The research project discussed in this article was to show to what extent the shrinking world had wiped out the effects of national cultures, or whether persistent national culture differences have avoided the effects of globalization (Hofstede, Van Deusen, Mueller and Charles 785-803). Throughout history, people have always traded and made deals while pursuing their own, often very different, goals. There has been no need so far for trading partners to share goals and values. However, the business world is changing, and when businesses from different countries enter into joint ventures, strategic alliances, acquisitions, and mergers, this situation changes. When global companies merge with other global companies, or take over local businesses, they may find themselves in unfamiliar territory, businesswise. The differing goals and implications of the relationship in the host countries may have profound effects on their own goals and expectations. Strategic alliances often fall short of their promise; joint ventures drain resources; international acquisitions are resold; and mergers announced with enthusiasm often crash shortly thereafter.
Integrating people from different countries can be a difficult task, but it can be done successfully if the goals pursued are very clear (Hofstede, Van Deusen, Mueller and Charles 785). The main obstacle to be overcome is the difference in corporate governance. Even neighboring countries often have very different ownership and governance systems. For instance, in a 1997 study, in Britain 61 percent of the 100 largest companies had many small shareholders, while in Austria and Italy no large companies had this type of ownership. Foreign entries into the US from culturally distant countries are more likely to fail than those from culturally close countries. An analysis of Dutch companies showed that survival rates of entry decreased with cultural distance, but more for joint ventures a...