Daimler

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DaimlerChrysler: The Quest to Create “One Company”
Case Analysis

AMBA 650
Professor Bensimon
February 12, 2013

In 1998, the Daimler Benz and Chrysler companies decided to merge together in an effort to capitalize on each other positioning in their respective markets. This merger would join together Germans and American to create synergy to dominate the world automotive market. In theory, this was a brilliant idea to bring together the best engineers and auto stylists in the world. However, differences in culture which was thought to be a minor barrier turned out to be a major underlying factor behind the failure of DaimlerChrysler. Separate cultural ideals on business practices, communications and management destroyed this endeavor. In this case analysis, we will evaluate and understand how cultural differences, organizational structure, management styles, integration strategy and stakeholders played a role in this failure.
The cultures of these two companies were totally different; Daimler Benz was aggressive and believed in gaining every advantage possible to be the top automotive company in the world. Chrysler was a firm that was non-aggressive and progressed slowly. They believed that they gained most of their success from production and operations flexibility. In addition to this, the procedures for compensation and decision-making cause severe friction between top level managers of the newly merged DaimlerChrysler. At lower levels, employees bickered about items such as working hours, dress code and smoking while working. Language barriers definitely became a major point of emphasis between the two different factions of the new company. Chrysler veterans had almost no ability to speak or write in German. Meanwhile, Daimler managers could speak some English but not at a level consistent enough to forge new business relationships with…...

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