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Those deals easily grab headlines due to the big numbers and the parties involved cannot stop repeating how beneficial the new merger will be in terms of cost savings and synergies. However, many times those deals deliver less than they initially promised for a number of reasons and one of those is the cultural dilemma of cross-border deal-making.

To find out more about what cross-cultural problems the buyers from last year may encounter this year, BNamericas spoke to best-selling author and cross-cultural consultant Terri Morrison.

Morrison is president of consulting firm Getting Through Customs and co-author of the book Kiss, Bow or Shake Hands, which won an award for best business book in 2007 from Library Journal.

BNamericas: How important are national cultures today when globalization is marching at an ever faster pace and Thomas Friedman says the "world is flat?"

Morrison: The world is getting flatter, as Thomas Friedman says in his great book, but traditions dating back hundreds or even thousands of years do not change that easily and they have to be considered when doing business in foreign countries. In every culture there is a range of variables that will determine your degree of success in negotiations and managing people.

BNamericas: Many international banks made big investments in M&As last year in Latin America. What are the main things for these companies to keep in mind to integrate successfully the banks they bought and to manage their new employees?

Morrison: First you face the challenge of the different corporate cultures, which in some companies can be dogmatic. Then on top of that you have the different national cultures to consider and to do that successfully it's always fundamental to listen and appreciate the experience of the people on the other side of the table. In cross-border mergers and acquisitions it's vital to let people from the other country feel that they are part of the process and it is also tremendously important to have an open mind. To build trust from the start is crucial in these processes.

It's also important that headquarters send executives who have both the necessary technical and cross-cultural skills to lead the new teams that will be formed.

BNamericas: Canada's Scotiabank has been very aggressive in Latin America over the last few years, buying several banks in different countries. How do you see the Canadian executives faring in the cultural waters of Latin America?

Morrison: Generally Canadians are open-minded, so that in itself should help reduce the risk of cross-cultural conflicts. However, there are some major cultural differences between Canadians and Latin Americans in terms of how they view time and physical space. Punctuality could become an issue if your new boss is British-Canadian; or if the British-Canadian executives maintain a larger physical distance when in meetings or at social events.

To take an extreme example, some of the physical contact between male and female co-workers in Brazil could easily be seen as sexual harassment in the US. On my first trips to Brazil I was initially surprised by the close proximity and felt uncomfortable. Then I realized that was normal and acceptable behavior in Brazil, and I started to relax. Nowadays it's no longer a problem at all!

BNamericas: What about South Africans? Standard Bank from South Africa is also on the move in Latin America's banking sector.

Morrison: South Africans benefit from not having a cut-throat approach to business. For them it is not about, I win and you lose. Instead they take the win-win approach when doing business abroad and that helps to overcome the cultural obstacles they may face in foreign markets.

BNamericas: Last year the Chilean branch of Citigroup announced it was going to merge with local bank Banco de Chile and in the beginning of this year they started to operate as one. In general, what problems or challenges do executives from the US face when working in Chile or other Latin American countries?

Morrison: Business can be done at lightning speed in the US in comparison to many Latin American countries. Punctuality is highly emphasized and delays are seen as insults. In order to save time, tremendous amounts of data are transmitted through webexs and archived on corporate intranets rather than discussed in person. US executives find the difference in pace and general perceptions of time to be challenging in Latin America.

Executives from the US also love the newest technical gadgets and many do not mind using them during meetings. US managers "talking" on a Blackberry, iphone, or the latest communications device while others are in the room can be highly irritating to Latin American executives. For them the cultural challenge is to realize that it is common practice in the US and your US associate may assume that a call is as important as the physical person in front of him or her.

In terms of negotiations, short-term goals and rewards are the normal focus for US managers while Latin American executives often consider the longer term relationship to be a priority.

BNamericas: Despite having a very strong global brand when buying Mexico's Banamex in 2001, Citigroup decided to keep the local brand and has not changed it since. Would you say that branding is a particularly difficult issue for banks and other companies when buying local competitors?

Morrison: It can be because in some regions of the world, like Latin America, Africa and the Middle East, consumers tend to be very loyal to people and brands. In these cultures, people look for stability and long-term relationships. Whereas in the US we tend to be less loyal to brands and always look for the newest and the best, wanting to have the "next thing."

BNamericas: Any other factors playing against implementing a global brand versus keeping a local brand after an acquisition or merger?

Morrison: There is also the language problem. There have been so many blunders in terms of translating names in international business and also of famous international brands that acquire a negative connotation in some cultures. So sometimes it is better to simply stick with what works.

BNamericas: Some experts say that Chile has the potential to become an offshore location for international financial groups looking to outsource certain service jobs. From your experience, what are some chief factors for countries or cities that aspire to become attractive offshore locations?

Morrison: Considering Chile's telecom infrastructure, stable economy and politics I think there's a great opportunity. However, it is a key factor that the people who will perform those jobs are well prepared and therefore training becomes a fundamental issue. Dell, for example, chose to outsource customer service jobs to India and encountered some significant public relations problems because local staff was not thoroughly prepared. Such problems are serious because they can damage your company's credibility and brand name.

BNamericas: Lastly, I would like to know what you are working on right now? A new book maybe?

Morrison: I am planning to start work on a series of books that combines the cultural aspects of doing international business with linguistic challenges. We will probably start with "Kiss, Bow or Shake Hands: Doing Business in Spanish," and "Kiss, Bow or Shake Hands: Doing Business in Mandarin."

About Terri Morrison

Besides being president of Getting Through Customs, Morrison is the co-author of five books, including the best-selling Kiss, Bow or Shake Hands: How to Do Business in Sixty Countries. The latest edition of that book has sold more then 250,000 copies.

She conducts seminars in intercultural communications, and has written on cross-cultural communications for many US and European publications, including American Airlines' in-flight magazine American Way, Swissair's Gazette, Sabena's PASSPORT, CEO Magazine, OAG's Frequent Flyer, and Industry Week online.

Morrison has appeared on many media broadcasts, including CNN, CNBC and NPR. She also serves on several boards, including the International Academy at Santa Barbara.

ABOUT THE COMPANY:

Getting Through Customs publishes Kiss, Bow or Shake Hands: Expanded Edition, an online reference of global business & social practices, cognitive styles, export and travel information. Among the company's clients are: Accenture, AT&T, Cisco Systems, Deloitte & Touche, Dun & Bradstreet, Ernst & Young, Global Crossing, IBM, Lucent Technologies, National Association of Realtors, Novartis, SABRE, and universities like Cornell, Harvard, The Wharton School, Princeton and Oxford.

By Ulric Rindebro