Cultural Impact on CROSS BORDER Renault-Nissan alliance
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7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
http://slidepdf.com/reader/full/cultural-impact-on-cross-border-renault-nissan-alliance 1/17
Managing the culturalissues of merger andacquisitionThe Renault - Nissan
case
Presented by:
Kuldeep Singh 000853425Nakrit Sisookkham 000847913Usman Al Amodi 000870400Shelina ho!ani 00088298"#ohammed Suhail 000882429#ohammed $ahoo% 0008"8794
7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
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Criticism all around
&'' t(o mules don)t make a ra*e horse+ - CEO Chrysler
&'', A marriage o% desperation %or !oth parties+- Business Week
7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
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Nissan before alliance
- $e*ession in .apan in earl/ 90)s
- 20 !illion in de!t
- here (as *ompla*en*/ and la*k o% urgen*/ in
*ulture
- esign o% *ars (as out o% tou*h (ith the market
- A high degree o% !ureau*ra*/
- here (as an emphasis on engineering *ulture than
managerial *ulture than promotions
7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
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Renault before alliance
- #ain sour*e o% reenue %rom small and medium sie
*ars in urope
- a*k o% presen*e in international market
- 856 sales %rom (estern urope
- imited produ*t line
- poor st/ling and poor produ*t ualit/
- imited produ*t line
7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
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Nissans Struggle- o*us n :rodu*tion $ather han ;ustomers
- <eak :rodu*t :ort%olio and la*k o% sense o% urgen*/
=apanese #anagement
- Keiretsu s/stem > *ross?shareholding
- mplo/ee adan*ement !ased on time spent in*ompan/
- $isk aoiding attitude o% management,
7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
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=apanese ;ultural @ssues
- ;onsensus de*ision making
- @n%ormal meetings
- :romotion %or the most
kno(ledgea!le and eperien*e
- inger pointing rather than
a**eptan*e
7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
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Major Cultural Differences and challenges between
Renault and Nissan
Main cultural differences between the Japanese and theFrench cultures based on the Hofstede center website
7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
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Major Cultural Differences and challenges between
Renault and Nissan
Individualism s Collectivism1 Nissan Renault
The group as the most efficient
instrument, decisions are taken by
consensus
more individualistic culture
- :romotions !ased on results and o!.e*ties a*hieementB this *hange in
Nissan aims to in*rease indiidualism in a (a/ that %a*ilitates %inding ne(
talents,
- @ndiiduals (ere empo(ered in de*ision making pro*ess- he ne( management s/stem in Nissan no( en*ourages indiidual
initiaties and adan*ements in *ontrar/ to the %ormer s/stem
7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
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Major Cultural Differences and challenges between
Renault and Nissan
Nissan Renault
Strong, lower than Renault, hierar*h/ is
strong,
<hat determines the hierar*h/ is thetime spent in the *ompan/,
;ommandment o% managers !/
someone /ounger (as %or!idden
Strong hierar*h/
- Ne( s/stem o% promotion that is !ased on per%orman*e (as
implemented,
- o minimie the high risks o% *on%li*ts ;arlos Chosn had esta!lished a
dou!le hierar*h/ s/stem,
!ower Distance2
7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
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Major Cultural Differences and challenges between
Renault and Nissan
Nissan Renault
Higher masculinity within society ren*h *ulture tends to support
eualit/ !et(een males and %emales
- $enault is sending (omen managers to Nissan as part o% their *olla!oration
Masculinit" s Femininit"3
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Major Cultural Differences and challenges between
Renault and Nissan
Nissan Renault
*/*li*al per*eption o% time#ore long term oriented
linear per*eption o% timeB ime ismone/
#ore short term oriented
- ime orientation in Nissan had to !e *hangedB ;arlos Chosn set the surial
plan to make Nissan a!le to re*oer as soon as possi!le !/ %o*us on
regaining short term pro%it
#ime !erception4
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Major Cultural Differences and challenges between
Renault and Nissan
Nissan Renault
#aking de*isions take mu*h longer
time
!e*ause general *onsensus
he/ make de*isions ui*kl/
- Num!er o% NissanDs !oard mem!ers redu*ed %rom 37 !e%ore the allian*e (ith
$enault to 10
Decision$ma%ing5
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Major Cultural Differences and challenges between
Renault and Nissan
Nissan Renault
mplo/ees are er/ lo/al !e*ause o%
the *on*ept o% li%etime emplo/ment
mplo/ees are !e less lo/al !e*ause
o% the indiidualisti* *ulture
- ;arlos Chosn eliminates this prin*iple &li%etime emplo/ment+ mentioning that
=apanese *annot stu*k (ith this old prin*ipleB and the/ had to adapt to
*urrent management s/stems in order to keep their po(er%ul in the auto
industr/
&nterprise 'o"alt"6
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Solution to Nissan’s cultural issues
- ;s E;ross %un*tional teamsF
- :romote the indiidual a**ording to their per%orman*e
- eelop a short?term orientation (ithin Nissan organisation
- ;reate a strong %amil/ atmosphere (ith more so*ial a*tiities
- #ake the organisation %latter to speed up the de*ision making pro*ess
- Use other methods su*h as anti*ipated retirement instead o% la/o%%
- $edu*e Nissan keiretsu s/stemB less suppliers and su!?*ontra*torsB Use
the international *ompetition among suppliers to sae mone/
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Solution to Nissan’s cultural issues
7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance
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#he success of Renault$Nissan strategic alliance
#he strategic alliance between Renault and Nissan has created a successful
giant car producer in the global (uto Industr" mar%et) ran%ed No* +
,*- million cars of sales in ./0+) about 0/1 of cars manufactured all over the
world) e2pectation for ./03 is to sell 0/ million cars
Combining the best practices coming from the two companies
Constant s"nerg" between the two companies and common goal vision
(fter 0- "ears of the alliance) the two companies still see%ing more
convergence 4strategic alliance is a constant process of re$shaping and good
practicing 5