Lecture 11

Common structure Russia Poland

Women’s Oganization Arab countries Latin America

South Africa Vatican USA

China France Turkey

“American management is ‘informal within a formalized frame’,
whereas British management is ‘formal within a non-
formalized customary patterns’”

“French firms run more bureaucratically, with orders and

procedures set from above, while German work organizations
relies more on the professional expertise which derives from
the trained knowledge and skills of more junior employees”

“Chinese organizations may have a dynamic operating within

them that allows them to accomplish informally what is done
by deliberate design in Western organizations”

“Many and possibly most Korean firms ‘look’ very Western. But,
it is sad, looks can be deceiving. ‘We talk the talk, Western-
style’, said one executive, ‘but we walk the walk, Confucian-
style’”
Percentage of managers who perceive organizations as a network of social relationships as
opposed to a bundle of specific rules, guidelines and objectives. (Trompenaars, 1993: 90)

Netherlands 43,77
USA 44,82
UK 48,89
Sweeden 49,47

Canada 51,26
Germany 52,84
Spain 53,39

China 53,73
Belgium 54,84
Australia 56,74

The Philippines 57,14

Brazil 57,35
Indonesia 58,55
France 59,96
Taiwan 60,55
Japan 61,62

Korea 63,58
Norway 65,98
Thailand 70,3

0 10 20 30 40 50 60 70 80
 Formalization
 Centralization
 Complexity
◦ Horizontal differentiation
◦ Vertical differentiation
◦ Spatial differentiation
 Mechanistic Organic

•High horizontal differentiation •Low horizontal differentiation

•High formalization •Low formalization
•Centralized decision authority •Decentralized decision authority
 NATIONAL CULTURE

SOCIETAL PRESSURE MANAGERS’ VALUES

CULTURALLY LEGITIMATE CULTURALLY MANIFESTED

PATTERNS OF ORGANIZING PATTERNS OF ORGANIZING

CONTINGENCY FACTORS
– SIZE
–TECHNOLOGY
–STRATEGY

NATIONAL DIFFERENCES
IN ORGANIZATION DESIGN
 Adaptation
◦ To survive firms take on characteristics in the
local environment.
 Internal consistency
◦ Organizational replication
◦ Imperative for control
Ford & Mazda

“To build a good relationship, you should not

look at each other but do things together and
look in the same direction”
“It is not about merging structures; it is about
working together to develop and sell cars,
which is not quite the same thing.”
In the context of merger and acquisition (transactions that always call for some
level of due diligence) people issues are cited as the top reason for the failure of
the merger (or acquisition) integration process, and there are a lot of failures.
Depending upon which articles you are reading, 50 to 75 percent of all mergers
are evaluated as "unsuccessful." Even so, inclusion of a thorough examination of
the human dynamics of the transaction is unusual in most due diligence
investigations. This is surprising because among the human dynamics are many
elements that are very important to the success of any business transaction.
Here are a few of the major elements:

 Management talent: The level and compatibility of leadership talent and

management styles is a vital element. This is especially important in view of the
fact that identifying and filling leadership positions early in the merger
integration process is essential.

 Retention: Success in retaining individuals key to continuing success and the

work force required for continuing production is crucial to any major
transaction. Retention is mostly a matter of human dynamics.
 Culture: An understanding of the compatibility of the cultures of the
companies involved in the transaction (and closely related to that, an
identification of the values that are important to those companies) is
necessary to any assessment of the level of effort required to achieve a
successful merger integration.

 Competencies: To ensure success it is necessary to catalog and provide for

the functional capabilities, resources, methodologies, information,
organizational structure, etc. required in order to achieve the strategic
objectives of the new company to be created by the merger or acquisition.

 Commitment: Performance levels will be impacted by any major transaction.

Quickly building commitment within the work force to the accomplishment
of new strategic goals is one of the first tasks of management.

source: http://www.saville.us/issue6.htm