Working Abroad - Cultural Differences impact Mergers and Acquisitions

According to a KPMG study, "83% of all mergers and acquisitions (M&As) failed to produce any benefit for the shareholders and over half actually destroyed value". It was cited that the overwhelming cause for failure "was the people and the cultural differences".

Difficulties encountered in M&As are amplified in cross-cultural situations, when the companies involved are from two or more different countries.

Merger success is possible; however, being part of the 17% that succeeds, rather than the 83% that does not deliver, requires more than insight. Merger success is based on acceleration, concentration and creating a critical mass for operational change (adaptation).
Up to the point in the transaction where the papers are signed, the merger and acquisition business is predominantly financial - valuing the assets, determining the price and due diligence. Before the ink is dry, however, this financially-driven deal becomes a human transaction filled with emotion, trauma, and survival behaviour - the non-linear, often irrational world of human beings in the midst of change.
In the case of international mergers and acquisitions, the complexity of this process is often compounded by the difference in national cultures. People living and working in different countries react to the same situations or events in very different manners.
Therefore, a company involved in an international merger or acquisition needs to consider these differences right from the design stage if it is to succeed.

Need help or support with cultural issues?


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Cultural Issues - Mergers and Acquisitions

Companies in Mercer Study "Very Concerned" about Top Talent Departure

Only a small number of companies analyze cultural issues as part of their integration plans for mergers and acquisitions, according to feedback from global human resource leaders attending Mercer’s M&A Ready™ workshops. Only 25 percent of respondents indicated their company had a process for addressing cultural issues to ensure more successful business integrations.

According to Mercer, most companies seem to have a strong awareness of culture and talent issues in M&A situations. Regarding the risk of top talent departing the organization following an M&A transaction, virtually all attendees said they were concerned, with 46 percent saying they were “very concerned.” When queried about the level of prominence of people issues in M&A situations, 64 percent of respondents said that people issues are more prominent today compared to one or more years ago.

“It’s a concern that well considered cultural integration plans and processes are seemingly absent in many organizations planning M&A deals,” said Chuck Moritt, senior partner in Mercer’s M&A consulting business. “While many acquisitive organizations are aware of culture-related risks that surface in transactions, few organizations are doing enough to mitigate those risks ahead of time.”

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Working Across Cultures - Milton Park Event

Do you work at Milton Park or nearby in Oxfordshire?
Do you travel and work abroad for Business?
Do you work with people from different Cultures?
If so we would like to invite you to a free lunchtime event that will be taking place at:


The Advanced Business Solutions Campus - Abingdon and Witney College - 5G Milton Park

Wednesday 16 February from 12.15-13.15:

Title: Working across Cultures - How to Maximise Performance


The international nature and global reach of many businesses requires most of us to interact with colleagues from different cultural backgrounds as part of our jobs.

This informative seminar will address how to;

• Communicate effectively with colleagues from different cultural backgrounds

• Develop effective cross-cultural business relationships

• Successfully manage a multi-cultural team and get the best results from them

• Prepare staff for long-term overseas assignments

• Organise a successful overseas business trip



To find out more about this event and to sign up to attend please go to the following link:

www.expatknowhow.com/talk

We hope to see you there.

 

Chinese Cultural Know-How

As promised here is the 5th and final installment of information on Chinese Cultural know-how for 2010:

Chinese society and culture

Confucianism can be seen as a major influence that permeates the whole of Chinese society. It revolves around the concept of harmonious relationships. This is manifested in an aversion to conflict, maintenance of proper behaviour and the preservation of ‘face’, which roughly translates as ‘honour’, ‘good reputation’ or ‘respect’.
Chinese people value sincerity above all qualities. They admire sincerity, education, respect and frugality.

Confucianism: a Chinese ethical and philosophical system developed from the teachings of the Chinese philosopher Confucius (551–478 BC). In Confucianism, human beings are teachable, improvable and perfectible through personal and communal endeavour especially including self-cultivation and self-creation.

In Chinese names, the surname comes first and the given names second. For instance, the basketball player Yao Ming should be addressed as "Mr. Yao", not "Mr. Ming".

In conversation, avoid controversial topics relating to China’s recent political history. Instead, ask a Chinese person about their culture, art and literature, or the recent economic growth of their nation.

Would you like to know more about Chinese culture or living and working abroad in China?
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Chinese Cultural Know-How

As promised here is the 4th installment of information on Chinese Cultural know-how:


Socialising, eating and drinking:

Hospitality is an integral part of Chinese culture, and an invitation should be seen as a great honour.


• If you eat in a restaurant you should not offer to share the bill, but you will be expected to reciprocate. Tipping is technically illegal in China, and you will not ever be expected to leave anything.

• If you are invited to the home of a Chinese person and you cannot attend, be sure to explain why so that you are not seen as disrespectful.

• Arrive on time and remove your shoes on entering a Chinese home. Bring a small gift, and remember to eat well and compliment the food.

• Never eat the last piece from a serving tray, and wait for your host to start eating before you do. Learn to use chopsticks and try everything you are offered.

Would you like to know more about Chinese culture or living and working abroad in China?

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Chinese Cultural Know-How

As promised here is the 2nd area of information on Chinese Cultural know-how:



Gestures and body language:

• The Chinese are not keen on physical contact, so be sure not to pat or slap a colleague’s back.

• Body posture should always be formal and attentive, as it shows you have self-control.

• When business cards are exchanged, present and receive cards with both hands and take time to read the card you are given. This shows your respect.


Would you like to know more about Chinese culture or living and working abroad in China?

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Managing Global Virtual Teams

Further to my last post on managing virtual teams I found some great information on wikibooks:
http://en.wikibooks.org/wiki/Managing_Groups_and_Teams/How_Do_You_Manage_Global_Virtual_Teams%3F

For bespoke cross-cultural training programs both online and face to face contact us @expatknowhow http://www.expatknowhow.com/menus/main.asp?PN=Contact
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Happy Teams....

Managing Virtual Teams - misunderstandings arising from cultural differences

A new report from the Economist Intelligence Unit, Managing Virtual Teams: taking a more strategic approach, highlights the prevalence of virtual teams and the methods by which they are managed.


The accompanying survey of over 400 executives from around the world found that, while 78% now work, or have worked, in a virtual team, this kind of teamwork has many problems, two of the biggest being misunderstandings arising from cultural differences – a strong argument in favour of cross-cultural training – and the general difficulty of leading people from a distance.
See more of the article @ www.eiu.com/sponsor/NEC/virtualteams

For bespoke cross-cultural training programs both online and face to face contact us @expatknowhow http://www.expatknowhow.com/menus/main.asp?PN=Contact
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Doing Business with the Brits

Doing Business with the Brits


Today, UK businesses are very different from 20 years ago. However, there is still some hierarchy in British firms, with a distinctive difference between the status of Executives and managers, with most executives having secretaries. But contrary to many articles you'll read about the Brits and their working practices, they have become much more egalitarian with flatter organisational structures. And, NO! bowler hats and pinstripe suits are rarely seen.
The British like to work in teams and identify with personal commitment to a group. Individual initiatives are generally taken following a group consensus to proceed. However, there is also a strong feeling of individual accountability for implementation. Most managers aspire to be effective, decisive and above all 'fair'. Fairness in relationships is more important than closeness (the Brits overriding value system lies in the concept of 'fair play').
Meetings start on time and conclude on time. A meeting without a concrete decision or result is seen as a 'waste of time'. Unlike many other cultures, meetings are generally informal in style and begin and end with social conversation. Participants are expected to make a contribution, not necessarily just in their own specialist area. Opinions are encouraged and listened to. Advance papers may not have been read thoroughly before the meeting (unlike the French, German and Finns).
Although English is spoken all over the world, many cultures need an interpreter to understand if the British are saying "Yes". Wanting always to be polite and to have time to think, a standard business response is, "We'll think about it" or "How interesting". Communication is open, somewhat indirect, impersonal and detailed. It can be contradictory; but it should never be personal. Northern Europeans often fail to understand the true meaning of British communication as it is not as direct as theirs.
Humour is frequently used as a defence mechanism, often in the form of self-depreciation or irony and can become quite sarcastic during disagreements or arguments.
Presentations are structured and formal, but usually have an element of humour. Nowadays, an element of entertainment is expected.
Understatement is very common. Brits hate over emphasis (hyperbole), they see it as boastful and pushy. Sometimes Brits appear less enthusiastic than they really are. Don't give British people a 'hard sell' or what they refer to as an 'American sell'. They dislike it, seeing it as manipulative and pushy. They'll walk away. The audience will expect to ask questions at the end.
Best tip for working with the British: beware of the 'stiff upper lip' which gives the British the appearance of formality and detachment, they traditionally use this when faced with difficult situations.


Interesting article recently posted at Sietar UK and written by Dr. Deborah Swallow

Cross-cultural know-how for first time meetings

3 cultural know-how tips about first meetings, that I recently read on linked in........

1. Dress conservatively

You are planning to attend two important networking events: one in Milan, Italy, and another one in Dubai, UAE. How do you think your typical conservative suit would be perceived in these cultures?

In Italy, and particularly in Milan, the capital of fashion, the dress code is not to be overlooked. Style of dress is of the utmost importance, as outward appearance is indicative of inner values. Clothing is considered a reflection of your social standing, family background, education level, and overall level of competence. Therefore, dressing too conservatively or not making the extra effort to follow the current trends may give quite a bad impression.

On the other hand, your knee-length skirt, or tight-fitting trousers may be considered inappropriate in Dubai, where women usually wear loose-fitting dresses and show as little skin as possible. In Arab countries, modesty in dress and behaviour is the basis for respect. Not taking this into account may not only give a bad impression but even cause offence.

2. Greet every one with a firm handshake


The British handshake is a firm, quick shake. The firmness of the handshake is supposed to convey both dynamism and sincerity. It is considered acceptable for women to instigate handshakes with other men and women. But is it the same in Japan or Saudi Arabia for instance?

In Japan, hand shaking can only happen when an older and higher positioned Japanese person offers his hand to a younger person but never the other way round. Besides, handshakes are not supposed to be strong, and they seldom are. Therefore, a senior Japanese may not appreciate you instigating a firm handshake with him and may even feel offended by your obvious lack of respect.

In Saudi Arabia, physical contact between men and women is to be avoided. Be aware that while Saudi men may shake hands with other Western men, some Saudi men will not shake hands with Western women. You should therefore let them initiate the greetings and follow their lead.

3. Smile


British people tend to be quite reserved – there isn't generally an extensive use of gestures or facial expressions in the UK. A British person making a special effort to smile may appear moderately expressive in comparison to other cultures.

In Nigeria, smiling and showing sincere pleasure when meeting a person is important. People tend to be very expressive and more use is made of facial expressions than would be the norm for Northern Europeans. Warmth and friendliness are highly valued qualities. Neutral facial expressions are likely to be interpreted as a lack of interest in the other person.

However, smiling too much may be considered suspicious in Russia. Russian people tend to be rather formal, unsmiling, reserved and poker-faced at first encounters. They tend only to warm up when they are starting to appreciate and trust you.

Successful meetings...................