Mass Merger - the Case of Aon Singapore

Topics: Culture, Cross-cultural communication, Geert Hofstede Pages: 6 (1973 words) Published: December 11, 2010

Our case study deals with Mass Merger. Since the 90s, together with the globalization of business, Mergers and Acquisitions have developed at an incredible pace. Thus, companies from all over the world can be lead to work together as one single corporation. Moreover, the world has become interdependent not only economically, but also culturally, that is to say one culture may influence another one or different cultures can be mixed. It is then obvious that intercultural issues have to be solved. In this case, we are going to talk about the Aon Singapore Merger process. The Aon group is an American insurance services holding company. In the 90s, Aon acquired several insurance brokerage firms and entered an unprecedented merger process. Indeed, the group decided to get all the companies they acquired to operate together under the Aon name, in Singapore. That is why they had to face and manage intercultural issues. What are these intercultural issues in our case?

At First, in the Aon merger process, they had to work out different ways of becoming one company. At this stage, cultural misunderstandings can already take place. Indeed, each of the merging companies had its own way of doing everything. For instance, how they hired staff to how they processed a claim. What’s more, they used different computer systems. Hence, misunderstandings occurred between the way people work and think. Thus, Aon had to either take into account these things, to make the merger process as acceptable as possible, or try to transmit a totally new way of doing things and take the risk of dissatisfying the employees. Then, they had to make information as clear as possible. This is a communication issue. The way people communicate can be different from one company to another. The way people understand orders or advice can be different between companies. One of Aon’s main objectives was to create a common communication system to avoid misunderstandings. Generally, in merger processes, people are unsatisfied at the beginning, because they have to change or adapt their way of working, doing things or even thinking. And this makes a deep part of their corporate and everyday life culture. It is not easy to give up a cultural way of doing things for another one. Moreover, people from one merging company can have wrong and groundless judgments about people from another merging company. This is cultural bias. Cultural bias is an only to natural reaction in intercultural situations. In a situation of intercultural interaction we cannot rely on our cultural patterns and therefore feel insecure and uncomfortable. In our case study, we can appreciate that Cultural Bias is present in most of the relationships between top managers and employees or only between employees. The Merger Committee had to decide how to work in Singapore, and of course, each of the merging companies had its own way of doing things, this being a sign of ethnocentrism. Each company would have wanted to introduce its own method, but they had to see things from another point of view, and that is, to select what is best for Aon. Referring to employees, when they attended the official launch event, some of them only stayed with their friends and did not have the chance to meet their new colleagues from the other companies. Maybe it was because they thought that their customs are better than the other ones, a clear sign of ethnocentrism. About stereotypes, the only thing that we can appreciate is how Chinese people work. The note below the case says that since Richard Tan took a position at Aon Singapore and that they use their Chinese given names to differentiate, maybe we can call it auto-stereotypes , it’s also a bit of ethnocentrism in this way. In her report to management, Dr. Anne Marie Francesco refers to four main employee concerns such as communication, motivation, new corporate culture and teamwork. Values of employees could be found out by...

Bibliography: Intercultural Management Course Reader by Barbara Cucka, Winter Term 2009
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