Westjet's Acquisition in Mexico

Acquisition is one of the penetration methods that Westjet can consider using to go into Mexican industry. For example, Westjet can expand to Mexican market by purchasing a Mexican local airline company. However, as the stated in Schneider and Barsoux’s article (2002), many management techniques come from specific historical and social contexts. In other words, Westjet may encounter management problems if they continue to practice Canadian management style on the newly acquired Mexican airline. According to Schneider and Barsoux’s article (2002), Mexico is ranked by Hofstede as a country with high power distance and low individualism; compared with Canada, which is ranked as highly individualistic and have low power distance. Therefore, Mexican companies will tend to have more level of hierarchy, and a more centralized decision-making than Canadian companies. Canadian managers may argue that it is perfectly normal to contact anyone in the organization in order to complete a task; while that may seem intolerable to Mexican managers. Also, Mexican companies follow “political system”, in which they believe in that managers play important role in the society, and thus it is more essential for managers to obtain power than achieving specific objectives (Schneider & Barsoux, 2002). On the other hand, Canadian managers tend to reject the need for political maneuvering.

Although acquisition helps Westjet to penetrate Mexican industry more easily due to its existing client base and its connection to local market and government, it can be very costly for Westjet to maintain the balance between Canadian management styles and Mexican management styles. As a company that is extremely proud of its organizational culture, Westjet might find it difficult to accept that its acquired company in Mexico because their drastic culture differences. Westjet is known for its ability to create positive and empowered workplaces. The wonderful organizational culture had Westjet named the...