International Business Environment - Essay Example

However, it is reported that there have been shallow analyses of the causes of failure in merger and the measures of success are often weak (Epstein, 2005). With this information, there must be substantial reasons to be used in order for merger to be justified as a failure and the right manner to be considered in its evaluation. This means that the determination of successful or failure merger considers the right evaluation and reasons in order to determine reliability of information involved in the issue.

Evaluating the success or failure of mergers is not an easy task. For instance, the newly merged companies might be well good to look from the outside but in reality there is more to it when it comes to knowing the real event happening inside. It might be very important to find out if the newly merged employees from Africa and China have been doing just fine together or the other way around. They may look like enjoying their work but it is important to finally know what is inside of them. This is a very complex scenario and this requires a highly skilled in-charge who will consider all aspects in an organization where there is diversity of people who will be working for the good of the entire operation.

This is a great concern in this paper and the proponent wants to give more emphasis on the importance of understanding man power involved because this stands as the company’s ultimate force for the implementation of its corporate agenda. The proponent believes that people are the ultimate ways in which an organization may either prosper or fail. It is in line with this that the entire idea is placed on a proposed merger between a Chinese company and an African company. The proponent is appointed to lead a team consisting of managers from both countries to examine any cultural problems linked to the proposed merger.

Thus, the proponent solves this concern by applying the work of Hofstede and Trompenaars in order to evaluate how close would the cultural fit be; and how might find a way to improve cultural understanding between the two groups of managers. However, prior to this, the proponent discusses about some important issues about mergers and the corporate culture in Africa and China. Why Mergers Fail? There is a common assumption that mergers are for the purpose of cutting costs, creating revenues or ensuring growth opportunities.

However, one of the concrete reasons why mergers fail is due to issue of control and ownership. It is not easy to carry an organization which is a product of integration between two or more companies because there will be a new level of control and ownership involved. In this case, there are different considerations involved particularly on emphasizing who is the one in-charge or owns the newly integrated companies. In short, there is a significant issue on who will be the one to control the merger.

Mergers are not just implemented without a great or significant reason. Two companies need some integration due to the fact that it may result to creating more values than staying apart from each other otherwise. Such of this reason can be manifested by understanding different sensible motives for mergers. The first motive is to ensure more strength and knowledge in a specific industry by having horizontal mergers. Most of this type happens between banks or companies at the same business line.

The second motive is about