Theory of Low and High Context Culture
Added on 2020-04-13
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Languages and Culture
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Running head: CASE STUDY ANALYSIS CASE STUDY ANALYSIS Name of the Student:Name of the University:Author Note:
1CASE STUDY ANALYSISTable of ContentsIntroduction................................................................................................................................2Various Stages of Merger Progression.......................................................................................2Reasons for DaimlerChrysler Merger........................................................................................3Analysis of the Various Issues Inherent in the DaimlerChrysler Merger Process.....................5Hofstede Model of the National Culture................................................................................5Individualism vs. Collectivism...............................................................................................6Theory of Low and High Context Culture.............................................................................8Laurent’s Study of Culture.....................................................................................................8Conclusion..................................................................................................................................9References................................................................................................................................10
2CASE STUDY ANALYSISIntroductionThe DaimlerCheysler merger has raised some important issues related to the cross-cultural communication as the earlier two organizations named Daimler-Benz AG andChrysler Corporation were from two different nations, sharing different working culture(Schneider, Schneider and Barsoux, 2003, p. 94). The report will focus on different stages ofDaimlerCheysler merger progression, the reason for the merger and the analysis of thevarious issues in the merger process by Hofstede Model of the National Culture, theory oflow and high context culture and Laurent’s study of cultureVarious Stages of Merger Progression.The Mercedes-Benz, a brand of Daimler-Benz AG, sold total 600000 vehicles andbecame the world’s largest manufacturer in 1995 and Chrysler sold 2.7 million units in thesame year and became the world’s sixth largest manufacturer. Therefore the companies at thetime of the merger were leading the market.In May 7, 1998, Daimler-Benz AG, a German manufacturer of internal combustionengine and motor vehicles merged with the famous American automobile manufacturerChrysler Corporation and constitutedDaimlerChrysler AG. Both these companies were joinedtogether to own a company, which code name was Q-star during 1994/95(Morosini andRadler, 2003, p. 4). The importance of formation of the Q-star was it was the initial entitybefore the official introduction of the DaimlerChrysler AG and the executives from bothcompanies could examine whether they could work together. However, the contacts between these two companies was being continued after fallingapart of Q-star. The importance of this stage was how the merger progression was proceededafter falling apart of the initial entity called Q-star.
3CASE STUDY ANALYSISProject Gamma, the code name given by Schempp and Robert Eaton to discuss aboutthe merger initiates was formed March 2, 1998(Morosini and Radler, 2003, p. 4). Theimportance of this stage that Project Gamma had given the more formal negotiations of theinformal talks between Schrempp and Eaton about the possible merger. According toMorosini and Radler (2003), the Project gamma had also provided opportunities toinclude the other important executives of both the companies. Under this project, delicate anddifficult issues were handled, like, the possible legal structure of the newly merged entity.Project Gamma was responsible for the name of the new joint company, the amount of thepremium paid to Chrysler shareholders and worker representation following the German lawin an American corporate environment(Morosini and Radler, 2003, p. 5). However,according to the suggestion of Project Gamma about the location of the newly formedcompany, the members of Project Gamma decided that, for taking the advantages of theGerman tax benefits, the new company should be located in Germany. On May 6, 1998, the international media had reported about the potential mergerbetween the Daimler and Chrysler for the first time. This is the final stage of the mergerprocess and the reason lies here in its final procedure. On the same day, the supervisory boardof Daimler-Benz met in Stuttgart and announced about the deal. On the next day, the dealwas announced publicly by the CEOs of both the companies. On May 14, 1998, thesupervisory board of Daimler-Benz AG provided the merger of its approval (Morosini andRadler, 2003, p. 5).Reasons for DaimlerChrysler MergerDaimler-Benz AG was the oldest car manufacturer company in Germany. Since mid1980s, the company had been going through number of radical changes. The company facedlargest loss in the German history when in 1995 the diversification strategy came into sudden
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