MERGER BETWEEN CHRYSLER CORPORATION & DAIMLER-BENZ.   Term Paper ID:29959 Click to get this paper

Essay Subject: Discusses challenges faced by both automotive companies for a successful merger.... More...

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Paper Abstract: Discusses challenges faced by both automotive companies for a successful merger. Impact on corporate culture. Day-to-day management at the combined organization. Makeup & situation of both companies at the time of the merger. Government subsidies to the automotive industry. Role of competition in the auto industry. What each company has to gain from the merger. Effect on Human Resources (HR). Internal structure. Union culture. Management of multinational organizations. Divesity programs. Paper Introduction: Introduction In early 1998, Chrysler Corporation, one of the three leading American automakers, and Daimler-Benz, one of Germany's largest industrial companies (and a leading European car manufacturer), announced a planned merger. Mergers and acquisitions in the 1990s differed from those during the 1980s in that the emphasis had shifted on building stronger organizations in the latter decade while mergers and acquisitions during the 1980s focused on improving short-term profits for the acquiring company. The merger was, in part, the result of participating in a mature industry where expanding profit margins depended on expanding market share, and where globalization played an increasingly important role. The decision for Chrysler and Daimler-Benz to join forces was generally seen by analysts as a positive move for both com Text of the Paper: The entire text of the paper is shown below. However, the text is somewhat scrambled. We want to give you as much information as we possibly can about our papers and essays, but we cannot give them away for free. In the text below you will find that while disordered, many of the phrases are essentially intact. From this text you will be able to get a solid sense of the writing style, the concepts addressed, and the sources used in the research paper. acquisitions in the s differed from of participating in a mature industry where expandingprofit margins for both companies however merging the suggesting that the transitionwas complete This research examines the merger products to the American military It divestedits Gulfstream p Daimler-Benz on the other hand participated York Stock Exchange and has beensince when Daimler-Benzstruggled with its profit margin which hovered at approximately The merger between Chrysler and Daimler-Benz moved the complemented by a significant European presence and awell-known commitment trucks Its internal organization was also considered highly efficient totheir workers automotive manufacturers also provide a considerable numberof risk of new marketparticipants which may well receive fuel efficient butwhich also meet stringent emission standards California in of cars which are manufactured Electric vehicles for Merger Managing a multinational organization requires or whether a new region can be company can take on the cost andburden sametask Levine p S When multinational enterprises decide that In the case of Chryslerand Daimler-Benz access toChrysler's American markets and distribution system for its gained from Daimler's reputation for craftsmanship andquality The newly merged company was not able to continue to of both and which seeks to minimize the weaknesses the financialperformance of the firm Both themselves Bott p OKRB Chrysler has put include representatives frompurchasing finance manufacturing and suppliers thosedecisions have throughout the organization It is not to be taken into account asthe companies industries Collective bargaining isperformed on behalf of all laborers arenegotiated on a company-by-company basis between management and workcouncils union structure differs from the American system company-by-company basis not across the industry Typically similar Recognizing that the union culture is different in the two its board of directors German law requires that board indicated that the deal was infact a merger rather analysts who believe that the Germanautomotive industry would in any case how much influence the locate new plants an issuewhich is make the company better able to process Just as not every individualis right the right technical skills for theassignment and business trips lasting only a few days mayhave long-term relocating but can also be important if the employee will try tomaintain a standard of living commensurate simply impossible to maintain the samestandard of living to realistic in light of the target country the compensation and the standard of living which theemployee can arrivein the country they are less well-attuned to helping employeesadapt to day-to-day problems such as taxes how families are treated whenan employee is if thespouse has a job in the United States better which decreases the stress that the family as employeesadjust to the cultural changes they will be encountering These Americans learn that Australians donot tip and that the foreign assignment Harrison p The Realities of new name DaimlerChrysler reinforces this idea German managers a fact not lost on otherkey products Nonetheless DaimlerChrysler successfully negotiated both without a strike and by successfully addinga Diversity Programs While the business community as a the ramifications ofthat reality to how it affects the employees directly In of empirical information available to human the successful elements of a up a program thatwill be an outside trainer p it maybe more prudent and would allow it to establish certain guidelines fordiversity training difficult challenges that companies must due to the perceived backlash that members faced that diverse refers to womenand as well as diversityamong cultures a particularly challenging company's greatest assets Ifthe organization failure and a continued drop in productivity and morale Conclusion being able to bring out the strengths whileeliminating or at most successfulmergers are fraught with difficulty and of doing business and these came to the forefront With the departure ofEaton the company has taken program is critical to helping thecompany develop that while Daimler'sfalls Knight-Ridder Tribune Business Focus p Grosse R Kujawa D International Business LineInvestment Survey p Levine M April Leaders figure out puzzle marketers tolearn more than a new Selecting a diversity trainer HRMagazine industrial companies and a leading acquisitions during the s focused onimproving short-term profits for the decision for Chrysler andDaimler-Benz to join forces was generally early the former head of Chrysler who had Merger In addition to manufacturing automobiles and in received more than percent of its revenues and Thecompany was also a significant participant in the Airbus States but not throughoutthe rest of for the five years leading tothe merger increased at an fifth-largest automotive manufacturer with combined sales of billion Daimler-Benz was not the dominantmanufacturer and a global presence to subsidize nationalautomotive manufacturers because of the significant role that such as China also open up additionalmarket competingproducts as well and with more differentiation among them the world the regulations in that ofemissions but also because they are quieter to operate and must determine whether it is more cost effective to enter a company which is determining how toadd company can use the expertise of anotherorganization which be necessary Some companies use a licensing arrangement to the two organizations was the access to Daimler-Benz's Europeandistribution and entrance into more beneficialto Chrysler than to Daimler-Benz Brennan p OKRB Instead the company must shape a new build quality cars Chrysler's internal efficiencyshould be taught two countries where the companiesare based but also the was able to decrease its development cycles by morethan order tomake design decisions and can considerations such as these particularlywhen viewed membership in Germany is strictly voluntary and there is companies mayor may not apply the terms other in-house practices and arecomposed of and typically the one which negotiates contracts at the BigThree on the financial position of thecompany in the success of theindustry the new company had a had labor representatives and managementrepresentatives The fact that the United similar actions attheir own companies On negotiate a contract which takes into accounttheir current situation Bott have to yield to the recommendations of thesupervisory board on generally considered tohave made the company Expatriate Daimler-Chrysler will shortly discover what other multinationalorganizations Miller p This means that potential employees must beconsidered on the challenges that a long-termassignment represents These skills may want tointerview the spouse of the employee this is primary concern to both the expatriate and tothe company a policy can also be carefully put together compensationpackages which take into account the inconvenience more difficult to scale back anoverly generous compensation be important in helping employees adapt to their new business overseas has become increasingly greater block to employee productivity in long-term assignments However such a forthe entire family on adapting to critical factor for success Harrison p Some companies the office environment and in societyas a business interaction can help themfeel more comfortable merger Chrysler employees are of the opinion that they were leaving the organization At this point the feeling threatened as they seemany of the tone of negotiations in the bonuses which were previously not part of their compensationpackages international workplacewhich characterizes today's business environment there is no diversity trainers who come to the job site and added to the staff and diversity is information available isanecdotal with the result that human trying to develop a diversity program there is an important new role for thehuman the training of the overall organization Thiswould enable the company training regardless of whether they are located in Germany theUnited ignored by participants after initialtraining but difficulty determining which employees should be covered by the diverse companies set out to develop diversity programs they that the strengths which brought the twocompanies together recognize the contributions of both cultures from some of the characteristics of the other The art product lines of the two companies do notreally compete in the samecountry There are significant new company mustbring together two distinct corporate cultures team andinternational workforce a new get seat onDaimlerChrysler board Knight-Ridder Tribune Business News p PR Newswire p DEM Derderian S Jewett D April The Transition is Poor's StockReports p McNerney D J June Global staffing Chrysler to better designs Design News pp Introduction In early Chrysler Corporation one of the three leading those during the sin that the emphasis had shifted on depended on expanding market share and where two corporate cultures wasexpected to present challenges to the impact on corporateculture and day-to-day management at the combined Aerospace a manufacturer of corporate not only in the automotiveindustry but it agreed to use Generally Accepted Accounting Procedures GAAP which percent The company posted losses in and and had a company intothe top-tier of world to craftsmanship Chrysler on the other hand had Evolution of the Industry Individual ancillary jobs and require additional services subsidies from the government in orderto compete The next particular has strong guidelines for control of example may provide a serious alternative to gasoline-poweredvehicles These would that companies takeinto account differences in the regions in enteredbest by forming a partnership with another company of introducing new products on their a partnership offers themost benefits they determined that the mutual benefits were so high-endvehicles and adds light trucks and mid-range cars to while Daimler can benefit from Chrysler's efficiency within itsorganization do businesseither the traditional Chrysler of both If Daimler is renown for craftsmanship then of these tasks must also take considerable effort into improving its internalstructure with its cross-functional design in addition to engineers The result is that immediately clearthat such a structure could be implemented struggle to create their own and all companies who are federationmembers apply the not the union These work councils have the legal where each tradehas a union In the automotive industry contracts arenegotiated with all companies within the countries and also recognizing that companies have a percent representation of than an acquisition and could signal a shift amongAmerican like to move away from industry negotiations andtoward the American United AutoWorkers' representative has had on of particular interest to the American union representative blend the cultures of two vastlydifferent for every job not every but also because they are flexible enough to consequences which should not be dismissed be gonefrom home for an extended period with the home country for theexpatriate and many analysts agree which the employee is accustomed in Once thecompensation package has been established expect should be carefully explained to employees who may bemoving likely to be unpleasantly surprised aboutworking conditions living conditions compensation and logistics ofcommunicating with the home office However so-called relocated In some cases the family will travel or if there are children awhole faces and improves the employee's productivity Family classescan include rudimentary language instruction and also information English cars have bonnets not hoods Helping employeeslearn the the Merger Although the combination of and in early both Thomas executives several of whom also announced career changes thefirst labor contract with the year to the contract's length whole recognizes that diversity is away of the workforce One way to solve this someorganizations diversity trainers are consultants resourceprofessionals faced with developing a diversity program can be asignificant diversity program without strongresearch to support their decisions This worth the time and expense to have internal DaimlerChrysler staff that would enable all employees overcome whenimplementing a diversity program is making as a result of thetraining Another barrier minorities there is a growing situation DaimlerChrylser must avoid a program which simply simply tries to impose one culture Any merger brings together organizations least minimizing the weaknesses What this one was no exception Mergers as the new companytried to build a on a distinctly German culture but corporate culture References Bott J May News p OKRB B Chrysler Corporation announces digital Chicago Irwin Harrison J K of brandmanagement Advertising Age pp S S Levy language Marketing News pp Minahan T May Platform p Woodyard M January Eaton European car manufacturer announced a planned merger Mergers and acquiring company The merger was inpart the result seen by analysts as a positivemove served as co-chairman ofDaimlerChrylser announced his retirement light trucks Chrysleralso sold defense-related percent of its profits from its automotive sales Levy consortium Daimler-Benz was listed on the New the world In the years leading up to the merger average annual rate of only one percent Joseph p had a strong reputation in luxury cars andcommercial trucks in mid-range cars and light suchcompanies play in the economy Aside from providing direct employment opportunities but also introduce the There isincreased emphasis on building cars that are not only state can havean impact on the types do not rely onfossil fuels directly Analysis of a newregion by simply going in directly new products to its product line A has already laid the groundwork to accomplish the enter markets or introducenew products others enter into joint ventures most effectivestrategy In this way the German auto manufacturer gained the luxury vehicle and heavy truck market Chrysler also B The Merger and Its Effect on Human Resources culture for itself which builds onthe strengths to Daimler employees in order to sharpen internal cultures of the companies percent by forming teams which immediately see the effect that from the inside as successful need asingle union for all workers in major Secondary issues such as shifts both management and labor Grosse Kujawa This manufacturers These contracts are negotiated on a question at the time the contract is negotiated representative of the United Auto Workerson Auto Workers was successful athaving a member on the supervisory the other hand there are some p OKRB It is not clear issues such as where to aware of issues which confront the American worker and should have learned through experience successful expatriateoperations begin with the selection not only because they possess are important regardless of how longthe assignment will last important when the spouse isalso which is funding his activities Some companies harmfulto the employee since it is of being away from home but which are also package once the employee has accepted it The structure of livingenvironment If employees have realistic expectations before they common in recentyears and some companies have become and long-term successwith the organization Such issues include consequence can cause upheaval in the household particularly their new home Such an approach can helpthe family adjust use specialized training classes to help whole It is in such classes that more quickly and thus help them improve theirproductivity during they weresimply acquired by Daimler-Benz The company's corporateculture would be shaped by the productivity gains made by Chrysler lost to the labor-intensiveDaimler United States for the other majormanufacturers and did so an innovation introduced by Daimler management Woodyard p clear-cutagreement as to how to communicate that reality or communicateboth what diversity is and dealt with onan ongoing basis Rogers p The lack resource managers are left trying topull together is littleempirical research which can help guide them in setting resource department Diversity Program Development While Rogers suggests using to tailor a training program to meet its uniquerequirements States or a third nation One of the most there are also cases where there was a long-term negativeeffect label There is general agreement must confront diversity in their own culture continue to be the joint the result will be long-term of thesuccessful merger is in against each other However even the differences between the German and Americanways which while influenced bytheir country cultures can be quite different corporate culture is necessary for long-termsuccess and a diversity training OKRB Brennan M May Chrysler's stock rises April International success lies in cross-cultural training HR over AutomotiveIndustries p Joseph C M June DaimlerChrysler Value HR Focus pp Miller C March Going overseas requires S S Rogers B October Americanautomakers and Daimler-Benz one of Germany's largest building stronger organizations in thelatter decade while mergers and globalizationplayed an increasingly important role The the combined management team In organization The Two Companies at the Time of the jets in the early s and also in aerospace defense product and space systems were used commonly in the United net profitmargin of only percent in Sales auto manufacturers The combined company was theworld's astrong presence in the American market although it governments are likely to continue which support entireother industries New markets decade may well see an increase in the number of emissions since it is one of thesingle largest markets in be attractive not only because of the lack which they operate In doingso they which is alreadysuccessful The same issues confront own and offering the marketingsupport for this or a they also recognize that some compromise will diverseand so great that a merger of its product offerings Chrysler on the other hand gained In general however the merger was seen as way or the traditional Daimler way quality should be passed on toChrysler in order to into accountthe cultural differences not only of the process introduced in the late s The company the teams have all of the input they need in at Daimler-Benz after themerger but it is clear that new culture Minahan p S Union terms negotiated to their workers Other standing tocodetermine worker safety procedures and the United Auto Workers is thelargest union automobile industry but there canbe some concessions worked out depending labor is a critical element in labor on their supervisory boards theDaimlerChrysler board manufacturers Ford and General Motors to take way of negotiating This would give individualcompanies the opportunity to the direction of the combined company German corporations do not However having input from the American union is organizations Jewett p Managing the employee is right for expatriate work adapt to a foreignwork environment and willing to take McNerney p In the case of long-term assignments companies of time Compensation is also a that over-compensation can be a problemfor companies Derderian p Such all countries Because of this companies must upward modifications can bemade if necessary However it is much overseas Setting realistic expectations of the living situationcan or other factors affecting theirdaily lives Miller p Doing soft issues maypose an even with theemployee this is most often the case Some companies help spouses find work overseas and provide classes acceptance ofthe assignment is a ondifferences in cultures both within tools of day-to-day social and Chrysler and Daimler-Benz was originallyto have been a Stallkamp presidentof Chrysler and Robert Eaton Co-chairman of DaimlerChrysler announcedthat Jewett p American employees are increasingly UAW in the lead company generally setsthe In addition line workers receive profitsharing life in the workplace particularly in the problem is throughthe use of while in otherorganizations they are issue for many companies Much of the is the underlying problem thatmanagers face when that the company will put into theproject Nonetheless diversity training members trained indiversity responsible for to receive the samequality of sure that it will work Somediversity programs are simply to establishing an effective diversity program is thatthere is emphasis on the aging work force aswell When multinational forces one cultureonto the other and recognize on the other or doesnot which believe that each canbenefit made this mergerdifferent from many is that the can be difficult when the companies involved are based new corporate culture In addition the thecompany has recognized that with its international management Auto workers union likely to manufacturing application thatfurther reduces manufacturing lead times May September Developing successful expatriatemanagers Human Resource Planning pp E May Chrysler Corp Standard teams pair with suppliers todrive is leaving Automotive News p acquisitions in the s differed from of participating in a mature industry where expandingprofit margins for both companies however merging the suggesting that the transitionwas complete This research examines the merger products to the American military It divestedits Gulfstream p Daimler-Benz on the other hand participated York Stock Exchange and has beensince when Daimler-Benzstruggled with its profit margin which hovered at approximately The merger between Chrysler and Daimler-Benz moved the complemented by a significant European presence and awell-known commitment trucks Its internal organization was also considered highly efficient totheir workers automotive manufacturers also provide a considerable numberof risk of new marketparticipants which may well receive fuel efficient butwhich also meet stringent emission standards California in of cars which are manufactured Electric vehicles for Merger Managing a multinational organization requires or whether a new region can be company can take on the cost andburden sametask Levine p S When multinational enterprises decide that In the case of Chryslerand Daimler-Benz access toChrysler's American markets and distribution system for its gained from Daimler's reputation for craftsmanship andquality The newly merged company was not able to continue to of both and which seeks to minimize the weaknesses the financialperformance of the firm Both themselves Bott p OKRB Chrysler has put include representatives frompurchasing finance manufacturing and suppliers thosedecisions have throughout the organization It is not to be taken into account asthe companies industries Collective bargaining isperformed on behalf of all laborers arenegotiated on a company-by-company basis between management and workcouncils union structure differs from the American system company-by-company basis not across the industry Typically similar Recognizing that the union culture is different in the two its board of directors German law requires that board indicated that the deal was infact a merger rather analysts who believe that the Germanautomotive industry would in any case how much influence the locate new plants an issuewhich is make the company better able to process Just as not every individualis right the right technical skills for theassignment and business trips lasting only a few days mayhave long-term relocating but can also be important if the employee will try tomaintain a standard of living commensurate simply impossible to maintain the samestandard of living to realistic in light of the target country the compensation and the standard of living which theemployee can arrivein the country they are less well-attuned to helping employeesadapt to day-to-day problems such as taxes how families are treated whenan employee is if thespouse has a job in the United States better which decreases the stress that the family as employeesadjust to the cultural changes they will be encountering These Americans learn that Australians donot tip and that the foreign assignment Harrison p The Realities of new name DaimlerChrysler reinforces this idea German managers a fact not lost on otherkey products Nonetheless DaimlerChrysler successfully negotiated both without a strike and by successfully addinga Diversity Programs While the business community as a the ramifications ofthat reality to how it affects the employees directly In of empirical information available to human the successful elements of a up a program thatwill be an outside trainer p it maybe more prudent and would allow it to establish certain guidelines fordiversity training difficult challenges that companies must due to the perceived backlash that members faced that diverse refers to womenand as well as diversityamong cultures a particularly challenging company's greatest assets Ifthe organization failure and a continued drop in productivity and morale Conclusion being able to bring out the strengths whileeliminating or at most successfulmergers are fraught with difficulty and of doing business and these came to the forefront With the departure ofEaton the company has taken program is critical to helping thecompany develop that while Daimler'sfalls Knight-Ridder Tribune Business Focus p Grosse R Kujawa D International Business LineInvestment Survey p Levine M April Leaders figure out puzzle marketers tolearn more than a new Selecting a diversity trainer HRMagazine industrial companies and a leading acquisitions during the s focused onimproving short-term profits for the decision for Chrysler andDaimler-Benz to join forces was generally early the former head of Chrysler who had Merger In addition to manufacturing automobiles and in received more than percent of its revenues and Thecompany was also a significant participant in the Airbus States but not throughoutthe rest of for the five years leading tothe merger increased at an fifth-largest automotive manufacturer with combined sales of billion Daimler-Benz was not the dominantmanufacturer and a global presence to subsidize nationalautomotive manufacturers because of the significant role that such as China also open up additionalmarket competingproducts as well and with more differentiation among them the world the regulations in that ofemissions but also because they are quieter to operate and must determine whether it is more cost effective to enter a company which is determining how toadd company can use the expertise of anotherorganization which be necessary Some companies use a licensing arrangement to the two organizations was the access to Daimler-Benz's Europeandistribution and entrance into more beneficialto Chrysler than to Daimler-Benz Brennan p OKRB Instead the company must shape a new build quality cars Chrysler's internal efficiencyshould be taught two countries where the companiesare based but also the was able to decrease its development cycles by morethan order tomake design decisions and can considerations such as these particularlywhen viewed membership in Germany is strictly voluntary and there is companies mayor may not apply the terms other in-house practices and arecomposed of and typically the one which negotiates contracts at the BigThree on the financial position of thecompany in the success of theindustry the new company had a had labor representatives and managementrepresentatives The fact that the United similar actions attheir own companies On negotiate a contract which takes into accounttheir current situation Bott have to yield to the recommendations of thesupervisory board on generally considered tohave made the company Expatriate Daimler-Chrysler will shortly discover what other multinationalorganizations Miller p This means that potential employees must beconsidered on the challenges that a long-termassignment represents These skills may want tointerview the spouse of the employee this is primary concern to both the expatriate and tothe company a policy can also be carefully put together compensationpackages which take into account the inconvenience more difficult to scale back anoverly generous compensation be important in helping employees adapt to their new business overseas has become increasingly greater block to employee productivity in long-term assignments However such a forthe entire family on adapting to critical factor for success Harrison p Some companies the office environment and in societyas a business interaction can help themfeel more comfortable merger Chrysler employees are of the opinion that they were leaving the organization At this point the feeling threatened as they seemany of the tone of negotiations in the bonuses which were previously not part of their compensationpackages international workplacewhich characterizes today's business environment there is no diversity trainers who come to the job site and added to the staff and diversity is information available isanecdotal with the result that human trying to develop a diversity program there is an important new role for thehuman the training of the overall organization Thiswould enable the company training regardless of whether they are located in Germany theUnited ignored by participants after initialtraining but difficulty determining which employees should be covered by the diverse companies set out to develop diversity programs they that the strengths which brought the twocompanies together recognize the contributions of both cultures from some of the characteristics of the other The art product lines of the two companies do notreally compete in the samecountry There are significant new company mustbring together two distinct corporate cultures team andinternational workforce a new get seat onDaimlerChrysler board Knight-Ridder Tribune Business News p PR Newswire p DEM Derderian S Jewett D April The Transition is Poor's StockReports p McNerney D J June Global staffing Chrysler to better designs Design News pp If this paper is not what you are looking for, you can search again: Search for: or Click here to request an essay written just for you.