Concept 9.

2 Strategic alliances and business cultures

To develop strategies for the global market, companies are turning to alliances.
Strategic alliances can create considerable advantages. First, they can help realise
increased economies of scale and reduced marketing costs. Furthermore, they can
result in access to new markets, know-how and technology. Moreover, if the alliance
is a close one, a takeover or merger, risks can be shared and products developed
jointly. Th rough carefully managed co-operation, the results of rapprochement
between companies can be seen relatively quickly. Not that everything is necessarily
plain sailing: extra problems may well arise – especially those relating to culture.
Merging cultures

On the strategic level, Delavallée (2002) uses the work of Cartwright and Cooper (1993) to
explain the strategies used during company mergers. According to them, there is not just
one merger strategy but four: assimilation, deculturalisation, separation and integration. Th
e type of merger strategy used depends on:
● how strong the buyer’s infl uence is on the culture of the company being absorbed; and
● the degree to which the company to be absorbed is bound to its own culture.

Compatibility between cultures is rarely taken into account while the merger process is
under way. When the two sides are highly incompatible – a discovery oft en made months
later when people actually start working together – the shock can be overwhelming.
Culture shock

Marx (1999) insists on the fact that the culture shock phase is an integral part of the
adaptation phase and, as such, should have no negative connotations. Th is is a normal
reaction of people who confront the strange, the unknown, the foreign, but who have no
indication of future success.
Cross-cultural adaptation

Kim (2005: 377) refers to the lack of coherence in the work of diff erent researchers in
this domain who not only use various terms – for example, acculturation, adjustment
or assimilation (Spotlight 9.2) – but also use divergent perspectives to describe the
phenomenon. According to her, the literature on cross-cultural adaptation misses ‘a
systemic insight into what happens when someone crosses cultural boundaries’.