Cross Cultural Management Group

Cross Cultural Management Group Case Study Introduction This report will evaluate the situation that occurred between the telecom companies Telia (Sweden) and Telenor (Norway). The two countries had plans to merge to gain a competitive advantage in their region of North Europe and also to begin competing on an international level. The benefits of this merger at first look, outweigh any apparent problems or disadvantages, however as we will learn Culture plays a big role in our lives and that doesn’t by any means exclude the business world. Analysis Both these countries share many basic similarities in Culture as it has been traditionally defined. Their languages are similar they have the same preferences in risk avoidance, power distance, individualism and many other factors. Both countries are considered to have very feminine characteristics, which in previous theory would lead one to assume that Negotiations would be easier than if it were two masculine cultures or a mix of the two. We must now realize how important historical events when it comes to the forming of a culture, especially when it relates to bias and resentment held against another country. The not so distant history of the two countries and the ways they interacted in the past (big brother – little brother), were only mirrored throughout the whole negotiation process, whether intentional or unintentional. This is in our opinion the main cause for the falling out between the two companies. The fact that government factors were involved would have also intensified these feelings as both parties had to take into consideration the national position in this dealing. It is safe for us to state that Culture, and how cultures interact, can not only be look at by breaking down their preferences and tolerances. History and situations which have occurred between certain countries must also be considered strongly (more so when history between the two is recent). Let us take an example of the USA and Russia, they have had many conflicting ideas throughout history and are very different in the traditional context of culture, and their differences are only negatively affected by Wars fought (The Cold War). Sweden Throughout the history of the Nordic and Baltic region Sweden has been the super power, although they somewhat had good intentions with Norway when they acquired the territory from Denmark. They tried to be as autonomous with the Norwegians and allow them freedom. Basically they wanted to act as their overseers (Big Brother). This had a negative effect on the people of Norway, this is understandable, why would they have to feel like they need to be taken care of, or guided. In order for them to feel fully fulfilled as a people they need to be free of any ties regardless of how much freedom their “owners” are with them. Norway So Norway was somewhat resentful towards the Swedes and their desire to control them, this in turn has given them a strong sense of Nationalism as Rosengren so insensitively joked (fair enough he didn’t know he was on camera). For the Norwegians it is clear that they are proud that now they are their own people and any return to a situation of being controlled in any framework, especially by the Swedes would have to be ill received. The Negotiation The Negotiation Started well, as it was clear it was a win- win situation, and the CEOs of both companies were friends and had a good idea of what and why they wanted to do what they did. This negotiation had been initiated originally and later declined it took secret meeting to get it back on track. This in future could have caused a lot of mistrust between parties especially since the two original secret negotiators were not present throughout the whole process. There are a few instances that we can look at that would relate directly to the history and cultural “mistrust” that is apparent between these two countries. The sizes of the companies The ration in size of the companies share was to be 60/40 for Telia and Telenor respectively this mirrors the advantage of power that the Swedish held in the past The Headquarters The head quarters situation was clearly a childish affair and just a last grasp of glory much like a little brother fighting over a toy with his older sibling. As mentioned in the case this is a very easy situation to find a solution to when thinking in a reasonable state and there are not so many EMOTIONAL and FEMININE factors at stake. The Publicity Slip by Rosengren In a time when the dealings were already falling apart, this member of the Swedish “contingency”, made the comment that would have just confirmed what all the Norway’s assumed about their counterparts, that would have been the final draw I am sure. There are many other details which caused this snowball effect Conclusion In conclusion the Overbearing nature of Sweden when it comes to Norway, in addition to the resentment that Norway feels toward Sweden for their past colonial state, is the reason for this merger falling apart. Both parties meant well and were looking for advantages, but the Swedes weren’t sensitive enough to the Norwegians feelings and maybe the Norwegians were overly sensitive, that is a subject for debate. However this case shows us the impact that history can have when talking about cultural issues.

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