Tag Archives: Berlin wall

Privatization in Germany: Lessons from a Third Side Case Study

As Germany (re-) unified itself in the months and years following the fall of the Berlin Wall in 1989, and as east German companies were privatized, the usual process was for the nationally organized “Treuhandanstalt” (Trust Agency or THA), as formal owner of all former assets of the German Democratic Republic (GDR), to sell off companies by negotiating directly with western German or foreign buyers. The companies themselves (management and employees) were only rarely included in the discussions or even consulted. This usually resulted in fruitless and acrimonious negotiations between buyer and seller, as both were far removed from and ignorant of the realities “on the ground”. The onsequences for those affected (the company) were dire. In a very few cases, however, company management or even employees managed to get involved (classic “third side” activity) and thus deescalate the conflict and mprove the outcome. One such scenario was that of the Agricultural Machinery GmbH in Leipzig (AMG), a loss-aking entity in a troubled industry, with little initial outlook for economic success. Read more….

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Filed under Change Management, conflict management