Daimler-Chrysler Merger: A Cultural Mismatch?
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Case Code : BSTR009
Case Length : 7 Pages
Period : 1998-2001
Organization : Daimler Benz Chrysler Corporation
Pub Date : 2001
Teaching Note : Available
Countries : India, North America, Europe
Industry : Automobile & Automotive
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
Attempts to Bridge the Chasm
DCX took several initiatives to bring the two cultures closer. Press reports indicated that in Stuttgart, the more formal Germans were experimenting with casual dress.
The Germans were also taking classes on cultural awareness. The Americans at DCX were encouraged to make more specific plans, while the Germans were urged to experiment more freely. Analysts felt that there were many indications that the Americans and the Germans might come closer. The Americans were impressed by their German counterparts' skill with the English language (though they tried to cut down on slang to simplify speech when the Germans were in town). To reciprocate, many Americans were taking lessons in German. When the DCX stock began trading on November 17, 1998, German workers celebrated with American-style cheerleaders, a country-western band called The Hillbillies, doughnuts and corn on the cob...
In 2000, there was a management exodus at Chrysler headquarters in Detroit: two successive Chrysler presidents, James Holden (Holden) and Thomas Stallkamp (Stallkamp), both American, were fired.
Holden was fired after only seven months in the position. Stallkamp replaced Holden and was forced to resign after only twelve months as CEO. Unreal as it might seem, two highly regarded Chrysler executives were fired from their CEO positions in the space of 19 months. Zatsche, the newly appointed CEO of Chrysler USA, was a Daimler executive and a close confidant of Schrempp.
He, in turn, appointed Wolfgang Bernhard, another Daimler executive, as
COO. Neither had any real exposure to the US marketplace. This turn of
events demoralized Chrysler's workers. According to an employee, most of
the workers were disgusted and frustrated because they felt they were
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