💼 How Culture Affects Business Performance
- Motivation — a positive culture increases engagement and reduces absenteeism
- Recruitment — strong cultures attract talent who share those values
- Decision-making — culture influences risk tolerance and speed of decisions
- Innovation — open cultures encourage new ideas; rigid cultures stifle them
- Customer service — culture shapes how employees treat customers
- Change management — a flexible culture adapts more easily to change
In exam answers, link culture to specific business outcomes. Do not just describe the culture type — explain how it helps or hinders the business.
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💥 Culture Clash
When two businesses merge or one acquires another, their cultures may conflict.
- Different working styles, communication norms, and values clash
- Employee resistance and increased turnover
- Loss of productivity during transition
- Many mergers fail because of culture clash — not financial reasons
The Daimler-Chrysler merger (1998) is a classic example of culture clash — German engineering precision met American flexibility. The merger was widely considered a failure largely due to cultural differences.