The Study On The Cross-cultural Conflict Management Strategy Of Chinese Company's Merger And Acquisition Of Korean Company

With the continuous development of economic globalization,the number and scale of foreign direct investment by Chinese companies is expanding,and the number and scale of cross-border M&A enterprises is increasing.Chinese companies achieve the internationalization through various mergers and acquisitions or direct investment abroad.However,due to the differences in national and corporate cultures between the two,the management of cross-border M&A companies are also challenged by cross-cultural issues.Once mismanaged,it is very likely to cause conflicts and affect the normal operation and social image of the company.It is not difficult to detect the cause of failure for many overseas mergers and acquisitions,that the cultural conflict is the main reason.By means of literature analysis,interviews and case analysis,this paper studies the strategies of Chinese company W's cross-cultural conflict management after its acquisition of Korean company G.W is a domestic urban development group.It started out as a financial company whose current business involves finance,real estate,culture,education,medical care,and hotels.In order to integrate Korea's high-quality cultural resources,in 2016,W invested heavily in the acquisition of the shares of Korea's famous entertainment company G,becoming the controlling shareholder of the latter.Due to its poor financial status,G has suffered losses in successive years,and it also needs strong Chinese capital injection to improve its financial conditions.However,after the completion of the merger,the two sides entered into several conflicts due to discrepancy in culture,industries,operation philosophy,communication gap,and the conflict escalated quickly.Eventually,W intervened as a controlling shareholder,and dismissed the founder and CEO of G,leading to some employees of the company protesting and going on strike.This paper compares the cultural differences between China and South Korea by using Hofstede's cultural dimension theory to analyze the conflict between W and G,and proposes measures to deal with cross-cultural conflict from three aspects such as concept integration,personnel integration and interest integration.In terms of concept integration,the focus is on establishing common business objectives and corporate culture,and in this way proposing the construction of cultural institutions;in terms of personnel integration,it is mainly to optimize human resource management and strengthen communication,and accordingly propose the implementation of localization strategies and communication mechanism;In the aspect of benefit integration,the core is the adjustment of the salary incentive system,and therefore the evaluation of key performance indicators and equal pay for equal work are proposed.