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    CULTURE AND COMMUNICATIONASSIGNMENT

    NACHIKET MUJUMDAR20130120120

    MUDRA INSTITUTE OF COMMUNICATIONS, AHMEDABAD

    MARCH 9, 2014

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    PART A

    Pick any two acquisitions and demonstrate if they have succeeded or failed. You can use

    financial metrics, but the key is to show how intercultural communication played a role in

    the acquisitions success or failure.

    Prior to its acquisition by Tata Steel in 2006, one of the worlds most geographically diversified steel

    producers, with operations in 26 countries and commercial offices in over 35 countries, Corus was

    Europes second largest steel producer. Tata Steel and Corus merged in 2006. Apart from the financi al

    and business considerations, what made this a successful merger was the focus on intercultural issues and

    communication from both sides. The Tata Steel Group counts unity and understanding as two of its core

    values, part of which consists of respect to colleagues and creating relationships with tolerance and

    mutual cooperation at their core. The Managing Director ensured that he met with the stakeholders, i.e.Corus management as well as employee Union members and kept the discussion channels open. Since

    the two groups would have extremely different cultural outlooks, it was essential to find the optimum way

    to communicate. Corus on its part also undertook concerted efforts for the same. The management

    enlisted a communications consultancy firm to hold a programme whose core aims were as follows:

    To increase understanding of India, particularly Tata Steels locations

    To raise awareness of Indian cultural values and working styles

    To provide advice, tips and practical strategies on how best to develop working relationships with Indian

    counterparts

    Training was also provided to Indian counterparts working in the UK.

    To understand the new bosses better, Corus felt it necessary to learn more about the context and

    background to India, including religion, geography and politics; understanding of underlying attitudes,

    values and behaviours; insights into working practices, structure, hierarchy and etiquette in Indian

    organizations; an initial understanding of Tata Steel and its brand values etc. Tata Steel also had

    experience with working with different cultures throughout its lifetime and always believed in

    understanding the other culture and being open to learning from it, rather than applying its values and

    vision in a generalized form. All these steps before the merger went a long way in ensuring a smooth

    trasition for Corus as it came under Tata. In fact, financial metrics show that profits increased manifold

    since then to 2012. Tata Steel moved from the 56th to the 5th position on the list of steel producers

    globally and its capacity rose almost seven fold to 28 million tonnes per annum.

    Another merger that we can analyse in the same light is the 2007 merger between Indian aluminium giant

    HIndalco and Novelis, the worlds largest producer of rolled aluminium and the largest re-cycler of

    aluminium cans which has 12,500 employees in 11 countries. When Hindalco made this bid in 2007 this

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    became the largest Indian investment in North America and the second-largest overseas investment by an

    Indian company (behind the above mentionedTata Steel Europe's purchase of Corus two weeks earlier)

    to this time.

    When it comes to intercultural issues, Hindalco applies a different approach. The management allows the

    acquired company acquire to run its own policies from before takeover for two to three years before

    implementing Hindalcos own internal policies including human resource management. The idea is to

    give a cool-off time and allow a company like Novelis to understand Hindalcos internal policies before itis fully implemented and integrated.

    This gives a good opportunity and a buffer period in which any intercultural issues can be resolved and

    effective communication channels can be forged.

    Hindalco gives due importance to potential cultural conflicts and understands that cultural integration was

    a key issue and a time consuming process. It integrates these thoughts into its value system itself by

    stating clearly that the multidisciplinary, multi-lingual, multi-cultural workforce should be anchored with

    a sense of ownership at the end of the day and this holds for both the indigenous employees as well as the

    acquired foreign employees.

    Even this merger was successful in business terms. It established Hindalco as a global, integrated

    aluminium producer and benefitted it in terms of downstream businesses, increased capacity and quick

    access to new technologies. Hindalcos stock price rose considerably after falling when the bid was

    announced.

    Many mergers or acquisitions fail if potential intercultural issues are not given due attention. Even in this

    globalised world, cultural differences abound, very pronounced even in case of work and ethics.

    From the analyses above, we can conclude that cultural integration does play a role in deciding the

    success or failure of a merger or acquisition. Although this link cannot be defined quantitatively, the very

    fact that these companies spent considerable resources on holistic cultural integration speaks volumes

    about its importance.

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    PART B

    Bennetts DMIS is the best model to describe an individuals progress in her/his

    intercultural sensitivity. Argue for or against the claim, with specific examples.

    The Developmental Model of Intercultural Sensitivity or DMIS is the model devised by Milton J Bennett

    to provide a framework for studying how different people handle intercultural differences and what

    impacts cross cultural communication between individuals or entities. Bennett derived a scale on which to

    place individuals according to what stage of intercultural sensitivity they have attained. The scale ranges

    between ethnocentrism, where the people experience their culture as central to reality, and

    ethnorelativism, where people accept that their beliefs and cultures are just a part of a large set of viable

    alternatives.

    Why one would call it the best model for analyzing intercultural interactions is because the model clearlydefines six distinct stages so as to cover an extremely wide spectrum of variations in attitudes and

    behaviours. It then allows one to classify the subjects accordingly and use the guidelines of the model to

    bring in effect changes in the same.

    Let us first detail the six stages through examples.

    The first stage, Denial, is the inability to recognize or acknowledge cultural difference. On the surface, a

    person might observe that he never experiences culture shock or he may maintain that as long as his

    language is being used, he has no problem. Denial is of two types- isolation, where the individual doesnt

    construct any other categories to notice or interpret cultural differences; and separation which involvesignoring differences and simply constructing another undifferentiated category apart from the own

    culture. Thus another way a Denial worldview shows up is as an inability and disinterest in differentiating

    national cultures. For example, a lot of Europeans simply club oriental people as Asians and south Asians

    as Pakis.

    The second stage, defense, involves acknowledgement of differences, which is a development from the

    previous stage. However this stage usually involves a negative view of other cultures, while placing ones

    own culture at the apex of cultural evolution. For example, many Indians feel that Western culture is an

    attack on their own values. Thus Defense stage maybe expressed through establishing superiority of ones

    own culture. Another aspect of defense is denigration of other cultures. This may be observed when an

    Indian calls westerners a bad influence or a European refers to Italians as dirty. Thus negative

    stereotyping is a prevalent in this stage. Reversal is another form of defense. This is when another culture

    is seen as superior while maligning ones own. Why reversal falls under this category is due to

    maintenance of strongly dualistic thinking. How it is a development from the previous stage is the fact

    that the undifferentiated categories formed during denial are hardened without proper integration. The

    person saying he has no problem as long as his language is being used would now say, it would be so

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    much better if people from other cultures could talk just the way he does. If reversal is dominant, a person

    might be embarrassed by his culture and wishes to instead become part of the culture he sees as superior.

    The third stage, minimization, occurs when a person tries to avoid conflict or cognitive dissonance by

    believing that differences among cultures can be overridden by the fact that all humans are inherently the

    same. A person in this stage would try to play down differences. This stage shows movement from the

    previous stage, in that it accepts the differences at some level, but instead of accepting it, he relegates it to

    being a minor issue. Instead he focuses on commonalities like physiological similarity or beliefs such askilling being bad. Continuing our example of language, now the individual might say that even though the

    mode and context might differ, the basic idea and need of communication is the same.

    The fourth stage Acceptance, is when there is recognition and appreciation of cultural differences.

    Individuals accept other cultures as viable alternatives for people to exist in. One form is behavioral

    Relativism where the individual is able to analyze complex interaction in culture-contrasting terms.

    Another is Value Relativism where the individual accepts that values, beliefs etc exist in cultural context

    and hence may differ accordingly. As an example, the individuals in this stage may make statements

    about more cultural differences being better for business as diverse people bring different perspectives to

    succeed.

    The fifth stage, Adaptation, is a further evolution towards ethnorelativism. Here the entity learns

    communication skills to be able to interact more effectively. One of the aspects here is empathy, that is to

    continuously shift perspective to adapt and act according to another culture in different situations.

    Pluralism is the other, where different world views are completely internalized and individuals can

    seamlessly shift frames of reference. Thus a person can hold his own values and opinions and also be able

    to behave according to the culture he is interacting with. This may mean he would be able to show traits

    like compassion, aggressiveness or humility depending on whether he is dealing with, say, Asians,

    Americans or the Japanese.

    The sixth stage, Integration, is defined as the internalization of bicultural or multicultural frames of

    reference. Thus the individual is able to evaluate phenomenon through multiple frames of reference, an

    ability known as contextual evaluation. Another aspect is constructive marginality in which one accepts

    his identity as not belonging to one particular culture. A drawback of this is confusion and identity crisis.

    I would like to concur with the statement that DMIS is the best model to explain intercultural sensitivity

    on two premises. One, it helps understand an individuals level of sensitivity and hence suggests ways to

    upgrade to another level through tasks which can mitigate the factors ruling that stage. Secondly, it helps

    organizations to be more successful in their endeavours because if they employ such a model, they can atleast be assured of not hurting cultural sentiments or bringing ideas which through a culture clash set the

    stage for business failure. To explain better, let us take the example of food chains. When multinational

    food giants set up shop in new geographies, they tweak their menus accordingly to be accepted. Similarly

    in case of mergers and acquisitions also, an organization needs to engage with people at advanced stages

    in the model so that they can identify with entities in the new cultures and be able to communicate

    effectively with them to mitigate their concerns and interpret similarities to build successful relationships.