C u l t u r a l P e r s p e c t i v e

Presented by:

Sarang Gaikwad

Vishal Vyas

Yogendra Singh

Rifat Ahmed

Surabhi Singh

E S S C ABUDAPEST SUMMER PROGRAM 2010

About the Companies

Royal Biscuit Company

Edeling GmBH

Introduction to the Case

Issues faced

Analysis

Clash of Cultures: Organizational Differences

Leadership Styles

Acculturation Strategy

Pre Merger Recommendations

Bibliography

Royal Biscuit Company

10 year old London based food company

Industry Power house

Transformed snack food industry

CEO: Sir John Callaghan

Edeling GmbH

120 year old Munich based company

Family owned

Beloved German brand and model employer

CEO: Heinz Burkhardt

England’s Royal Biscuit Company andGermany’s Edeling GmbH are in the finalstages of a merger. Will a global cultureclash cause the deal to crumble?

www2.syngenta.com/en/downloads/syngenta_oil_wasser_03_05_2004.pdf

http://hbr.org/2004/05/oil-and-wasser/ar/1

Challenges faced by CEO of Royal Biscuit Co. to

collaborate the framework and organizational structure of

the new merging company.

Merger of equals;

Create synergy between two former competitors to form

the world’s second largest food company

The New Merging company to have:

Headquarters: London

CEO: Sir John Callaghan

Non Executive chairman: Heinz Burkhardt

Board Members: 7 out of 10 from Great Britain

Management and Supervisory Board

Formation of guiding principles

Whose best practices should be abandoned?

Leadership

Appointment of New Leaders

Leadership development Program

“We” and “them” attitude.

Employee Retention

German and British employee perspective

Time pressure by Investors and Stockholders

Clearance from both the govt.

Hofstede’s Dimensions Germany Great Britain

Power Distance 35 35

Individualism 67 89

Uncertainty Avoidance 65 35

Masculinity 66 66

Long Term Orientation 31 25

National Culture

Both have low PDI

Indicates their care for equality and opportunity

Reflects initiative of “merger of equals”

Individualism:

Germans- Value group success through collective

cooperation

British- Value individual success through competition

Uncertainity Avoidance

Germans- More rule-oriented

British- Less risk aversed

Long Term Orientation

Germans- Focus on long term Paybacks

British- Focus on short term results

Royal Biscuit Co.

Corporate Structure

Short History

Modern

Decentralized

Empowered employee

Task Oriented

Edeling GmbH

Family Owned

Long History

Traditional

Centralized

Team Work

Formal procedures

and regulations

Royal Biscuit Co.

Consider it as an art

Cultural fit and emotional intelligence place high

importance

Energetic and dynamic leadership

Edeling GmbH

Consider it as a Science

High academic achievement and outstanding

recommendations

Training before joining

Integration – Royal Biscuit Company

Multinational Company

Motive to expand in different locations

Modern and Flexible

Separation – Edeling GmbH

Very Rigid

Long and proven work culture as perceived by

Germans

Traditional ways of doing things

“We” and “them” attitude should be replaced by

“Us”.

Group of managers should’ve been appointed

from both the company

New strategy following the common guiding

principles

It shouldn’t be merger of equals, i.e., one has to

be the acquirer.

Headquarters should be at a Neutral location

Flow of information and communication between

the two merging companies.

(2004, May 03). Retrieved May 20, 2010, from www2.syngenta.com:

www2.syngenta.com/en/downloads/syngenta_oil_wasser_03_05_20

04.pdf

Creating a Global Business Composed of Two Culturally Different

Business. (2009, June 17). Retrieved May 22, 2010, from

http://predicate.wordpress.com:

http://predicate.wordpress.com/2009/06/17/creating-a-global-

business-composed-of-two-culturally-different-business/

(n.d.). Retrieved May 22, 2010, from http://www.aubg.bg:

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GZZ050%2Fstrategic%2F633002648699062500.ppt&rct=j&q=oil+an

d+wasser+case+study+analysis&ei=Fu_7S4z8GNL3Oceige4B&usg

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