Question : Please read the case study and answer the questions below.
Please read the case study and answer the questions below.
...........Summarize the case and your understanding of it
............What are some of the major differences you see in doing business in Germany if you are American?
.............Why do you think the Renault-Nissan merger worked, while the Daimler Chrysler did not work?
..............Think of ways that the Daimler Chrysler merger could have been encouraged to succeed.
DAIMLER CHRYSLER MERGER AND THE IMPACT OF CULTURE CLASH mler of Germany and and very uncomfortable. The result often 1998, Dai transmission, and a die- Ch ler of the United States merg from Daimler. But generally was that the Americans would think a engine The combination was intended to gen- there was little integration of the two consensus had been reached when in h th ith both Daimler and Chrysler fact the Germans just did not want to erate a company largely keeping their supply chains critical mass necessary to compete on lobal ban this to the previously dis- rate. Compare The means to analyze many of the scale in the auto industry are great cussed Ford Volvo merger, in which the problems at Daimler were also different. ted that wor dwide the fully integrated The Americans felt comfortable stopping input parts s expect the two firms. The separation of Daimler ber of firms wi decline dramatically at their bosses or anyone else's office over the next 50 years as the industry and Chrysler is clearly illustrated by the and discussing the issue at hand. They fact that there were corporate headquar- consolidates, seeking to reach the crit this creative. Germans, how ters in both the United States and Ger- cal mass necessary to survive ever, had a structured approach in which Contrary expectations. many. A single corporate headquarters lower level employees generated eoden value of Daimler's stock declined was never created. analysis of the problem ond then he announcement of the deal Another clear difference is the lan- and passed that analysis up the hierarchy until would continue to decline until it was guage di Almost a decision was made. This approach 50 percent of its orig- worth less than speak English. But Americans the Germans having much nal alue. Daimler would ltimatel seldom learn German, and la nguage larger staffs than the Americans. ave to sell Chrysler to private equity bility for individ over 40 ng a does not mean that Daimler This nvestors. Daimler purchased Chrysler years old tends to be much less than for did not realize they had a $36 billion and woul younger people. The result was that lan- and try to address it. For example, ly sell it for less than $5 billion guage difficulties would continue to ication among encourage comm Combining two fi always very the two firms work ng together. s, the firm forced both various partie difficult and, n this case, problems However, more critical to the failure rms to use IBM Lotus Suite, which ld not be the d in national cul lowed instant messaging among Particularly problemati of Germans and Americans, German c in integrat the parties, but this did not address the two fi their di tends to be hierarchical, the underlying d fferences. The out- n culture. Some of these diff while as noted earlier of these di ific. For exam ple, the two fi very egalitarian a nd prefer flat the synergy lly expected between focused on two different types of prod- zations. One impact of this was that the Chrysler and Daimler was never been ucts. Daimler sold high-end, highly engi felt America lized. neered automobiles. In contrast, Chrysler nstructured, while the Americans found the Germans too rig id. T Ilustrate, Ger- was a scrappy, cost-conscious company. Corcoran, G. 12OO7 aware of this differ- The Germans were mans typically take a problem, analyze Chrysler buy Mr. Bruner but they ble to truly it, di the potential solutions, weighs in Wall Street Journal Online. http://blogs wsi.com/deals/2007/O5/14/ value the American brands. This had one, and then move on. Americans use two results. First, the brands of the two a much more in teractive process. They firms were tegrated not only have active discussions with dmonson, G. & Welch, D. C2005. August meant that brand management for this large numbers of people, but they revisit 15 Dark days at Daimler. BusinessWeek, bined firm became confusing or insights pp. 31-38. Additional lly, the two fi become available. At Dai ler Chrysler. Ostle, D. (1999, November 220. The cul able to fully integrate their sup the Germans felt that once the decision pply chains. ture clash at Daimler Chrysler was worse Automotive News Europe, The Daimler engineers felt had been made, they would not revisit a Vol. 4, lso felt Chrysler lower cost/lower quality inputs problem. The Germans 18). How Daimler, would damage their brand image, and ncomfortable with the active give and Daimler did not want to share its parts take of the American The Americans sbox.co.uk/detailed Business/ with Chrysler. Chrysler would ultimately saw such in teractions as healthy, but to the Germans frontational 122434.html