"An Advice On The Feasibility Of A Merger Between The American Action Company And The German Multi Company"

7188 words - 29 pages

Diverse management styles and different types of both - natural andcompany culture lead to complicacies concerning the collaborationbetween human beings of distinctive cultural background in theireveryday work experience.EXECUTIVE SUMMARYWe were given the task to analyse the feasibility of a merger between the Action Company, which is an American enterprise and the German Multi Company. Both companies have their reasons for a merger. The financially strong Multi is seeking a partner that would provide them with innovation technology whereas the Action Company looks for financial support and organizational structure. So, at a first glance such a merger looks beneficial for both, but the opportunities and threats will be dealt with in detail so as to give a reasonable advice.The national culture models by Hofstede and Trompenaars do not reveal huge differences between those two national cultures. Especially in terms of power distance, similarity is high. This has an effect on the preferred communication andLeadership styles, they can be assessed quite comparable in Germany and the USA. Nevertheless there are some incongruities like the uncertainty avoidance. Germany scores extremely high in this area, while the score for the USA is rather low on this issue. According to this difference at least small problems can be expected, when people from these countries work together. But in conclusion one can say that from the analysis of national cultures, values and attitudes in general are similar and therefore a merger would be possible.Taking the microanalysis into account, many potential problems between company cultures become obvious. Firstly, the leadership styles differ completely. While hierarchy is very important at the Multi Company, participation is crucial at the Action Company. Secondly, the ways of communication are totally dissimilar. Meetings are considered important and effective at Action whereas the Germans absolutely dislike them and only use this kind of assemblies if not avoidable. Additionally the method of rewards and motivation differs as well. Multi Company rewards his employees for individual achievement and pays huge attention to personal status. On the contrary at the Action Company the job and its related tasks as well as achievements are rewarded. In consequence the occurring incongruency gives one example of the mismatch of both companies. Finally, comparing the values and beliefs again problems can be forecasted. Although both companies consider themselves as one big family, the factual approaches that are employed to ensure organizational commitment are somewhat different. Analysing Multi`s approach one can say that it is mainly based on organizational authority and hierarchy. Disobedience is not possible. At Action every single member of the organization has to understand all processes that are crucial to the company. Conflicts are not evil but necessary to develop beneficial solutions for the business and after a...

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