Cultural Due-Diligence

The world of business is changing and organizations are finding cross-border mergers are greatly different from their domestic acquisitions. The influence of national culture can be dramatic and leaders are discovering those differences can have a great impact on the success or failure of the partnership. The success of a partnership depends on many classical factors such as financial risk, legal liabilities, and capability to deliver.

 

However, working with people of other cultures leads to the realization that national culture influences business culture. National and regional cultural groups can affect the behavior of organizational members. Subcultures within the organization between functional disciplines add more dimensions of cultural influence. Cultural conflict often inhibits people’s ability to work together effectively, resulting in unnecessary frustration, and lowered performance.

 

Extensive research by Dr. Hagelthorn demonstrates during acquisitions or partnerships, few organizations understand the business or national culture of the other organization and that inability to understand adds tremendous costs to multinationals in both money and success.

 

Aligning the cultures between the two organizations helps in establishing common ground for operations. Organizational leaders must understand the differences in management styles and national cultural barriers, and they must have a process for team members to address issues resulting from differences. Identifying national cultural barriers during due diligence will help organizational leaders plan the resources and programs needed to integrate the two cultures.

 

Mélange Global Solutions will help those organizations to identify and address the shortcomings of partnership effectiveness by exploring the relationships and the effects of business and national culture during due-diligence and guide the new organization to address cultural issues before they become organization problems.