Cultural Differences as Barriers to Success

The Merger & Acquisition team hired a team of external consultants to assist with identification of cultural issues which could result in barriers to the successful acquisition of Island Banking Services by Padgett-Beale. The consultants conducted interviews with Padgett-Beale executives and senior staff. They also used a standardized survey to measure attitudes and beliefs about culture and conflict management styles at Padgett-Beale. A survey of islanders was conducted as well. The results from both surveys have not yet been validated but, the early results show substantial similarities to existing national culture survey results for U.S. populations and residents of Fiji. You can learn more about the national culture surveys here: https://www.hofstede-insights.com/models/national-culture/ and here https://www.hofstede-insights.com/country-comparison/fiji,the-usa/

An additional survey was conducted among Padgett-Beale managers who will transfer to PBI-FS and island residents who have applied for jobs at PBI-FS. This survey focused primarily on the influence of context upon inter-cultural communications. This survey found that Padgett-Beale’s corporate communications culture was “low context” while the job applicants expected a “high context” culture. For definitions and examples see http://www.culture-at-work.com/highlow.html

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After reviewing the consultants’ reports, the M&A team has decided to focus on differences in two factors which could present immediate barriers to success: (a) communications context and (b) power-distance.

Cultural Dimension Padgett Beale Managers & Employees PBI-FS Job Applicants (Islanders)
Communications Context Low Context High Context
Power-Distance Medium Power Distance High Power Distance

To answer questions and allay concerns, you’ve been asked to prepare a briefing about these factors to be given at the next senior leadership meeting. For that briefing you must research and answer the following questions:

1. What is “communications context” and how could it influence expectations of managers and employees and their relationships with each other at PBI-FS?

2. What is “power-distance” and how could it influence expectations of managers and employees and their relationships with each other at PBI-FS?

3. How might differences in communications context (low/high) and power-distance contribute to conflicts within the new organization (PBI-FS), e.g. between transferred PBI personnel and newly hired islanders?

4. What best practices should managers and executives follow when conflicts arise between the company (Padgett-Beale) and its new subsidiary (PBI-FS)?

Organize your talking points around the four sets of questions. Then write your responses as a 5 to 7 paragraph briefing paper (you may use some bullet points but the majority of the content should be organized as paragraphs). This paper will be sent to the VP’s and other senior leaders to read prior to the senior leadership meeting.

Post your briefing paper as a reply to this topic. Remember to cite your sources and include your reference list at the end of your posting.

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