Investigating Business and National Culture during Due-Diligence and Its Impact on Multi-National Ventures

By Herbert Nold and Allan Hagelthorn.

Published by Organizational Cultures: An International Journal

Format Price
Article: Print $US10.00
Published Online: April 29, 2016 $US5.00

The world of business is changing and organizations are finding that cross-border partnerships, mergers, and alliances are very different from similar domestic ventures. The influence of national culture can be dramatic and leaders are discovering that those differences can have a great impact on the success or failure of the partnership. The success of a business relationship depends on many classical factors such as financial risk, legal liabilities, and capability to deliver. Participants in this study demonstrated that few of the sample organizations understand the other organizations business or national culture and the inability to understand significantly increases commitment of money and resources without improving chances of success. The purpose of this study was to gain insight into the shortcomings of crossnational venture effectiveness by exploring the relationships and effects of business and national culture in ventures and the efforts expended during due diligence to identify potential problems. Study results indicate that many of the problems organizations face could have been discovered early and allowed for the establishment of programs necessary to address cultural issues before they become organizational problems, but little proactive action is taken.

Keywords: National Culture, Mergers, Acquisition, Partnerships, Due Diligence

Organizational Cultures: An International Journal, Volume 16, Issue 2, June 2016, pp.1-19. Article: Print (Spiral Bound). Published Online: April 29, 2016 (Article: Electronic (PDF File; 1.003MB)).

Dr. Herbert Nold

Professor of Business Administration, School of Business and Applied Science, Polk State College, Lakeland, Florida, USA

Dr. Allan Hagelthorn

Principal, Operations, MeLange Global Solutions, Spokane, Washington, USA