Exxon Corporation and Mobil Corporation – Coursework – Linda Yao
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Exxon Corporation and Mobil Corporation
Assignment Name: Mergers & Acquisitions Ye Chen 300759254 Zhuqiong Luo 300763968Qiongye Wu 300728915 Yonglin Zhang 300759610College Name: Centennial CollegeCourse Name: Human Resources StrategyCourse Code: HRPD 712Section: 101Instructors Name: Nadira SlnghDate Submitted: November 26, 2014Question 1Identify 2 organizations that tried to merge and failedAmerican company Chrysler and German company Daimler-Benz Identify 2 organizations that achieved a successful mergerExxon Corporation and Mobil CorporationQuestion 2Explain why the two organizations that your team selected failed to mergeOn May 7, 1998, the two automakers, German Daimler-Benz and American Chrysler announced a merger of equals. Due to the cultural clash, internal problems of both sides and the industrial development, the merger turn out to be a failure. The reasons of its failure are listed as follows:Cultural ClashThe chart below shows the cultural difference between the two companies in terms of their company structure, how they value their products and working atmosphereDaimler-BenzChryslerCompany StructureHigh authority; Strong hierarchy;Team-oriented; top down management; lean staffHow they value their productsHigh quality; luxurious; high price Competitive price; attractive appearance Working atmosphereTraditional; formal; rigidRelaxed, informal, risk-taking
These cultural factors resulted in conflicting goals and orders in different departments from the two companies (Kerbes, 2007).Lack of trust between the employeesEmployees from the two companies lack commitment to work with each other. The major reason is that the initial concept of “merger of equals” was far from reality. Many of the key executives from Chrysler were replaced by Daimler counterpart in the initial stage of the merger (Kerbes, 2007).The industrial challengesWhen the Asian automotive player Toyota entered the U.S market, the Chrysler side failed to compete with others in the industry (Kerbes, 2007).Question 3Explain why the two organizations your team selected achieve a successful merger?In 1999, the two oil company, Exxon and Mobil merged together and formed THE ExxonMobil Corporation. This largest merger in history has been a great advantage to both of the companies due to its economies of scales and technological advantages used in optimal drilling and transportation.The two companies have achieved the successful merger through:1. Communication and corporation in terms of technologyThe exchange and corporation of technologies of the two companies has helped ExxonMobil cut down the time used in discovering and extracting oil and gas. It also enabled the organization to explore resources in some areas in very hard conditions (Mohammed, 2013).2. Vertical integration of businessShortly after the merger, the company vertically integrated in businesses which include exploration, drilling, oil and petrochemical refining. Huge profit was generated from the vertical business integration (Mohammed, 2013).
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By: Linda Yao
Submitted: July 22, 2015
Essay Length: 1,968 Words / 8 Pages
Paper type: Coursework Views: 590
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