Examining a Business Failure

Examining A Business Failure

Chrysler LLC

Examining A Business Failure

Chrysler LLC

In 1998 Daimler-Benz paid $37 billion for Chrysler LLC, changing the name to Daimler-Chrysler. In 2007 Daimler then sold Chrysler for $7.4 billion to Cerberus Capital Management.

Partnerships, of any form be such as mergers, acquisitions or joint ventures, are a viable strategic option to achieve the objectives of growth, diversification, economics of scale, synergy or a global presence The typical reason for failure was the partnership was based only on financial and economic information or what is more commonly called "hard " data and rarely involved data to support the meshing of the organizational cultures or the "soft" and "mushy" issues (Badrtalei & Bates, 2007) The cultural compatibility was the big failure of this merger. Daimler-Chrysler failed to understand the organizational culture, which involves organizational environments, and differences between national cultures.

The most often cited reason for the failures is the total lack of understanding between the two parties of the culture, personalities, nationality and technological systems. In a matter of two years, all the top American executives have either retired, left, or were fired, and were replaced by German employees. The morale among the American employees was at its lowest, causing anxiety and low productivity. There was not partnership of equals in the combination of domestic and international corporate. One member of the partnership will be dominant based on financially or market position. Both parties come to the partnership table with difference perceptions and contributions to the merge (Badrtalei & Bates, 2007). All these factors have generated a poor job satisfaction, which is the core of subsequences turnover, absenteeism, deviant workplace and organizational citizenship behavior. These Organizational Behaviors can be explained using different variables of how individual...