Abstract

With direct foreign investment estimated at US$ 1.4 trillion, organizations are finding themselves involved in cross-border mergers and/or acquisitions. While this global trend seems to stand out in the business landscape, it is not without problems. Studies have shown that more than 50% of M&A do not lead to expected outcomes. While many reasons have been cited for the less than stellar performance, culture, both organizational and societal, has often been underestimated as a contributing factor to the situation. Acculturation, or the change (s) which takes place when two diverse groups come together, has been the focus of much scholarly research in both sociology and business. Nahavandi and Malekzadeh (1988) use the model of acculturation to describe the interactions in mergers and acquisitions. We propose a framework which takes their theoretical work a step further by combining the dynamic processes of realization, symbolization, interpretation, and manifestation proposed by Hatch (1993) in the Cultural Dynamics Model to describe the continuous development of organizational culture. The framework also considers the implication of societal culture in the acculturation process. The Acculturation in Cross-Border Acquisitions framework expands the definition of acculturation to include the dynamic processes of organizational culture, and attempts to provide a deeper understanding of the process of acculturation.