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Cultural integration in cross-border mergers & acquisitions

Zhang, Rong (2010) Cultural integration in cross-border mergers & acquisitions.

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Abstract:Billions of dollars are involved in the execution of mergers and acquisitions between companies, especially when they take place between different cultures. In literature it can be found that a culture difference is a potential catalyst to the success or to the failure of a merger or acquisition. In this work these cultural differences are studied in more depth. In a literature review, different theories in this area are related and this will give insight into the following aspects: culture conflict; cooperation between two company top managers; misunderstanding and lower performances; polarization, negative evaluations of counter-parts, anxiety and ethnocentrism between members of the acquiring and acquired top management. The research consists of both a literature study and interviews with different companies. Results of the literature study show that cultural differences, especially of national nature, play an important role in the integration process. It appears that cultural differences not always have a negative impact, but they can also positively influence the integration process. From the interviews, it became clear that every relevant aspect of the integration process as found in literature is subjected to the influence of cultural differences. Also strategies are presented that can be applied to bridge the cultural differences and to turn the negative influence to their advantage. This can be accomplished by adopting tools to facilitate the cultural integration, leadership, cultural learning and information system. Moreover, in an era of globalization, this study contributes to company management practice by expanding across national boundaries through transformation into a new organizational culture. Keywords: culture, integration process, merger and acquisition, national culture, Hofstede 5 dimension, cultural integration, cultural learning
Item Type:Essay (Master)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration MSc (60644)
Link to this item:http://purl.utwente.nl/essays/60399
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