Merging Organizational Culture

Mergers and acquisitions have a unique potential to transform firms, and to contribute to corporate renewal (Angwin, 2001). They can help a firm renew its market position at a speed not achievable through internal development (Haspeslagh and Jemison, 1991; Harrison, 2002). Attempting to merge two organizations with distinct values and beliefs could result in a cultural collision that threatens the success

of an otherwise strategically compatible merger. Throughout a merger or acquisition, people in an acquired company often complain that they don’t know what is happening, express fear about losing their jobs, and feel demoralized as to the future of their contributions.

Mergers and acquisitions immediately impact organizations with changes in ownership, in ideology, and eventually, in practice. Of the three root strategic assets noted above, cultural cohesion is most often the critical asset in the eventual success or failure of the overall deal and the one that impacts the extent to which qualitative talent retention can be attained.

Despite the fact that it is increasingly common these days for companies to publish their cultural traits or values, what is listed does not always reflect the actual culture of the place. Anthropologists have long known that the task of learning about a specific grou

p’s culture does not start by asking members themselves to identify the specific traits. In fact, cultural traits are not readily identified by the members of a social group. Understanding the depth of cultural influences that are practiced over time within a specific group or organization requires long periods of reflective observation and the formation of key questions about beliefs, disciplines and innovative problem solving strategies.

Challenges:

1. Create a positive atmosphere: The impact of cultural differences in international mergers and acquisitions can be minimized when the buyer firms take the time to create a positive atmosphere for capability transfer before initiating any actual consolidation of human and physical assets. The creation of an integration team who studied the

2. Strategic interdependence and Organizational autonomy: The need of strategic interdependence and the need of organizational autonomy vary between the uniqueness of each acquisition process. New ideas are going to be implemented and old ideas challenged, a new organizational culture is going to be gradually emerging which will reflect in performance and profitability of the new firm.

3. Cooperation: Appropriate integration strategies implementation can facilitate the learning and acculturation process resulting in minimizing the uncertainties at work place and increasing the willingness to cooperate and to be part of a new culture entity.

Opportunities:

1. Acquisition of new competencies and knowledge: This is an important motive behind the firm’s cooperation and can be an important and desirable by-product of their collaboration. Always when there are firms willing to merge, one of the main reasons is the opportunity they have to acquire new knowledge and the development of new strategies in order to become much more competitive in the international markets.

2. Developing new Competitive Advantage: If learning is an important source of competitive advantage, then firms who accumulate skills and knowledge appropriate to their environment will outperform and will do better than those firms who don’t.

References:

• Alzira Salama, Wayne Holland, Gerald Vinten, (2003) "Challenges and Opportunities in Mergers and Acquisitions: Three International Case Studies – Deutsche Bank-Bankers Trust; British Petroleum-Amoco; Ford-Volvo", Journal of European Industrial Training, Vol. 27 Iss: 6, pp.313 – 321.
• http://www.kfunigraz.ac.at/iimwww/iimwww/orgculture.pdf
• http://gbr.pepperdine.edu/041/mergers.html
• http://1-focus.com/sustainingchange/merger-excellence
• http://impeccabile.net/a_o_p_pages/merg_acqui.html

Management Styles + Leadership Styles

Convergence vs. Differentiation

All the management and leadership styles have some things in common and the emerging ones will have them to, not only because the objective of management is the same no matter the culture, the organization or the country and also because some of the base their statements on other management or leadership styles and adding some different characteristics or different aspects. Most of the times those different aspects are given by the national culture because even if two or more cultures use the same management styles, they will never be the same.

All this I said before, is explained very clearly by the “Convergence vs. Differentiation” theory.

Convergence is the phenomenon that describes how things converge or can be very similar but never becoming just one, while differentiation is those factors that make differentiable one thing from another.

The convergence between two things, in this case management and leadership styles used by different countries depend on different kind of forces. Some of those forces are more powerful than others and make the management and leadership styles converge or not. A good example of one force that makes the managements style converge could be how similar those countries are, how close they are to each other and how similar are the cultures.

As countries develop, the management styles of those countries will converge to a model found and used by a more developed country.

A good example of a differentiation force across borders between two countries management and leadership styles of two countries could be a wider set or cultural norms in each society.

Isomorphism

Isomorphism is the capacity that an organization has to adapt to any environment or situation. They must develop a good adaptation process in order to be successful. This is a really important matter when we talk about companies going abroad, facing different cultures.

Any organization must have in mind that in order to internationalize they should change at least some aspects of the management style if the culture require it. It is not the same thing to run a business in Europe or in Latin America. It is not even the same to run a business in Mexico and in Guatemala.

For sure there may be some similar aspects that an organization can take advantage of, but if there are a lot of differences between the cultures, it is a must for every company to investigate and make some research, even hire expert people in that field to understand that culture, their styles and their behavior.

Communication + Vitual Teams

Communication is the flow of information from one place to another. A sender gives the message to the receiver, who decodes it and finally gets the information. Communication is the key and the main way that individuals have to socialize to each other. In order to communication be successful there must be shared or common meanings between the person who are communicating. There are two dimensions that influence communication process: the interpersonal communication and the technological communication.

The interpersonal communication is the base of building and maintaining relationships between individuals, it can’t be replaced with technology and in the interpersonal communication always participate four elements that are: The communicator or sender, who sends the message with coded information; the receiver, who receives the information and is in charge of decoding it and understanding the message; the perceptual screens that depend on each individuals perceptions and the message, or the information that is flowing between the sender and receiver.

When we talk about communication there is also a very interesting topic called and related to “reflective listening”. The reflective listening could be part of any communication process but it has some aspects, characteristics and well-defined objectives that make the communication process much more complicated.

In few words, reflective listening is to listen carefully to another person, repeating back the heard message and finally correct any inaccuracies or misunderstandings within the message. All this in order to reduce the perceptual distortion that any individual could have, to ensure the meaning of the message, clarify the message to be sure that the information received is right and consider emotions as key part of the message.

Communication not only depends on the process itself. It also depends on the communicators and their effectiveness to communicate. There are five types of communicators or speakers, and they are:

The expressive speakers, who openly express thoughts, opinions, ideas and feelings and most of the time is an extraverted person.

The empathetic listeners, who are always willing to listen, they are patient and responsive, and they are concern about others without taking responsibility for their actions or problems.

The persuasive leaders, who always encourages others to achieve the results instead of giving orders to them.

The Informative managers, who keeps employees well informed but avoids overloading them with a lot of information.

And finally the Sensitive to feelings, who is capable of adopting a critical perspective and provide negative feedback, confidentially and in a constructive manner and always is working to enhance employee self-esteem.

Virtual Teams

Team work has always been very important to all the organizations, but nowadays virtual teams reached great importance because of the benefits they give to the companies, such as time and money saving, reducing space, geographical dispersion, shorter time to develop new products, etc.

In the competitive market, virtual teams represent a growing response to the need for fasting time-to-market, low-cost and rapid solutions to complex organizational problems. Virtual teams enable organizations to take advantage of the talents and expertise of employees and non-employees by eliminating time and space barriers. Nowadays companies are heavily investing in virtual team to enhance their performance and competitiveness. (Ebrahim, Nader; Ahmed, Shamsuddin & Taha, Zahar, 2009)

Links:

“The four key to success with virtual teams”:

http://www.forbes.com/2010/08/19/virtual-teams-meetings-leadership-managing-cooperation.html?feed=rss_story

Virtual Teams:

http://www.youtube.com/watch?v=n1NyIBiYuFQ

REFERENCES:

• Robledo, Cristina; Organisations and Cultures; Class Slides; Universidad EAFIT, 2010

• Ebrahim, Nader; Ahmed, Shamsuddin & Taha, Zahar; Australian Journal of Basic & Applied Sciences; 2009, Vol. 3 Issue 3, p2653-2669, 17p, 1 Diagram, 8 Charts

• http://www.forbes.com/2010/08/19/virtual-teams-meetings-leadership-managing-cooperation.html?feed=rss_story

Motivation

Motivation is generally defined as the psychological forces that determine the direction of a person's level of effort, as well as a person's persistence in the face of obstacles. The direction of a person's behavior refers to the many possible actions that a person could engage in, while persistence refers to whether, when faced with roadblocks and obstacles, an individual keeps trying or gives up.

Most motivation theories are mainly focus their studies on trying to explain, predict or knowing how to influence individual’s behavior.

The first attempts to understand motivation clearly defined that there are internal needs and external incentives that influence the individuals’ behavior. The internal needs vary from one individual to another depending on their beliefs, values, thoughts, dreams, objectives, etc. Each individual has different needs and feels motivated in different ways to satisfy them. The external incentives refer mainly to the self interest and the economic gain that an individual could reach by doing something. For example doing a job and being paid for it.

After these attempts to understand motivation, many authors studied motivation and developed different theories that try to explain how motivation depending on the needs affect individuals’ behavior. I will explain those that I consider more important because of their contribution to the motivation studies.

Maslow’s hierarchy of needs: is a theory that explains needs from a progression hypothesis, where each need is a different level and each individual goes up to a different level when he satisfies the need of the level before.

Theory X and Y: this theory developed by Douglas McGregor, applies Maslow’s hierarchy of needs but at the same time he explains that there are “Low order needs (X)” and “High order needs (Y)”, depending on how an individual feels motivated. For example individuals motivated by money that have to be forced and continuously forced to do something belong to the group X. While individuals that are really committed to do something and they want to do it to feel satisfied, because of the need of recognition or personal growth belong to group Y.

ERG Theory: Is a theory developed by Clayton Alderferer, and in few words, this theory explains how individuals’ needs are there like a collage of needs, and as the time passes and the life goes through, each individual starts to feel more motivated to fulfill or satisfy different needs. Not like a progression hypothesis or levels of needs, just each individual decides which needs are more important than others giving them a hierarchy and feels much more motivated to satisfy the better ranked ones.


REFERENCES

• HRMagazine, Jul2010, Vol. 55 Issue 7, Special section p1-9, 9p

• http://www.corestrategies.com/

• Source: http://mkhanpmp.blogspot.com/2009_10_04_archive.html

Personality, perception and attribution + attitudes and values

Always when we talk about organizational behavior, organizational culture or national culture, is very important to have in mind that there even when most people of the same culture are very similar and have common characteristics, common beliefs and behave some times in the same way, there are also personal aspects that influence behavior of an individual. Those aspects are the personality, perceptions, attribution, attitudes and values that each individual has and has learned through time, living own experiences, learning from the people he relates to and sharing with people.

Personality is made up of the characteristic patterns of thoughts, feelings and behaviors that make a person unique. In addition to this, personality arises from the individual and remains fairly consistent throughout life. Most of those characteristics are learned through time and they are always affecting or influencing the behavior of any individual.

There are to determinant aspects that influence the “creation” of the personality of an individual: the heredity and the environment.

The personality of an individual is first influenced by the close people he relates with. For example family; Most of the times people that live with their family during his all childhood you can expect that they will behave as the other members of the family, and will adopt some characteristics from each member of the family to himself. In the other hand there are characteristics of the personality that the individual just has and develops during all his life.

In addition perception is always affecting the individuals’ behavior. Perception in few words can be defined as what you think you are, and what you think about the others before getting to know them well. Any situation you are involved in, you will create a perception of what could happen according to how you think you are going to act and how the other persons are going to behave.

All this I said before is to know that when you work with people from your own culture or different culture, is not enough jus knowing the main aspects of the culture. Is necessary to have in mind that there are aspects that make every person different from each other and that you will have to deal with, in order to create a comfortable work environment for everybody. Aspects like values that each individual has and the attitude towards any situation will be always present in any organization and every person must try to understand and comprehend in order to be able to create good and stable relationships at work.

Pygmalion Effect

The Pygmalion effect refers to a situation when you have great expectation on others, you give them great responsibility, and you let them see that a lot of people is expecting a lot from them, they will perform really good and they will feel very committed with their responsibilities, accomplish the mission you gave them, fulfill the objectives

Perception Video: “Don’t judge too quickly”

http://www.metacafe.com/watch/1277415/dont_judge_too_quickly_we_wont/

REFERENCES

• Li, Wen-Dong; Wang, Yong-Li; Taylor, Paul; Shi, Kan; He, Dan. International Journal of Selection & Assessment, Dec2008, Vol. 16 Issue 4, p366-384, 19p, 3 Charts

• http://www.lotsofessays.com/viewpaper/1684903.html

• http://www.accomplishlife.com/blogs/8/The-Pygmalion-Effect.html

• http://en.wikipedia.org/wiki/Pygmalion_effect

Organizational behavior + national and organizational culture

When we talk about organizational behavior, we refer to the study of individual and group dynamics in an organization, and at the same time the nature of the organizations themselves. Always when people interact in the organizations, there are a lot of factors that are very important to have in mind. Those factors will always be related to the internal and the external perspectives of each individual, and refer to the feelings, motivations, thoughts and the external environment the individuals relate to, respectively. The main objective of the organizational behavior studies focuses on trying to understand and model these factors. This subject is becoming more important as people with diverse backgrounds and cultural values have to work together effectively and efficiently.

Organizational behavior looks for understanding behavior in organizations in order to develop competencies that make us able to know how people are likely to behave. This knowledge may help us try to control those behaviors that are not beneficiating the objectives of the organizations.

One of the main topics related to organizational behavior is the organizational culture. The organizational culture in few words is the way that companies do things. Explaining and analyzing the last sentence a little bit more, what I meant is that each organization is just like a different country, with its own norms, rituals, values, power structures and control systems that vary from one company to another. Each company has its own organizational culture.

To be able to understand the meaning of organizational behavior and organizational culture, is would be really good for us to get a little closer to the meaning of culture itself, in order to be able to analyze and understand the possible impact that culture may have over the business environment of any organization. If you are able to understand a culture, for sure, you will be able to understand the behavior of any individual of that culture within an organization. Also understanding a culture will give us a series of advantages over our competition talking in terms of different organizations. You will be able to interact with the workforce, develop cultural sensitivity and empathy, and use these advantages as a competitive advantage to increase opportunities and developing the adequate strategies, increasing your expertise to manage different countries’ environments.

Power Distance

Situation 1:

There is a Japanese company that is looking to reduce costs on the production on one of the most important and sold products. They are also looking to keep the same quality and that the product doesn’t get affected. Since Japan is one of the countries with lower power distance, the Japanese executives’ first idea is to ask the plant of production employees for ideas. The production employees will be more than happy to give out their ideas to their boss.

Situation 2:

If the same situation I explained previously happens in India, the employees will never give their ideas out. India is one of the countries with highest power distance, and they respect a lot the hierarchical positions between them and their bosses. They will never be able to say to their boss what to do or what they think about their jobs or the production process of the company. The Indians will be always expecting that the boss will tell them what to do and even how to do it without any objection.

REFERENCES

• http://www.unesco.org/education/aladin/paldin/pdf/course02/unit_14.pdf

•http://humanresources.about.com/od/organizationalculture/Organizational_Culture_Corporate_Culture_in_Organizations.htm

• http://managementhelp.org/org_thry/culture/culture.htm