Until 1998, the car market knew a slowly, but constantly sale’s increase. As a part of this market, Daimler, a German car’s brand and Chrysler, an American car’s brand decided the 7th of May 1998 to merge, to combine their strengths and opportunities to face the future.
Daimler was created with its original name Daimler-Benz in 1926 and was actually at the beginningmanufacturer of automobile engine, automobile and internal combustion engine.
Chrysler was created in 1925. It grew really quickly during the thirties, possessing 3800 retailers in the American territory. It became the most profitable producer in the world during the nineties even if it had brought itself back from the bankruptcy since the World War II.
Both of the brands were really doing finebefore the merge, making a lot of profits on the American and European markets. The key-driver of this merge was an opportunity for Daimler to increase its American market thanks to Chrysler’s network, because before the merge, it just held 1% of this American market, dominated by the Toyota luxurious brand Lexus.
Daimler saw an opportunity to increase its American network by using the Chrysler’sone. By the way, Daimler’s CEO Jurgen Shrempp said that Chrysler would not do it alone any longer if the merge wouldn’t happen.
Thanks to this merge, the brand Daimler Chrysler became one of the three biggest car’s company in the world, with a market capitalization approaching $ 100 billion and more than 440 000 employees.
But one question came to the mouth of all the people after one yearof merge: True merge or Daimler’s acquisition?
We will see how they managed to merge in heaven and break up in hell.
1. Identify basic organisation design issues at Daimler Chrysler
At the beginning of the adventure, both the CEOs of Daimler and Chrysler said that they would serve as co-chairs for at least three years. But actually, the Daimler’s CEO wanted to rule with his Germanexecutives the game, owning 58% of the new company.
The company had a complex supply chain and highly effective procurement and supply chain strategies.
The new company implemented a lot of new changes during the first month, as an improvement for the operational flow thanks to some new information’s technologies, and also implementing a new way to track 100% of the production in transit.
Wecan also said that the Chrysler’s vice-president, David Hodgson, use several key units to try succeeding into the market like implementing some plants with for each of them, a mission like one plant for programming and one for scheduling. He implemented also few groups like one for handle materials, one for release material and one to handle inbound and outbound vehicle transportation.
As aresult of the team’s work, the company has realigned its massive supply organization to streamline operations and centralize responsibility.
But operation and management were not integrated as ‘equal’ because of both the very different way in wish Germans and Americans operated and the unwillingness of Daimler employees to concede some of their ground regarding the direction in which thecompany was headed.To conclude, Daimler attempted to take over the entire organization and impose their culture on the whole firm.
2. What form of organization design might be most appropriate for Daimler Chrysler
The main goal of an appropriate organization design is improving the probability by a successful organization. The organization design is a formal, guided process for integrated thepeople, information and technology of an organization.
Organization design begins with the creation of a strategy that is a set of decision guidelines by which members will choose appropriate actions
According to this definition of organization design we will see the different problems on the Daimler Chrysler’s organization and find solutions to improve it and discover the most appropriate...
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