Huu Le Nguyen

Determinants of Conflict Management Strategies in International Joint Ventures: An Integrative Theoretical Framework

As firms increasingly engage in partnership with other firms though international joint ventures (IJV), differences in motives and national cultures cause conflicts to occur. This article examines the influence of the type of ownership control and the national cultural background of foreign parent firms on their conflict management strategy as used in their IJVs. Based on Killing (1983), ownership control is categorized into dominant control, equal control, and minor control. Hofstedes (2001) five cultural dimensions are adopted to typify national cultures. Taking a step forward from previous studies, this study shows that the ownership control position and national cultural background influence the choices of conflict management strategies foreign parent firms make.

Foreign Subsidiary Performance: Evidence from Ghana

The objective of this study is to examine the influence of selected ownership, location, and internalization-specific factors on performance of foreign subsidiaries in Ghana. Our analysis was based on 75 manufacturing investments made by MNEs from different countries in 1994–2008. The results indicated that market size, host country experience, greenfield establishment mode, and joint venture ownership mode had positively impacted performance of foreign subsidiaries independent of the measure of performance. Furthermore, international experience and cultural distance had influenced performance when the total performance measure was used. Finally, the ownership mode significantly influenced performance only in greenfield investments, and not in acquisition mode.

Governing for Success: The Host Country Uncertainty and the Design of Foreign Parent Control in International Joint Ventures

In this paper we develop a model of the international joint venture (IJV) control which deals with the level of uncertainty of the host country. The host country uncertainty is characterized by cultural, environmental, and competitive uncertainty. Following Geringer and Hebert (1989); Buckley et al. (2005), we conceptualized foreign parent control across three dimensions including mechanism, focus, and extent. Our empirical evidence is based on the survey of Finnish firms that established IJVs with local firms in the 1990s. The results show that foreign parent firms tend to exercise more formal, broad, and tight control over their IJVs when they perceived high cultural uncertainty and high competitive uncertainty in the host countries. On the other hand, they prefer formal, narrow, and loose control over their IJVs in cases of high environmental uncertainty. In addition, the firms that exercise broad, formal, and tight control in high uncertainty countries and narrow, social, and loose control in low uncertainty countries were more satisfied with their IJV performance. Finally, we conclude the paper by discussing the implications of our findings and directions for further research on IJVs.

International joint venture strategies and performance in the Baltic States

Purpose – The purpose of this paper is to analyse investment strategies and performance of Finnish firms in their international joint ventures (IJVs) established in Baltic States. Design/methodology/approach – The paper analyse performance of IJVs in Baltic States based on the IJV theory, international business literature, and foreign direct investments in Central and Eastern Europe (CEE) literature. The analysed factors include firm, investment, and inter-partner relationship-specific factors. To examine the propositions the paper used ten IJVs established by Finnish firms in various Baltic States between the period 1991 and 2005. Findings – The results show that the level of uncertainties in the countries and the differences between partners are not related to firms’ commitments and the entry mode choice. Several Finnish firms preferred cost leadership to compete with other firms in the local markets. In most cases there was a positive relationship between the level of partners’ equity share, commitment...

Value Creation in International Joint Ventures: Impact of Inter-Partner Factors and Location

One key goal when establishing international joint ventures (IJVs) is to create value in different ways for the partnering firms. The value creation can be via new innovations, more effective production processes, taking benefit of the synergy effects in various functions, and so on (see e.g. Deeds and Hill 1996; Barringer and Harrison 2000). The literature on IJV research shows that internal partner factors (Brouthers and Bamossy 2006) and the interaction between partners often significantly influence the cooperation. In addition, the effect of location factors on the operations of firms has been emphasized in international business research (Miller and Eden 2006). However, the current literature related to value creation in strategic alliances and IJVs provides relatively limited empirical results about these influences. Lee et al. (2013) found that value creation differs between alliances located in developing and developed countries. Furthermore, prior research suggests that resource complementarity between partners enhances the value creation potential in IJVs (Kumar 2008). Previous studies (e.g. Pothukuchi et al. 2002) suggest that both national and organizational cultural differences also play a crucial role in the operation and effectiveness of IJVs. Some studies (e.g. Hennart and Zheng 2002; Pothukuchi et al. 2002) have found that cultural differences have a negative impact on IJV operations, and some others (e.g. Li et al. 2001) have found a positive influence. Besides, interactions between partners, such as inter-partner flexibility, communication, trust, and control mechanisms, seem to be important factors that impact upon IJV operations (Vaidya 2000). On the one hand, several IJVs do not reach the value creation goals set for them and the units are therefore subsequently terminated (Christoffersen 2013); on the other hand, the earlier results of the value creation effects of several variables are mixed. Therefore it is important to investigate more fully the impact of various inter-partner and location related variables on value creation in IJVs.

Multilevel Analysis of Ownership Mode Strategy in China

Foreign direct investments’ (FDIs) entry mode strategy has received considerable attention from researchers in both the international business (IB) and the strategic management field (Zhao et al., 2004; Brouthers and Hennart, 2007; Morschett et al., 2010; Slangen and Hennart, 2015). Ownership mode strategy (OMS) is one of the most important dimensions of FDI entry mode strategy (Endo et al., 2014). Multinational enterprises (MNEs) can choose between wholly owned subsidiaries (WOS) and joint ventures (JVs). The level of ownership is a challenging strategic decision, as it determines the level of resource a firm must commit to foreign markets, the degree of risk a firm must bear in the target country, and the extent of control a firm can excise over its foreign subsidiary (Anderson and Gatignon, 1986; Hill et al., 1990). Furthermore, OMS has important implications for the survival and performance of foreign subsidiaries (Papyrina, 2007; Kim et al., 2010).

Liability of Country of Origin and Postacquisition Strategies of Emerging Market MNCs in Advanced Economies

International acquisitions (IAs) have become an increasingly important strategy for firms in global economies. In particular, IAs by emerging market multinational corporations (EMNCs) are rapidly gaining important attention (Beebenroth & Hemmert, 2013) because they have recently started influencing the world economies by means of their acquisitions of major MNCs from advanced economies with an annual growth rate of 26 percent (Rothenbuecher & Hoyningen-Huene, 2008).

Control Position Strategy, Cultural Distance, Conflict Resolution Strategies and Performance of International Joint Ventures

Facing fierce global competition, firms often establish international joint ventures (IJVs) with foreign firms (Kwon, 2013). However, researchers notice a high rate of IJV failure (e.g. Hennart, Kim and Zeng, 1998). One of the key reasons is that firms often have different goals and ways of communications. Another reason is that inter-partner conflicts often lead to dissolution of partnership (Fey and Beamish, 1999; Pajunen and Fang, 2013). Thus, understanding conflict is crucial to organisations (Boonsathorn, 2007, Das and Kumar, 2010; Krone and Steimel, 2013) since conflict resolution strategies of parent firms affect IJV performance (Fey and Bearmish, 1999; Lu, 2006; Yavas, et al., 1994). Lin and Germain, 1998) suggest that foreign parent firms differ in their choice of conflict resolution strategies (CRS). Wang, Lin, Chang and Shi (2005) notice that conflict handling styles of partner firms becomes an important topic in IJV research, and White III, Joplin and Salama (2007) maintain that conflict resolution strategy is an underexplored area in the international business and management literature.

Entry Motives, Psychic Effects and Post-Acquisition Strategies of Emerging Economy Multinationals in Developed Countries

Acquisitions are among the most popular entry strategies abroad applied by multinational firms. These firms enter the acquisitions of foreign companies for numerous reasons, mainly to attain new competences, because they allow opportunities for creating synergies, overcome trade entry barriers and establish prospects to increase their market share overseas (Vermeulen and Barke ma, 2001). In the 1980s and the 1990s, most of the acquisitions were by multinational firms from advanced economies, especially from the United States, Western Europe and Japan. Nevertheless, recently multinational firms originating from numerous emerging economies, especially from Brazil, Russia, India and China (BRIC), have been strongly impacting the global economy through a number of acquisitions of major multinationals that originate from advanced economies. These international expansions call for further research (Luo and Wang, 2012). According to Verma etal. (2011), over 60 per cent of the total number of acquisitions performed by emerging country multinational companies (EMNCs) till the end of 2010 took place in developed economies. This percentage has been continuously increasing since the start of the global economic slump. Fetscherin and Beuttenmuller (2012) claim that Chinese investments in developed economies are expected to increase considerably in the next few years.