INTRODUCTION

What is Intercultural Management?

The globalisation of the economy, with increased cross-border alliances, ventures and global relocations, as well as the advent of e-commerce, has brought about major changes in the field of international customer relations and intercultural diversity management. This has led to an increased appreciation by companies that managing cultural differences properly can be a key factor in getting things done effectively across borders. With increased contact of personnel and customers from diverse cultural backgrounds, there is a growing demand for businesses to understand and manage the diverse values, perceptions, business worldviews and behaviour of corporations, staff, and its customers. Intercultural communication and management is an interdisciplinary human resources field concerned with facilitating communication, management and effective interaction of personnel and customers across borders.

It is well documented (e.g. Economist) that many companies have made massive losses through the mismanagement of international projects. Such losses are even clearer when one considers that statistically over three quarters of international acquisitions and alliances fail due to cultural differences. While intercultural management is a "soft" issue difficult to quantify financially, given the potential losses that have been made in the past, it is immensely important for companies to consider cultural issues properly when dealing in any major international venture, alliance or other cross-border project.

In an article (5 April 2001) in the Financial Times by Elisabeth Marx titled 'Shock of the alien can sink a merger', for instance, it was said that "Research on cross-border acquisitions has shown that differences in management style (particularly in attitudes towards risk) have a negative effect on company performance. Sadly, very few companies consider the softer, cultural factors of mergers, which may be a significant contributor to their subsequent failures. Far too few companies even begin to consider the effects on staff or the human implication of a merger." The article carries on to say that "it is easy to end up in a situation where the whole is worth less than the sum of its two parts", the very opposite of the intention behind the merger, and quotes the DaimlerChrysler merger as a case in point. The article advises: "Managers' first task is to conduct more extensive business analysis before taking the decision to merge. In addition to carrying out traditional financial and commercial due diligence, they should complete a thorough examination of the cultural compatibility of the parties involved."

The same applies when companies invest in premises or facilities in other country locations. Apart from the various financial, legal and logistic considerations, a company should carefully examine the human or cultural compatibility issues involved. This is an area where intercultural management consultants like Transcultural Synergy can offer invaluable support.

Please note that in some instances intercultural communication and management has also been referred to as business anthropology.

Typically institutions should consider the services of intercultural management specialists (or business anthropologists) when:

Transcultural Synergy is a intercultural management specialist focussing predominantly in cross-border post merger and alliance integration issues (see Services). For more information contact us, or you may like to download and view the presentation below:

To listen to an easy introduction to the field of intercultural management please click here to go Intercultural Models page and then press on the BBC link.

PRESENTATION

To view the Transcultural Synergy presentation, please use the download below:

Instructions:

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  4. To view, open folder and click on icon the file is compressed with Winzip unzip to file
  5. Open the file, the presentation will run automatically 

Cross-border Post-Merger Integration ..... Download (57 KB)

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