Organization Culture Could Help Organizations Merging Business Essay

The research aims to analyze that to what extent the organization culture can help organizations merging, and how to manage or develop the organization culture. The objectives are as follows:

To identify the organization culture could help organizations merging.

To demonstrate that to what extent the organization culture can help organizations merging with data analysis.

To analyze the strategy of manage or develop the organization culture based on the practise of two well-known European and American companies.

To determine the future perspective of the organization culture in the development of the organization merging and management.

Based on the above aim and objectives of this research, the author mainly researches the following questions.

Research Questions

How is the organization culture development status in European and American companies?

What is the contribution and position of organization culture to the development of organizations?

What is the impact of organization culture on the organizations merging?

Whether the organization culture can help organizations merging?

Why the organization culture can help organizations merging?

What extent the organization culture can help organizations merging?

How to manage or develop the organization culture for European and American companies?

1.3 Rationale of the Research

The complex posed by the cultural characteristics of different forms, is a stable long-term cultural values ​​and historical traditions and unique management style. It permeates daily life and production and operation activities, rooted in the psychology of the employees. The business combination is the breaking of the original corporate culture model, in absorbing the cultural advantages of both sides on the basis of the formation of a new corporate culture. This determines the two cultures (especially backward culture) to be severely affected, along with conservative and cooperation of the entire integration process, backward and advanced contest contradictions in the integration process, conflicts. Therefore, the business combination cultural conflict is inevitable; it is a concentrated expression of the corporate conflict.

1.3.1 The reason of conflict between the corporate cultures in the process of merger

The corporate culture is a long-established corporate culture concepts and historical traditions and unique business spirit and style, including the guiding ideology specific to an enterprise development strategy, business philosophy, values, ethics, and customs. Its constituent elements can be summarized in five points: the business environment is the most important factor shaping corporate culture; corporate values ​​forming the core of the corporate culture; corporate heroes are the values ​​of the “personification, to follow the example of the specific model of staff; ceremony and ceremony it is a plan of the day-to-day routine, a dynamic culture corporate values ​​can be a sound and development; the cultural network communication companies grassroots organizations passing awareness of values ​​and heroes channels. corporate culture guide corporate members consciously make employment options in line with corporate values​​, specific values ​​will motivate employees to meet the business needs of behaviour exhibited in a specific environment; affected by the same values ​​and code of conduct of the employees in different time will inevitably tend mutually coherent.

The corporate culture has the multifaceted double feature. First, the uniqueness and diversity coexist. The corporate culture is an objective reality, only the pros and cons of high and low points, no presence or absence of the other. The enterprise has a unique corporate culture. Due to industry, industry, ownership, regional history and culture is different, different enterprises even greater differences in corporate culture, which is the uniqueness of the corporate culture. As the corporate culture is mainly an ideological thing. Thus, it has strong historical continuity, changes flaccid. Various corporate culture cannot be as easily change and fusion equipment updates, asset restructuring, corporate restructuring, which constitutes a reorganization after the corporate culture of diversity. They tend to continue to exist within a very long time and play a role. Conflict and friction become a corporate restructuring of the cultural barriers. Secondly, Positive and negative coexist. After the reorganization of the diversity of corporate culture have positive and negative two opposing characteristics. The positive aspects of performance at all levels of the corporate culture smooth integration of complementary advantages, and in the training and selection process for both sides agree that the values ​​and norms. Such as combination, both exclusive their own arrogance psychological, and absorb the essence of each other in mutual understanding, and thereby create a stronger corporate culture on the basis of their existing corporate culture essence. The negative aspects of performance for the restructured corporate culture conflict produce adverse factors hinder enterprise development. Considerable force union, because of the strength of the two sides evenly matched, it is easy to admit defeat the situation, both sides consider themselves excellent and refused to accept the new culture and communication, and the parties cannot understand each other, and the construction and implementation of the impact of restructuring the corporate culture, which a powerful combination is not strong, weak and weak after the joint more weak condition. Third, Progressive and reverse sexual coexist. Corporate restructuring and cultural integration need to go through some of the run-in period, and impossible for a pier, which has a progressive. And performance is a special kind of reverse that the reorganization of enterprises material culture, system culture first run-in, rather than spiritual and cultural materialized result of the process of integration between the two sides. General corporate culture always follow the spiritual and cultural – institutional culture – material culture – the new spirit of the culture – a new institutional culture – the law of the circular motion of the material culture constantly development, restructuring enterprises culture level fusion, but rather to the contrary. After the corporate restructuring is always to material cooperation, and then develop the system, which deep-seated influence of the spirit of enterprise culture, with the reverse sexual. If you ignore the above features of the corporate culture, and asked to produce some kind of racial superiority, miscommunication, and self-cantered implementation and management, it will inevitably lead to a deep-seated cultural conflict in mergers and acquisitions subject.

1.3.2 The type of conflict between the corporate culture in the process of merger and reorganization

1.4 Research Instrument and Research Process

In this paper, research methods include literature review and interviews. In this study, the literature is from related papers, books, mainly from the review of different countries’ research and research system analysis. This paper is mainly used for interview of managers and staff in European and American famous companies and then collects relevant data.

The population for the study will be the managers and staff in European and American famous companies with specific interest in those who played an important role in the development of organization. Twenty samples representing twenty different ideas will be taken into research[4].

This means that the research is design the study to be both qualitative and quantitative while an analysis secondary research data will be done to put the research into context. The responses will be analyzed using the Microsoft Excel.

1.5 Thesis Outline

The dissertation is divided into five chapters namely introduction, literature review, research methodology, findings and discussions, and conclusions. In chapter one, the research background, the aim and objectives, research rationale, research instrument and process, thesis outline underlining the conduct of the research as well as the relevance of this study for both academic and non academic (industrial) purpose are presented. In chapter two the researcher discusses the literature review, which contains the strategy, the definition and characteristic of the organization culture, the content of organization culture, the cross-cultural issues of cross-border mergers enterprises, and the reason and type of the organization culture conflict in the process of organization. In order to facilitate ability make references, appropriate referencing study has been employed in the in-text write a corresponding out-text format at the end of the study. The researcher was careful to select and discuss the most recent where possible forms of academic and non academic literature. In chapter three, the researcher has expounded on the methodology used in this research and has provided justification for the use of each of the methods. The section also highlights the choice of the population and the selection of an appropriate sample and data collection instrument. The chapter ended with a highlight of the test of validity of the instruments to be used in collection data as well as the quality of supporting staff with who the researcher undertook this study. In this study the data analysis will be very much depended as the main analytical device for the collected data. Some of these include frequency distribution tables, and test of significance. This will be discussed extensively in the fourth chapter of this study. In chapter four, the analysis and findings are present. The conclusions of this research will be the last part of this study and would be handled in the fifth chapter. As usual references to this study and other information needed for ease of study will be provided in the appendix [5].

Chapter 2 LITERATURE REVIEW

2.1 The definition and characteristic of the organization culture

The organization culture is constituted by the values of the enterprise, operating criteria, management style, entrepreneurship, ethics, and development goals which are agreed by all employees in the business practice (V. P.Clinton, 2007). Some scholars believe that the organization culture should be divided into two levels, broad and narrow aspects (Roslender, Robin; Hart, Susan J, 2002). The organization culture in the broad sense refers to the combining of the spirit wealth and material wealth which the enterprises process in the process of production and management; the narrow definitions indicated that the organization culture is ideology in the development process, habits and values, and its core is the company’s values (Perry, John; Woods worth, Anne, 2005)[6].

Many scholars believe that the organization culture is the combination of material and spiritual, and also an integration of software and hardware. The external cultures are present with the plant equipment, raw materials and products; in addition, the internal cultures rely on the performance of enterprise management system, behaviour patterns of the spiritual world (H. Chen, 2006)[7].

From the definition of the organization culture that scholars gave above, their opinions were varied, the coverage is not consistent. Some observed from the point of view of the material carriers, some focused on the spiritual aspects, others put both unify visits. While these visits are different, but on the whole, for the understanding of the organization culture, they all thought that organization culture should focus on people, which was a human-centred approach to management, enterprises should be the organizations with a common mission and responsibility. The core of the organization culture is a shared value, common beliefs of enterprise employees; it is the philosophy of guiding the behaviour of businesses and business people (Alberto S. Pereira, et, 2008)[8].

The characteristic of the organization culture mainly include the following aspects:

1. Differences

The cultural styles of companies in different societies, different nationalities and different regions are different, even if the two enterprises may be very similar or even in the same environment, facilities management organization and system, their culture are showing different characteristics and charm (Bisin Alberto, Thierry Verdure, 2001)[9]. This is decided by the business survival social environment, geographic, economic and external environment, as well as the industries in which the special nature of the enterprise, to decide its own operation and management characteristics of the entrepreneur’s personal style and overall quality of staff and internal conditions.

2. Recognition

The organization culture is undoubtedly a common value judgments and values, which is the “consensus” and “identity” of the majority of employees (Christine M, 2006). Excellent organization culture particularly paid attention to the Group and the group mind, the pursuit of “integration” and “shared vision” (Avlonitis, George J.; Hart, Susan J.; Tzokas, Nikolaos X, 2000)[10], replacing the whole consciousness against individual consciousness. The organization culture is not to force people to comply with rigid rules and regulations and discipline, but emphasis on cultural identity, emphasizing the sense of autonomy and initiative of the people, through the consciousness of inspired people to achieve self-control and self-discipline (Richter, F.J.; Vettel, Kai, 2006).

3. Relative stability

Generation of culture presented a long-term process, and cultural role has stretches (Schein EH, 2009)[11]. A positive organization culture, in particular the formation of Habitat core of values​​, often take a very long time, requires a model of advanced people, need some trigger event, requires the patience of the leader. Organization culture as a “sub-culture” (Roslender, Robin; Hart, Susan J, 2003)[12] also has the general properties of the culture (Ricky Griffin, 2010). Once formed, it will become the soul of business development, it will not chop and change, not adjust and change with the change of the leadership of the organization and fundamental, it will play a important role in the enterprise for a long time.

2.2 The content of organization culture

Organization culture can be divided into the business philosophy, entrepreneurial spirit, corporate ethics, teamwork, and corporate image (Bhimani, Alnoor, 2003).

The business philosophy is usually considered to be in the day-to-day operations of the enterprise methodology (V.Scotter, 2006). Intense and complex market competition, using the scientific method to guide enterprise survival and development, which is a business philosophy content.

The spirit of enterprise is the soul, which is the core of the organization culture. It refers to the mental outlook of the corporate mission, purpose, vision of development and employees (Williamson, Bill, 2001).

Corporate morality is used to adjust between the code of conduct and businesses and their customers, internal employees (Williamson, Bill, 2001). Moral regulation does not have the force factor, but from an ethical relationship perspective, it is essential. Moral restraints and constraints could make people understand the values ​​oriented.

The team spirit is the concept of collective organization members and it is the psychological factors of forming cohesiveness (Claver, Enrique; Llopis, Juan; Garcia, Daniel; Molina, Hipolito, 1998)[13]. Regardless of rank, qualifications or background size, all employees of the enterprise should be united under the guidance of the same values ​​forward, and concerted efforts to make the efficient operation of enterprises.

The corporate image means that it should be recognized by consumers and the general public through the external characteristics (V.Scotter, 2006). LOGO, identifier are the intangible assets which could continue to add value with the expansion of corporate influence.

The theoretical system of the organization culture outlined five elements, which contains enterprise environment, business values, model employee, the form of corporate etiquette and cultural networks (Perry, John; Woodsworth, Anne, 2005)[14].

Enterprise environment is different from the internal office environment, which contains the aspects of the business direction, corporate social image, the enterprise outside (Ketchen Jr, David J.; Giunipero, Larry C, 2004) [15]and so on.

Operating values ​​are the core of the organization culture, the unite of values ​​could make internal members have a unified behaviour criteria, good and evil, right and wrong could have clear identified standards (Bhimani, Alnoor, 2003).

Model employee means that the excellent staff who dedicated to companies under the guidance of the organization culture (Claver, Enrique, et, 1998)[16]. The correspondence between organization culture and exemplary employees likes the corresponding soil and flowers.

The business etiquette form of the enterprises refers various recognition awards, as well as all the business values ​​interpersonal activities. Employees to comprehend cultural connotation of the spirit in the lively activities are more effective than institutional constraints (Irani, Zahir; Sharp, John M, 1997).

Cultural network is mainly used for the dissemination of organization culture, internal corporate employees wish and social radiation function. Objectivity, stability, openness, flexibility, uniqueness characteristics; organization culture also has cohesion function, constraints, function, value-oriented functions, social and radiation (Perks, Helen; Easton, Geoff, 2000).

2.3 The cross-cultural issues of cross-border mergers enterprises

The enterprises use resources in the world; combine with host locally owned human resources, natural resources, and even the size of the market, and other advantages in the form of cross-border mergers which contain acquisitions, capital, technology, management skills, market linkages, research and development, which could expand transnational business, achieve complementary advantages and become the main form of enterprise international business on a global scale (Davis, R. C, 1991). International companies in cross-border mergers and acquisitions will inevitably encounter the unprecedented opportunities and challenges in a different cultural background and geographical environment.

The opportunities: cross-cultural advantage

In different cultural backgrounds, different social customs, beliefs, traditions, market conditions, technical level, human natural resource conditions could create market opportunities and high profit return for international companies. This can be reflected in the “cross-cultural superiority” (David Chart, 2002) brought in multinational operations.

John Dunning’s eclectic theory referred that companies only have ownership, internalization, and location-specific advantages, in order to engage in foreign direct investment. In different cultural backgrounds, different socio-cultural practices, beliefs, traditions, market conditions, technical level, human natural resource conditions could create market opportunities and high profit return for international companies. This can be reflected in the “cross-cultural superiority” (Wagner, Stephan M.; Johnson, Jean L, 2004)[17] brought in multinational operations. World countries such as the U.S. McDonald’s used the multinational operations, its “fast-food” culture can be radiated to different cultural backgrounds, including the Asia-Pacific region (Wagner, Stephan M.; Johnson, Jean L, 2004)[18].

Challenges

Culture to the international M & A business operator brings opportunities, but it is a huge challenge. Different cultural environment, as well as the different economic, social and political factors must form larger cultural differences. Due to the evolution of the culture is a long and slow process, these cultural differences in terms of the enterprise, will not be eliminated over a period of time, and may remain stable over time. The objective existence of cultural differences, a cultural conflict between enterprise and business executives and employees is the formation of a “culture shock” (Cheng Liling, 2005) psychological reaction.

In a specific international corporate acquisitions, the cultural causes of the conflict: the ethnocentric, improper use of management practices, the different perceptual miscommunication, cultural attitudes, and so on (Wagner, Stephan M.; Johnson, Jean L, 2004)[19]. Cultural conflict will lead to a series of consequences:

(1) ultra-conservative: cultural conflict affect the harmonious relations of multinational managers and local employees, according to rigid rules and regulations to control the operation of the enterprise, even more alienated employees (Irani, Zahir; Sharp, John M, 1997); At the same time, employees become complacent manager The implementation of the scheme is also very difficult, the results of both will not make a difference.

(2) Communication interrupt: When the distance between managers and workers to a certain extent, the bottom-up communication will naturally interrupt results managers can not know the truth, the two sides further and further away in a different direction (Fletcher, K; Wright, G, 1996).

(3) Non-rational response: managers if they cannot correctly deal with cultural conflict, it will rely emotional. This irrational attitude can easily lead employees irrational retaliation more results misunderstandings, the deeper contradiction, antagonism and conflict gets keener (A. Nahavandi& A¼ŒR.Malekzadeh, 1993).

(4) psychological grudge: clashes, the parties to the conflict if not patient from each other’s cultural backgrounds in the pursuit of cultural “total phase”, just to complain about each other’s reckless or conservative, the result will only cause widespread grudge psychological. Cultural conflicts arising from cross-border mergers and acquisitions of enterprises, a desire to achieve a successful business enterprise, no doubt is a great challenge, if not for effective management, it will result in the loss of international corporate market opportunities and the low efficiency of the organizational structure. Internal management, due to the different values people, living life goals and behavioural norms will inevitably lead to increased management fees, increasing the difficulty of the integration and implementation of corporate goals, improve the running costs of the enterprise management. In external operations, due to the cultural differences of language, customs, values ​​makes more complex operating environment, thereby increasing the difficulty of market operators(Perks, Helen; Easton, Geoff, 2000).

Except the above discussion, lots of scholars analyzed the cross-cultural issues of cross-border mergers enterprises. Through the analysis of the culture conflict, the essence of enterprise culture was explained and the integration modes were analyzed. Meanwhile, in 2010, Song Ying combined with the case of “TCL and Thomson’s merger”, the process of enterprise cultural integration was designed. It is meaningful for the enterprises in China to resolve the same questions (Song Ying, 2010).

2.4 The reason and type of the corporate culture conflict in the process of organization restructuring

The complex posed by the cultural characteristics of different forms, is a stable long-term cultural values ​​and historical traditions and unique management style (Dvaid Chart, 2002). It permeates daily life and production and operation activities, rooted in the psychology of the employees. The business combination is the breaking of the original corporate culture model, in absorbing the cultural advantages of both sides on the basis of the formation of a new corporate culture (V.Scotter, 2006). This determines the two cultures (especially backward culture) to be severely affected, along with conservative and cooperation of the entire integration process, backward and advanced contest contradictions in the integration process, conflicts (V.Scotter, 2006). Therefore, the business combination cultural conflict is inevitable; it is a concentrated expression of the corporate conflict.

2.4.1 The reason of the corporate culture conflict in the process of organization restructuring

The corporate culture is a long-established corporate culture concepts and historical traditions and unique business spirit and style, including the guiding ideology specific to an enterprise development strategy, business philosophy, values, ethics, and customs (Schein EH, 2009). Its constituent elements can be summarized in five points: the business environment is the most important factor shaping corporate culture; corporate values ​​forming the core of the corporate culture; corporate heroes are the values ​​of the personification, to follow the example of the specific model of staff; ceremony and ceremony it is a plan of the day-to-day routine, a dynamic culture corporate values ​​can be a sound and Development; the cultural network communication companies grassroots organizations passing awareness of values ​​and heroes channels. corporate culture guide corporate members consciously make employment options in line with corporate values, specific values ​​will motivate employees to meet the business needs of behavior exhibited in a specific environment; affected by the same values ​​and code of conduct of the employees in different time will inevitably tend mutually coherent (Richter, F.J.; Vettel, Kai, 2006).

The corporate culture has the multifaceted double feature. First, the uniqueness and diversity coexist (Chow, Chee W.; Harrison, Graeme L, 2009). The corporate culture is an objective reality, only the pros and cons of high and low points, no presence or absence of the other (Bhimani, Alnoor, 2003). The enterprise has a unique corporate culture. Due to industry, industry, ownership, regional history and culture is different, different enterprises even greater differences in corporate culture, which is the uniqueness of the corporate culture. As the corporate culture is mainly an ideological thing (Fletcher, K; Wright, G, 1996). Thus, it has strong historical continuity, changes flaccid. Various corporate culture cannot be as easily change and fusion equipment updates, asset restructuring, corporate restructuring, which constitutes a reorganization after the corporate culture of diversity (Bhimani, Alnoor, 2003). They tend to continue to exist within a very long time and play a role. Conflict and friction between each other become a corporate restructuring of the cultural barriers. Secondly, the enthusiasm and the coexistence are negative. After the reorganization of the diversity of corporate culture have positive and negative two opposing characteristics. The positive aspects of performance at all levels of the corporate culture smooth integration of complementary advantages, and in the training and selection process for both sides agree that the values ​​and norms. Such as combination, both exclusive their own arrogance psychological, and absorb the essence of each other in mutual understanding, and thereby create a stronger corporate culture on the basis of their existing corporate culture essence. The negative aspects of performance for the restructured corporate culture conflict produce adverse factors hinder enterprise development (V.Scotter, 2006). Considerable force union, because of the strength of the two sides evenly matched, it is easy to admit defeat the situation, both sides consider themselves excellent and refused to accept the new culture and communication, and the parties cannot understand each other, and the construction and implementation of the impact of restructuring the corporate culture, which a powerful combination is not strong, weak joint condition. Third, the coexistence is progressive and reverse (Claver, Enrique, et, 1998). Corporate restructuring and cultural integration need to go through some of the run-in period, and impossible for a pier, which has a progressive. And performance is a special kind of reverse that the reorganization of enterprises material culture, system culture first run-in, rather than spiritual and cultural materialized result of the process of integration between the two sides (Irani, Z.; Beskese, A.; Love, P. E. D, 2004). General corporate culture always follow the spiritual and cultural – institutional culture – material culture – the new spirit of the culture – a new institutional culture – the law of the circular motion of the material culture constantly development, restructuring enterprises culture level fusion, but rather to the contrary. Always the first material cooperation corporate restructuring, and then develop the system, which deep-seated influence of the spirit of enterprise culture, with the reverse sexual. If you ignore the above features of the corporate culture, and asked to produce some kind of racial superiority, miscommunication, and self-centered implementation and management, it will inevitably lead to a deep-seated cultural conflict in mergers and acquisitions subject.

2.4.2 The type of the corporate culture conflict in the process of organization restructuring

1. Corporate culture change

According to analyze and conclude some scholars’ views about corporate culture change, we could know that corporate culture change includes three aspects: behavioural and cultural change, institutional culture change and spiritual and cultural change (Chow, Chee W, et, 2009).

(1) Acts of cultural conflict

Corporate behavior and culture means that employees in the production and management, learning activities and cultural entertainment. It includes a cultural phenomenon in business, education, advocacy, interpersonal activities, cultural and sports activities (Roth, Martin S, et, 2004). It is a corporate management style, mental outlook; the interpersonal dynamic embodied the spirit of enterprise, the corporate values ​​of refraction. The personnel structure is divided, including entrepreneurial behaviour, the behavior of the enterprise model figures, the behavior of the employees and corporate behaviour (Irani, Z.; Beskese, A.; Love, P. E. D, 2004). M & A behavior occurs, the original mission of the enterprise will be changed, and corporate goals will change behavior to achieve organizational goals as a guarantee cultural friction, collision and conflict can also occur. Especially in the case incurred by the merger to shake our corporate values ​​and basic spiritual pillar collapsed, this conflict is more intense. Cultural change of corporate behavior entrepreneurial behavior, and establish exemplary hero and regulate employee behavior to change. These measures tell employees what is to do and what not to do, making the employees (especially combined enterprise employees) acceptance of the culture change corporate behavior. Plasticity is very strong, so the change of the culture of corporate behavior, the risk and difficulty of relatively small, but also not to be taken lightly, and care should be taken to integrate.

(2) System of cultural conflict

The institutional culture mainly includes three aspects of corporate leadership structure, corporate organizations and enterprise management system (Wagner, Stephan M.; Johnson, Jean L, 2004). Cultural transformation of the enterprise system is preparing for the behavior of the culture and philosophy of cultural change, institutional change corporate culture, and corporate