Cultural differences and capability transfer in cross-border acquisitions: the mediating roles of capability complementarity, absorptive capacity, and social integration

This paper presents an integrative model of the impact of cultural differences on capability transfer in cross-border acquisitions. We propose that cultural differences affect the post-acquisition capability transfer through their impact on social integration, potential absorptive capacity, and capability complementarity. Two dynamic variables – the use of social integration mechanisms, and the degree of operational integration of the acquired unit – are proposed to moderate the effects of cultural differences on social integration and potential absorptive capacity. The implications for acquisition research and practice are discussed.

The international match: Metaphors as vehicles of social identity building in cross-border mergers

This article focuses on cultural identity-building in the cross-border merger context. To provide an alternative to the dominant essentialist analyses of cultures and cultural differences, cultural identitybuilding is conceptualized as a metaphoric process. The focus is on two processes inherent in the cross-border merger context: construction of images of Us and Them and construction of images of a Common Future. Based on an analysis of a special metaphor exercise carried out in a recent Finnish–Swedish merger, the article illustrates how the metaphoric perspective reveals specific cognitive, emotional and political aspects of cultural identity-building that easily remain ‘hidden’ in the case of more traditional approaches.

Global capitalism meets national spirit: Discourses in media texts on a cross-border acquisition

In this article, the authors explore media coverage of a recent acquisition across national borders. Their starting point is that the media represent a key arena of “discursive strategizing” for actors such as corporate managers. They illustrate and specify how global capitalism, as discourse relying on economic and financial rationale and exemplified here by the acquiring firm’s attempts to expand, meets national spirit, exemplified here by the complexity in selling the acquisition target to foreigners. The main contribution of this study lies in identifying how key actors draw on and mobilize rationalistic and nationalistic discourses in public discussion. The analysis illustrates that the same actors can draw on different—even contradictory—discourses at different points in time. Furthermore, different actors—even with opposing objectives—may draw on the same discourse in legitimizing their positions and pursuing specific ends.

Gender and National Identity Constructions in the Cross-Border Merger Context

In this article we explore ways in which vertical gender inequality is accomplished in discourse in the context of a recent chain of cross-border mergers and acquisitions that resulted in the formation of a multinational Nordic company. We analyse social interactions of ‘doing’ gender in interviews with male senior executives from Denmark, Finland and Sweden. We argue that their explanations for the absence of women in the top echelons of the company serve to distance vertical gender inequality. The main contribution of the article is an analysis of how national identities are discursively (re)constructed in such distancing. New insights are offered to studying gender in multinationals with a cross-cultural team of researchers. Our study sheds light on how gender intersects with nationality in shaping the multinational organization and the identities of male executives in globalizing business.

Cross-Border Competence Management in Emerging Markets: Voices from China and Russia

This book is on cross-border competence management in Russia and China. Corporations are facing a number of problems and challenges in their international operations, to which there typically are no simple solutions. For instance, they need to understand and respond to cultural and institutional diversity and ascertain that their foreign units are integrated with the rest of the corporation. Throughout this report we will discuss a range of challenges confronting firms as they seek to develop their capabilities to operate internationally. Some of the challenges are clearly case specific, and although this book aims to offer research-based advice to practicing managers there is a potential danger in applying lessons from other companies to the own firm. Our hope is that our analyses of the challenges facing Finnish corporations in China and Russia reported together with extensive quotes from our interviews and insights from other recent studies will help readers draw their own conclusions as to how to deal with issues related to competence management across borders. With this book we also aspire to contribute to the academic literature by providing new insights into cross-border competence management in general and the operations of Finnish corporations in Russia and China in particular.

On the Narrative Construction of Multinational Corporations: An Antenarrative Analysis of Legitimation and Resistance in a Cross-Border Merger

Although extant research has highlighted the role of discourse in the cultural construction of organizations, there is a need to elucidate the use of narratives as central discursive resources in unfolding organizational change. Hence, the objective of this article is to develop a new kind of antenarrative approach for the cultural analysis of organizational change. We use merging multinational corporations (MNCs) as a case in point. Our empirical analysis focuses on a revelatory case: the financial services group Nordea, which was built by combining Swedish, Finnish, Danish, and Norwegian corporations. We distinguish three types of antenarrative that provided alternatives for making sense of the merger: globalist, nationalist, and regionalist (Nordic) antenarratives. We focus on how these antenarratives were mobilized in intentional organizational storytelling to legitimate or resist change: globalist storytelling as a means to legitimate the merger and to create MNC identity, nationalist storytelling to relegitimate national identities and interests, Nordic storytelling to create regional identity, and the critical use of the globalist storytelling to challenge the Nordic identity. We conclude that organizational storytelling is characterized by polyphonic, stylistic, chronotopic, and architectonic dialogisms and by a dynamic between centering and decentering forces. This paper contributes to discourse-cultural studies of organizations by explaining how narrative constructions of identities and interests are used to legitimate or resist change. Furthermore, this analysis elucidates the dialogical dynamics of organizational storytelling and thereby opens up new avenues for the cultural analysis of organizations.

Meän tapa puhua : Tornionlaakso pellolaisnuorten subjektiivisena paikkana ja murrealueena

This folk linguistic and human geographic study deals with dialect awareness, dialect use and place attachment. The study discusses theoretical and methodological issues current in sociolinguistics suggesting that the study of attitudes should be regarded as a core area in the study of variation and change. Furthermore, it is suggested that instead of putting effort into improving mental mapping methodology (adopted into folk linguistics from behavioural geography of the 1960 s), the more up-to-date thinking of space in geography should be adopted. The region and the dialect are treated as perceptual constructs in the study. The dialect perceptions of high school seniors in the Finnish Tornio Valley are examined trough a triangulation method involving a questionnaire, interviews and dialect recognition test as the research methods. The h in non-initial syllables (e.g. lähethä(ä)n, saunhaan ~ sauhnaan let s go into sauna ) turns out, expectedly, as the most salient feature in the dialect awareness of the locals and in terms of local identity construction. This feature is no longer heard in most of the present dialects of Finnish but is still thriving in the Tornio Valley in the cross-border dialect area. The metathetic variant (saunhaan > sauhnaan into sauna , käymhään > käyhmään to go ) is a characteristic feature of the Tornio Valley dialect. However, individual differences have long been found in the use of the h. This study challenges the essentialist variationist view of social categories (gender) by analysing variation from a quantitative but emic and human geographic point of view. The study shows that the variation of the h is statistically significantly patterned in terms of the degree of feeling of insideness vs. outsideness. New light is shed on the gender differences found in earlier sociolinguistic studies: differences in dialect use between and inside gender groups are illuminated by the fact that, in this case, it is young women who are generally less attached to the local community than young men, but this does not hold for all the individuals. The ideological motivation for preservation of the h seems to be based on the imagined community of Tornio Valley covering both the Swedish and the Finnish valley area. The general image of the dialect area and it s speakers, the shared cognitive dialect boundaries of the locals and the particularly deep level of awaress of the linguistic variation of the h are notable resources of the Tornio valley identity. Hyperdialectic forms analogical to the most frequently attested metathetic forms are found in the interview data, predicting that in this dialect the h will be maintained also in the future.

Integration or disintegration? Human resource implications of a common corporate language decision in a crossborder merger

The primary purpose of introducing a common corporate language in crossborder mergers is to integrate two previously separate organizations and facilitate communication. However, the present case study of a cross-border merger between two Nordic banks shows that the common corporate language decision may have disintegrating effects, particularly at organizational levels below top management. We identify such effects on performance appraisal, language training and management development, career paths, promotion and key personnel. Our findings show that top management needs to work through the consequences of the language decision upon those who are expected to make such a decision work.

Cultural differences and postmerger problems: Misconceptions and cognitive simplifications.

Researchers and practitioners have increasingly explained post-merger organizational problems with cultural differences, especially in the context of cross-border mergers and acquisitions. It is suggested here that cultural differences have great explanatory power in the context of post-merger change processes. There are, however, problems with a number of superficial cultural conceptions that are common in research in this area and in managerial rhetoric. This critical article provocatively delineates misconceptions widely held by researchers and practitioners in this field, which not only disregard cultural differentiation, fragmentation, inconsistencies and ambiguities, but further, illustrate a lack of understanding of cultural permeability and embeddedness in the environment, an overemphasis on abstract values and lack of attention to organizational practices, an overemphasis on initial structural differences and lack of attention to the new cultural layer, a lack of recognition of the political dimensions and a failure to recognize cultural differences as sources of value and learning. In this article, the theoretical problems associated with these misconceptions are examined and new conceptual perspectives suggested. The risks at stake for decision makers are also discussed.

Intraday Dynamics of International Equity Markets

The increased availability of high frequency data sets have led to important new insights in understanding of financial markets. The use of high frequency data is interesting and persuasive, since it can reveal new information that cannot be seen in lower data aggregation. This dissertation explores some of the many important issues connected with the use, analysis and application of high frequency data. These include the effects of intraday seasonal, the behaviour of time varying volatility, the information content of various market data, and the issue of inter market linkages utilizing high frequency 5 minute observations from major European and the U.S stock indices, namely DAX30 of Germany, CAC40 of France, SMI of Switzerland, FTSE100 of the UK and SP500 of the U.S. The first essay in the dissertation shows that there are remarkable similarities in the intraday behaviour of conditional volatility across European equity markets. Moreover, the U.S macroeconomic news announcements have significant cross border effect on both, European equity returns and volatilities. The second essay reports substantial intraday return and volatility linkages across European stock indices of the UK and Germany. This relationship appears virtually unchanged by the presence or absence of the U.S stock market. However, the return correlation among the U.K and German markets rises significantly following the U.S stock market opening, which could largely be described as a contemporaneous effect. The third essay sheds light on market microstructure issues in which traders and market makers learn from watching market data, and it is this learning process that leads to price adjustments. This study concludes that trading volume plays an important role in explaining international return and volatility transmissions. The examination concerning asymmetry reveals that the impact of the positive volume changes is larger on foreign stock market volatility than the negative changes. The fourth and the final essay documents number of regularities in the pattern of intraday return volatility, trading volume and bid-ask spreads. This study also reports a contemporaneous and positive relationship between the intraday return volatility, bid ask spread and unexpected trading volume. These results verify the role of trading volume and bid ask quotes as proxies for information arrival in producing contemporaneous and subsequent intraday return volatility. Moreover, asymmetric effect of trading volume on conditional volatility is also confirmed. Overall, this dissertation explores the role of information in explaining the intraday return and volatility dynamics in international stock markets. The process through which the information is incorporated in stock prices is central to all information-based models. The intraday data facilitates the investigation that how information gets incorporated into security prices as a result of the trading behavior of informed and uninformed traders. Thus high frequency data appears critical in enhancing our understanding of intraday behavior of various stock markets’ variables as it has important implications for market participants, regulators and academic researchers.

Knowledge Transfer within Western Multinationals' Subsidiary Units in China and Finland - The Impact of Headquarter Control Mechanisms, Subsidiary Location and Social Capital (summary section only)

It is suggested that the ability and practices of how the multinational corporation (MNC) manages knowledge transfer among its geographically dispersed subsidiary units are crucial for the building and development of firm competitive advantage. However, cross-border transfer of valuable organizational knowledge is likely to be problematic and laborious, especially within diversified and differentiated MNCs. Using data collected from 164 western multinational companies’ subsidiary units located in China and Finland, this study aims to investigate cross-border knowledge transfer within the MNC. It explores a number of factors that influence the transfer of knowledge among units in the differentiated MNC. The study consists of five individual papers. Paper 1 investigates a range of organizational mechanisms that may positively influence a subsidiary’s propensity to undertake knowledge transfers to other parts of the corporation. Paper 2 explores the impact of subsidiary location on the motivational dispositions of knowledge receiving units to value and accept knowledge from subsidiaries located in economically less advanced countries. Paper 3 examines the influence of social capital variables on knowledge transfer in dyadic relationships between foreign-owned subsidiaries and their sister and patent units. Paper 4 provides some initial insights into potentially different effects of trust and shared vision in intra-organizational vs. inter-organizational relationships. Using a case study setting, Paper 5 explores means and mechanisms used in transferring human resource management practices to Western MNCs’ business units in China from a cultural perspective. The results of the study show that MNC management through choices regarding organizational controls can encourage and enhance corporate-internal knowledge transfer. It also finds evidence that more knowledge is transferred from subsidiaries located in an industrialized country (e.g., Finland) than subsidiaries located in a developing country (e.g., China). While the study has highlighted the importance of social capital in promoting knowledge transfer, it has also uncovered some new findings that the effect of trust and shared vision may be contingent upon different contexts. Finally, in Paper 5, a number of mechanisms used in transferring selected HRM practices and competences to the Chinese business units have been identified. The findings suggest that cultural differences should be taken into consideration in the choice and use of different transfer mechanisms.

The Impact of the EMU on International Portfolio Investments

This paper analyses the impact of the launch of the European Monetary Union (EMU) on the allocation of international portfolio investments. The initiation of the EMU provides an opportunity for comparison of competing theoretical explanations for investment behavior. Models stressing the diversification motive would predict that the increased dependence between countries participating in the EMU should reduce the attractiveness of portfolio holdings in other EMU countries. Models based on asymmetric information would instead emphasize the increased intensity in the flow of information resulting from an increase in cross border transactions between the EMU countries. The consequent decline in information asymmetry should increase, rather than reduce portfolio holdings in other EMU countries. Our results based on the allocation of Finnish foreign portfolio investment support the information-based explanation against predictions based on the diversification motive.

Governmental rationalities and the local dimension of European politics. A study of the Interreg IV programme "Alpenrhein-Bodensee-Hochrhein"

The thesis aims at investigating the local dimension of the EU cohesion policy through the utilization of an alternative approach, which aims at the analysis of discourse and structures of power. The concrete case under analysis is the Interreg IV programme “Alpenrhein-Bodensee-Hochrhein”, which is conducted in the border region between Germany, Switzerland, Austria and the principality of Liechtenstein. The main research question is stated as such: What governmental rationalities can be found at work in the field of EU cross-border cooperation programmes? How is directive action and cooperation envisioned? How coherent are the different rationalities, which are found at work? The theoretical framework is based on a Foucaultian understanding of power and discourse and utilizes the notion of governmentalities as a way to de-stabilize the understanding of directive action and in order to highlight the dispersed and heterogeneous nature of governmental activity. The approach is situated within the general field of research on the European Union connected to basic conceptualisations such as the nature of power, the role of discourse and modes of subjectification. An approach termed “analytics of government”, based on the work of researchers like Mitchell Dean is introduced as the basic framework for the analysis. Four dimensions (visiblities, subjectivities, techniques/practices, problematisations) are presented as a set of tools with which governmental regimes of practices can be analysed. The empirical part of the thesis starts out with a discussion of the general framework of the European Union's cohesion policy and places the Interreg IV Alpenrhein-Bodensee-Hochrhein programme in this general context. The main analysis is based on eleven interviews which were conducted with different individuals, participating in the programme on different levels. The selection of interview partners aimed at maximising heterogeneity through including individuals from all parts of the programme region, obtaining different functions within the programme. The analysis reveals interesting aspects pertaining to the implementation and routine aspects of work within initiatives conducted under the heading of the EU cohesion policy. The central aspects of an Interreg IV Alpenrhein-Bodensee-Hochrhein – governmentality are sketched out. This includes a positive perception of the work atmosphere, administrative/professional characterisation of the selves and a de-politicization of the programme. Characteristic is the experience of tensions by interview partners and the use of discoursive strategies to resolve them. Negative perceptions play an important role for the specific governmental rationality. The thesis contributes to a better understanding of the local dimension of the European Union cohesion policy and questions established ways of thinking about governmental activity. It provides an insight into the working of power mechanisms in the constitution of fields of discourse and points out matters of practical importance as well as subsequent research questions.

Ale jaskkot eatnigiella : Alkuperäiskansaliikkeen ja saamen kielen merkitys saamelaisten identiteetille

This study examines the Sámi people and the construction of the Sámi identity and the role of language in the cross-border Sámi movement within the context of the international indigenous movement and discourse between 1962 and 2008. The Sámi movement began as a reaction to state assimilation policies. This led to the birth of indigenous processes strengthening the Sámi cultures and languages. Activities across borders and the ethnopolitical processes in each of the Nordic countries in question also formed the basis of the internationalization of the Sámi people. The discourse on indigenous peoples has grown into a question of human rights, which is examined in different national and international contexts. The study is based on ethnographic data that has been collected via interviews, questionnaires and participant observation with the researched people in different meetings and events. Archive and newsprint material are also used. The approach of the study is auto-ethnographic. The post-colonial theories used in the study strive to destabilize power relations and the distinctions of otherness produced by colonialism, and to reclaim both one's own culture and language in the context of the indigenous movement. A standard model for this type of approach was created by Edward W. Said in his 1978 work Orientalism. The central concepts of the analysis are decolonization, otherness, ethnicity and identity. The dissertation consists of four published articles and an introduction. The subject matter is analyzed on three levels: global, European and Nordic. On the global level, the results demonstrate that the indigenous movement has constructed a new understanding of indigenousness with new rights. International treaties have facilitated the unification of new concepts and rights, such as the right to self-determination and language, also helping in transforming them into rights of the Sámi people on a national level. On the Nordic level, aligning the Sámi culture with indigenous discourse became significant for the process of developing the Sámi identity in the Sámi movement. In this process, the Sámi movement made use of Sámi languages in order to mobilize groups of people and to construct relatedness between different Sámi groups. The realization that one s own language is significant to one's culture has resulted in recreating the vitality, visibility and the legitimation of language in society more generally. The migration of the Sámi people from their traditional territories to increasingly multi-ethnic urban areas alters one's relationship to one's own community as the relationship to cultural traditions changes. Among the urban Sámi, who form a group of ‘new Sáminess’, linguistic discrimination and assimilation continue because of the lack of legislative and other effective language policy measures to promote the learning and use of the Sámi language.

Trust, participation and health among ageing people : A cross-sectional cohort study of men and women born in 1926-30, 1936-40, and 1946-50 in the Lahti region, southern Finland

The purpose of the present study was to explore the associations between good self-rated health and economic and social factors in different regions among ageing people in the Päijät-Häme region in southern Finland. The data of this study were collected in 2002 as part of the research and development project Ikihyvä 2002 2012 (Good Ageing in Lahti region GOAL project). The baseline data set consisted of 2,815 participants born in 1926 30, 1936 40, and 1946 50. The response rate was 66 %. According to the previous studies, trust in other people and social participation as the main aspects of social capital are associated with self-rated health. In addition, socioeconomic position (SEP) and self-rated health are associated, but all SEP indicators do not have identical associations with health. However, there is a lack of knowledge of the health associations and regional differences with these factors, especially among ageing people. Regarding these questions, the present study gives new information. According to the results of this study, self-perceived adequacy of income was significantly associated with good self-rated health, especially in the urban areas. Similar associations were found in the rural areas, though education was also considered an important factor. Adequacy of income was an even stronger predictor of good health than the actual income. Women had better self-rated health than men only in the urban areas. The youngest respondents had quite equally better self-rated health than the others. Social participation and access to help when needed were associated with good self-rated health, especially in the urban area and the sparsely populated rural areas. The result was comparable in the rural population centres. The correlation of trust with self-rated health was significant in the urban area. High social capital was associated with good self-rated health in the urban area. The association was quite similar in the other areas, though it was statistically insignificant. High social capital consisted of co-existent high social participation and high trust. The association of traditionalism (low participation and high trust) with self-rated health was also substantial in the urban area. The associations of self-rated health with low social capital (low participation and low trust) and the miniaturisation of community (high participation and low trust) were less significant. From the forms of single participation, going to art exhibitions, theatre, movies, and concerts among women, and studying and self-development among men were positively related to self-rated health. Unexpectedly, among women, active participation in religious events and voluntary work was negatively associated with self-rated health. This may indicate a coping method with ill-health. As a whole, only minor variations in self-rated health were found between the areas. However, the significance of the factors associated with self-rated health varied according to the areas. Economic factors, especially self-perceived adequacy of income was strongly associated with good self-rated health. Also when adjusting for economic and several other background factors social factors (particularly high social capital, social participation, and access to help when needed) were associated with self-rated health. Thus, economic and social factors have a significant relation with the health of the ageing, and improving these factors may have favourable effects on health among ageing people.