company looks like - what norms, values and rules to utilize and how to implement those into the day-to-day work.

Figure 1 provides information about the action which should hold been taken into consideration by Daimler-Benz during the readying phase towards cultural tantrum and during the integrating phase towards a common mark civilization.

During the integrating phase there are a twosome of points indispensable for successful cultural integrating: ( O'Reilley, C. 2001 )

• Communication and information
• Personal contact and cooperation of employees of both companies
• Supporting activities, part in the long term and guaranting sustainability

The deficiency of information and communicating are rapidly replaced by rumors and stir up uncertainness and fright. The direction must confront presence in the workers and explicate their scheme and the aims of the freshly formed administration. Staff meetings, information bases in forepart of the canteen or breakfast meetings are a utile tool. Furthermore, communicating activities are targeted to make credence of the new state of affairs among the employees. Communication is an of import lever to develop the preparedness for alteration in way of the mark civilization and to accomplish designation with the new administration. This requires that the benefits of this procedure of alteration are made clear for each person. Therefore the significance, advantages and aims of the dealing should hold been communicated clearly.

In add-on, a good communicating and personal contacts between employees, exchange visits to sites, the mix of squads, squad development, integrating and direction preparation workshops are of import and supportive tools on the manner to a common civilization.

Finally, integrating workshops are suited as launch events for the cultural integrating. The employees, the new corporate scheme every bit good as the values and rules of the new organizational civilization can be introduced and explained. This integrating workshop should give room for treatment to enable an geographic expedition of the content and besides the debut of team-specific issues. Strategy and values must non go on to open inquiries of direction, but should be brought in the influence country of each employee. This procedure takes clip and it is non done with a individual workshop. To advance the development of the new civilization and to guarantee sustainability DaimlerChrysler should hold been triggered the full procedure.