8OrgAccult Kompatibilit Si m d

7/29/2019 8OrgAccult Kompatibilit Si m d

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Organizational Culture and

Acculturation

Balzs Heidrich, Ph.D

ESSCA Budapest


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The Concept and Definition ofCorporate Culture

Bringing fuzzy ideas closer to

reality


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What is OrganizationalCulture?

The way we do things around here (Bower, 1982)

Martin, 1984)

The collective programming of the mind (Hofstede,

1991)


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What is Organizational Culture?

A pattern of basic assumptions that the group has learned as

it solved its problems of external adaptation and

integration, that has worked well enough to be consideredvalid and therefore, to be taught to new members as the

correct way to perceive, think, and feel in relation to those

problems (Schein, 1985)


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Can Culture Be Known?

Is it a can of worms?

Is it dangerous to have an insight to

your own culture?

Who should hold the organizationalmirror?


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Elements of Corporate Culture

Business environment

Values

Heroes

Rites and Rituals

Cultural Network


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Cultural Forms ofCorporations

Symbols (objects, settings,leaders,heroes, roles)

, ,songs, humour, jokes, gossip,proverbs)

Narratives (stories, legends, myths)

Practices (rituals and taboos, ritesand ceremonials)


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Characteristics ofCorporate Culture

Individuals make up a

culture

Culture make sense and

have coherent points of

Culture can e rewar ersof excellence

Culture is a set of

affirmations

Cultural affirmations tend

to fulfill themselves

Culture provide their

members with continuity

and identity

A culture is in a state of

balance between

reciprocal values


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Characteristics ofCorporate Culture (contd.)

Corporate culture is a cybernetic

system

Cultures are patterns (hologram)

Cultures are more or less synergistic

Only cultures can learn-and

organizations must learn


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Definition of subcultures

Organizational subcultures consist

ideologies, cultural forms, and

other practices that identifiable

groups of people in an

organization exhibit.


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Characteristics of subcultures

Differential interaction

Similar personal characteristics

Cohesion


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Types of subcultures

Enhancing subcultures (views of the top

management are reproduced in an

exaggerated form)

Countercultures (the islands ofresistance to the overall culture)

Orthogonal cultures (neither in favour

nor against the views of the topmanagement)


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The McKinsey 7S Model

Strategy

Structure Style

StaffSystem

Skills

Shared

Values


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The Concept And Process of Acculturation

Can Cultures Really Merge?

Balzs Heidrich, Ph.DESSCA Budapest


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The Definition of Acculturation

Acculturation: is the term used to describe the process by

which two groups that have come in direct contact resolve

the conflicts and problems that inevitably arise as a result

of their contact. (Nahavandi and Malekzadeh)


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Stages of Acculturation

Contact

Conflict

Adaptation


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Stages of Acculturation 1.

Contact: The outcome of the relationship will depend on a

number of factors ranging from the type of merger to the

. ,

the initial contact is likely to engender some level ofconflict


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Conflict: (based on the intensity of the contact)

Little:no daily interaction, not much conflict. Financialum re a.

Large:similar markets, similar technology, therefore moreconflicts. Fight for power, resources etc. Both cultures are

strong.


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Adaptation:

Positive adaptation: groups come to an agreement overow synergy s ac eve . c opera ona an cu ura

elements will be preserved and which will be changed?

Negative adaptation: One or both groups feel cheated andcontinue resistance.


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Modes of Acculturation

Assimilation

Integration

Separation

Deculturation


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Modes of Acculturation-Assimilation

The acquired firm gives up its practices, procedures,philosophy and assimilates into the acquiring firm.

e ow o cu ure s one way.

Willingness to change stems from a weak, unsuccessfulculture.

One of the most common mode of acculturation.


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Modes of Acculturation-Integration

The acquired firm maintains its cultural identity. Success isneeded.

e acqu re rm ecomes ega y an nanc a y e par

of the acquiring company but cultural elements can be

retained.

Both firms change some cultural elements.


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Modes of Acculturation-Separation

Attempt of the acquired firm to retain all cultural elementsand practice.

e organ za on re uses o ass m a e a any eve .

Strong culture of a small company, which is to bemaintained under the financial umbrella of the larger firm.


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Modes of Acculturation-Deculturation

Least desirable mode

Loss of all cultural elements

The culture of the acquire firm is weak, ut not willing to

adapt to that of the parent company

Conflict and confusion at all level

Acculturative stress


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The Age of Mergers and Acquisitions

More than half of the M&A are financial failures No better success rate within the same industries

Reasons for failure:

Inappropriate selection of the partner

(org.culture)

Mismanagement of the acculturation process

The organization wide resistance of the

employees to changes

The same rate of (un)success in case of strategic alliances


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Mergers and/or acquisitions?M&A

Makes a big difference, legal- and power wise!

Merger: a combination of organizations of fairly similar

s ze, w c creates an organ zat on w ere ne t er party

can clearly be seen as the acquirer. (Vaara, 2001)

Acquisition: when one company buys enough shares to

gain control of another.


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Double Acculturation

Organizational and national level counts as well?

Scandinavian companies prefer to enter business

par ners ps w o er can nav an an or mer can

firms (Avoid alliances with Japanese and Latin companies)

Cross-border M&A are more successfull!


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A Possible Solution

Cultural Synergy

u ura erences as a source o va ue

Creating a third culture (comparison and differences are

not emphasized!)

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