Cultural Integration at Daimler-Chrysler*

            


Details

Case Code : CLBS044
Publication date : 2004
Subject : Business Strategy
Industry : Automobile
Length : 03 Pages
Price : Rs. 50

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Key words:

Daimler-Benz, Chrysler Corporation, Jurgen Schrempp, Robert Eaton, pay disparities, centralized decision-making, non-hierarchical style, consensus managers, empowerment


* This caselet is intended for use only in class discussions.
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Abstract: ICMR India ICMR India ICMR India ICMR India RSS Feed

The caselet discusses the culture that existed in the two automobile companies, Chrysler Corporation and Daimler-Benz prior to their merger. The caselet analyses that the traits that were pre-dominant in these two organizations, and how they were different from each other. The caselet looks into the issues that developed at the merged organization due to the cultural mismatch between the two organizations.

Issues:

 » The need to assess the culture of the organizations planning to merge.
 » The role of organization culture in making a merger successful.
 » Predominant culture traits found in an American organization and a German organization.

Introduction

In May, 1998, Daimler-Benz and Chrysler Corporation, two of the world’s leading car manufacturers, agreed to combine their businesses in what they claimed to be a “merger of equals.” The merger resulted in a large automobile company, ranked third in the world in terms of revenues, market capitalization and earnings, and fifth in the number of units (passenger-cars and commercial vehicles combined) sold.


DCX generated revenues of $155.3 billion and sold 4 million cars and trucks in 1998. Schrempp and Eaton jointly led the merged entity, as co-chairmen and co-CEOs...

Questions for Discussion:

1. Daimler-Benz and Chrysler Corporation, two of the world’s leading car manufacturers, merged. Describe briefly, the culture of Daimler-Benz?

2. “DCX’s success depended on integrating two starkly different corporate cultures.” In which ways were the culture of the companies different from each other?