Cultural Impact on CROSS BORDER Renault-Nissan alliance

7/21/2019 Cultural Impact on CROSS BORDER Renault-Nissan alliance

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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



Criticism all around

&'' t(o mules don)t make a ra*e horse+ - CEO Chrysler

&'', A marriage o% desperation %or !oth parties+- Business Week



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



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



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,



=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



Major Cultural Differences and challenges between

Renault and Nissan

Main cultural differences between the Japanese and theFrench cultures based on the Hofstede center website




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




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




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




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




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




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



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/



Solution to Nissan’s cultural issues



#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



6uestions

hank Gou

Cultural Impact on CROSS BORDER Renault-Nissan alliance

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