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Paper Topic:

Case Study Question and Answer

JOURNAL 5

MG 465 - INTERNATIONAL MANAGEMENT

Case 12 : DaimlerChrysler AG in 2004 : A Global Strategy Gone Sour p330

Due Date : 04 .04 .07

1 . Describe the problems that were associated with the merger , placing emphasis on the differences between German and American culture

The Daimler-Chrysler merger had encountered several problems most of which have been due to the culture differences of the two companies . The German company had a highly rigid structure that was used to controlling the operation of the company as well as the reliance on seniority and

hierarchy , on the other hand , Chrysler had a more flat and flexible structure , the relationship in the company was more of collaboration and teamwork . The differences in organizational structure reflects the cultural differences of the Germans and Americans , for example , the Germans moved the headquarters to Germany , a move that they consider as normal , while for the Americans it felt more of a takeover because they were not consulted . Another issue that had risen from the merger was the language difficulty . The German executives used German in board meetings , even if they new that the Americans did not understand the language , culturally , Germans are stiff and unaccommodating , they might have expected the Americans to learn their language since the headquarters is in Germany . To the Americans , it was viewed as disrespect and a deliberate means of limiting their participation Another problem for Chrysler was that executives were not willing to move to Germany , which was unanticipated when the merger was first discussed . This led to the resignation of many Chrysler executives because Americans had the freedom to choose , German executives were willing to work with the merger because they felt obliged to do so , as Germans are culturally inclined to respect authority

2 . Compare and contrast DaimlerChrysler global strategy with other global auto companies (View the global strategies chart , uploaded separate from the case

DaimlerChrysler had strong points in their global strategies in terms of worldwide market and distribution as compared to Nissan and Honda it also had been a major player in the global market although it has lagged behind GM , Ford and Toyota in respect to manufacturing and operation . At present , DaimlerChrysler is having difficulties with their merger as it has not produced the results that it was expected to have , whereas Nissan 's merger with Renault had been successful . With regards to current directions , DaimlerChrysler is concentrating on fixing their merger issues and cost-cutting , while the other auto manufacturers are on product development , technological advancement in design and plant operations as well as global expansion to new countries

3 . What do you think DaimlerChrysler should do ? What have they done (Research

DaimlerChrysler should have acknowledged the differences in cultural orientations of the two companies , as Germans and Americans seem to have very differing cultures . Before the merger , there should have been a wide scale and extensive information campaign and employee consultation as to the expectations and general feelings of both company 's workers about the merger . There...

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