When Jean-Marie Messier announced his resignation from Vivendi Universal, it sent shockwaves through business circles on both sides of the Atlantic Ocean. After all, Messier sought to build a global media empire that spanned from LA and NY to Paris.

A global empire

Messier was a figurehead for what many analysts called the new wave of European executives. A risk taker, he wanted to show Corporate America that the 21st century would belong to the Old Continent, namely France. Long considered a country that practically feared capitalism as we know it, France has shown an interest and desire to elevate its competitiveness, in recent years. Messier was seen as the catalyst of this drive. Problem was that he totally underestimated the specter of a turf battle between the factions in his global empire.

While there are many reasons to explain why he left the firm — rapid expansion with high debt and staggering financial loss — ultimately, his downfall had to do with misunderstanding the culture that he was in and miscalculating the degree to which he could bend that culture.

This is a great lesson for young professionals, because the world around us is changing and we are expected to lead that metamorphosis. Yet when we push for change too aggressively, we find ourselves on the outside.

Changing lanes

Similarly to firms that speak of “excellence” in mission statements but fail to deliver anything resembling that in daily life, the true degree to which management favors change is questionable. A look at how Vivendi Universal came to be suggests that too much change can be a bad thing.

The story goes like this: on the North American side of the pond, liquor company Seagram pulled a 180-degree turn and shifted gears by buying Universal, the entertainment behemoth with the world’s largest music label and one of the strongest film studios.

On the European side, Vivendi Universal also sought to shift gears as it wanted to diversify away from its roots as a water company. Almost overnight, the French utility company transformed, with CEO Messier making a bold bid to purchase the newly formed Universal.

The day that the merger was announced, shock and excitement reigned. After all, the potential of a global empire with extensive entertainment holdings was exciting. But considering that plenty of members on both sides disliked the deal, one knew that the road ahead would be rocky.

What happened along the way…

Buckle up

But no one could have anticipated how rocky the road would actually be. When the dust settled, the ad market got decimated, terrorist attacks shook the markets, the economy continued to nosedive, then Enron, Arthur Andersen and now Worldcom further rattled investor confidence. Given Vivendi Universal’s high debt load, it stood out in investor’s eyes and Messier took the fall, resigning in July 2002.

It’s the culture

In hindsight, Messier pushed his luck. It was one thing for him to establish residency in New York City, after all, the city is located midway between LA and Paris. But it was quite another for the proud French board members on the Vivendi side to see their power get diluted.

Just as Messier was ruffling some feathers, many on the North American side also had issues with losing so much power to the French. Apparently, one of the elder members of the Bronfman clan — the influential clan that founded Seagram — sought to wrest back some power to this side of the Atlantic.

Where to go?

It is indeed ironic that years after permeating the “bigger is better, we need size” mantra, companies are now asking themselves whether bigger is indeed better. Questions are being asked at AOL Time Warner regarding the rationale of having such a huge empire trying to move at a fast speed. The fact that they failed to deliver on the numbers did not help the warring factions at AOL and Time Warner. Today, most of the top lieutenants hail from Time Warner.

Vivendi Universal is no different; it grew too fast, became too unbearable, and even if it did manage to deliver on its promise, the turf battles between the French and North Americans would have never subsided.

Vivendi Universal and AOL Time Warner are beautiful gems, they have tremendous traction in the marketplace but they will both experience more change. Vivendi Universal, especially, will likely come out of this a leaner machine after having to shed some assets in order to make up for its massive debt. This presents an opportunity for the firm’s entertainment holdings to shine as it loses the extra weight.

Business side notwithstanding, in the end, the lesson comes down to understanding the culture you inhabit. People are ethnocentric by nature: No matter how much the world becomes a global market, we still seek to promote and protect our neck of the woods.

When the time comes for you to make such decisions, study the bottom line but remember that it is the people that make those numbers possible. Size and scale are necessary in business for survival, but it can also harm you. After all, the bigger they are, the harder they fall.

Ash Karbasfrooshan is also the author of Course To Success, available at www.CourseToSuccess.com.