Assetone Case Study Organizational Culture

To begin with, AssetOne had several problems. Main one was the former performance of the company itself. Afterwards, having acquired TaurusBank, the company did not take care of the organizational culture, yet focused only on tasks with bureaucratic approach.

Talking specifically, executives of AssetOne could not make decision on critical things quickly since AssetOne was too formalized. Thus, AssetOne is too centralized. For example, acquired firm did not perform well after acquisition due to centralization. Previously, TaurusBank was giving investment fund division freedom to launch new products without approval of executive team, which was not found in AssetOne’s culture.

To put in a nutshell, AssetOne is mechanical structured organization and TaurusBank is organical structured one.

Moreover, according to conflict process model, there were differentiation problems, when two parties’ had different values, beliefs and experiences. Clients, i.e. external environment was dynamic and stable for TaurusBank and AssetOne respectively. Differentiation was inevitable in this acquisition where employees brought divergent corporate cultures into new combined organization. Employees argued over the correct or appropriate actions and decisions based on their unique experiences.

Another crucial problem is Ambiguous rules. This problem occurred when AssetOne intended to interfere with TaurusBank’s goals or functions. In our case, workers from two companies faced conflicting practices and values and few rules.
Not surprisingly, both company employees have communication problems. Sometimes, lack of information, misunderstanding of informations etc.
As a result, brilliant workers were lured away by competitors, or just employees were quitting from day to day.
All in all, merger turned to be unsuccessful and the firm was lagging behind the competitors.
Based on the strategies to change and strengthen organizational culture, I would like to suggest the following:
The vitally important step should be done by senior executives, i.e.

actions of founders and leaders. They can model new culture through subtle decisions. More precisely, the AssetOne executive should take into consideration acquired firm’s previous organizational culture. For instance, AssetOne had rule-oriented culture, whereas TaurusBank had innovation culture. Likewise, they might be had controlling and flexible culture respectively. By paying attention to these points, AssetOne can combine some attributes of each organizational culture and make new one. Noteworthy, AssetOne should apply adaptive culture, because they can satisfy customer needs and consequently match with TaurusBank’s

values.
Overall, in this case integration strategy is highly likely to be appropriate for these two firms out of 4 possible strategies. The reason is that acquiring company, AssetOne has relatively weak culture compared to small firm, TaurusBank. In other words, AssetOne has conservative perspective to the business, while Taurus has more liberal views. However, it should be mentioned that integration is not the best, it is just most optimal strategy out of 4. But in the future if AssetOne’s culture is stronger than another merging firm, assimilation would be best when acquiring firm has strong cohesive culture. On the other hand, if merging firm is from different sector, like IT company, then separation is good in that case.