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Cross Cultural Business Study

Failure and success of the merger depends upon the culture of the merging companies, so far we have seen work culture of the Blue Sword, their need for the merger in order to become competitive in the International market and we have also analysed the reason why the Interbrew and Blue Sword merger was a failure. Furthermore we have explored the reasons that could have saved the Blue Sword and Interbrew merger; we also studied the various ways by which the Belgian management could have negotiated the issues of recruitment. The issues regarding the rewards, and motivational system is also explored and the reasons why the Post-Interbrew mergers were successful is also considered and in the last recommendation for the international team of the blue sword that can help the Blue Sword to avoid the future failures in the mergers. Finally we can say that the success and failure of the mergers and joint venture in china is mainly dependent on the employees integration rather than technical integration, but due to fast economic growth and large number of the foreign direct investment in the china, the collectivistic nature of the Chinese are now changing to more individualistic and as a result of this, the difficulty of implementing the standard HR policies of the western companies over the local Chinese companies is decreasing, and performance based award system for the employees are more common in china than the previous days, and new amendments in the labour law by the Chinese government also improved and increased the success rate of the mergers in china.

language english
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Preview of the essay: Cross Cultural Business Study

1. Joint Venture: A joint venture represents an agreement between two or more independent companies to mutually set up and manage a separate company to meet their prospect objectives (Horne, Wachowics Jr, and Bhadori, 2008: 586). This corresponds to the Joint Venture mutually established between Blue Sword and the Belgian Interbrew S.A. Unfortunately, this joint venture was doomed to failure due to the incongruent comprehension of organizational management, cultural incompatibility and local government interference. 2. PEST Analysis: PEST analysis stands for Political, Economic, Social, and Technological factors that represent a system or framework to investigate the impact of these macro environmental factors upon any industry (Eilert cited in Grant, 2008:66). However, since political, legal and economic factors are the manifestations of a culture, our focus will be primarily on the sociocultural factors that led to the catastrophic failure of the joint venture between Blue Sword and the Belgian Interbrewer. 2.2 Sociocultural: Chinese state own enterprises were highly affected by ideological political or social goals as an orientation for development rather than profit and productivity (Jackson, 2002: 174). 2.2.1 Cultural disparities: Hofstede (1991, 2001) comprehended five dimensions of cultural values including individualism-collectivism, high-low ...

... de Gruyer. Hofstede, Jan, G., and Pederson, Paul, B. (2002). Exploring Culture. USA: Intercultural Press. Horne, Van, James, C., Wachowicz Jr, John, M., and Bhaduri, Saumitra, M. (2008) Fundamentals of Financial Management. (Twelfth Edition), UK: Pearson. Wang, Y. (2007). Understanding Contractual Joint Venture in China. Journal of Chinese Economic and Business Studies, Routledge, Vol. 5, No. 1, 75–90. Available: EBSCOhost database. [Accessed 31st December, 2009]. Xu, Xinyi. 1995. "The impact of Western forms of social control on China." Crime, Law and Social Change 23, no. 1: 67-87. Available E-Journals, EBSCOhost [Accessed January 1st, 2010]. Jackson, T. (2002). International HRM a Cross Cultural approach. London: Sage Lewis, Richard, D. (2006) When Cultures Collapse. (Third Edition). USA: Brealy Maron, Robert, T., Harris, Philip, R., and Maron, Sarah, V. (2007). Managing Cultural Differences. (Seventh Edition). UK: Butterworth Heinmann Horwitz, F., Hemmant, R., and Rademeyer. (2008) Chinese Business Negotiations: South African Firm Experiences and Perspectives. South Africa: University of Cape Town. Available: EBSCOhost database. [Accessed 31st December, 2009]. Rousseau, Denise, M. (2006) Is there Such a Thing as “Evidence Based- Management”?. Carnegle Mellon University. Available: Google search. [Accessed 04 January, 2010].
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Humanistic Studies


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