In the Global Market, Internarional Joint Ventures (IJV) are becoming prevalent phenomeno and many multination companies have managed to experience considerable growth by making alliances (such as Joint Ventures). There are several factors which needed to be controlled carefully, otherwise it would be resulted in weaken the performance of the specified IJV. It has been estimated that about 37-70 percent of IJV are reported to experience the performance problems incurred due to the cultural differences and thus leaded the specified ventures towards the costly Culpan (2002) explained International Joint Venture (IJV) as the process which includes two or more companiess belong to different countries to collaborate together.The decision to decide wheather or not to make a joint ventures included four different stages (Initial, Formation, Operation & Outcome). There are two kinds of cultures which directly makes an impact on the Joint Venture. The first one is the organisational culture and the second type of culture is the national culture. Pothukuchi, et al. (2002) stated that the problem arises in IJV is because of significant Impact of the national culture upon the behavioral and management system which then directed towards conflicts. Same case is observed in the organisational culture as well where any differnece or dispute can cause conflict and also can destablise the Joint Venture’s performance or progress. The case study of Sony Ericsson also fallows the same approach of the Joint Venture as it was collaboration between two multinational companies (Sony & Ericsson) who were coming together with intention of single corporate which could not be possible for both companies to accomplish on the individual basis. It has been found out that the organisational cultural difference has negative impact on the performance of the International Joint Ventures (IJV). On the other hand, national cultural difference can pose either positive or negative impact but the intensity of that difference is not much aggressive. The emphasis of companies engaged in International Joint Venture on the factors which would be resulted in overcoming national cultural difference problems and also on developing the management which would be acceptable for both partners to adopt and implement could contribute extensively to the success of International Joint Ventures.
Table of Contents
CHAPTER-1: AIMS & OBJECTIVES
1.1. BACKGROUND CONTEXT
1.2. RESEARCH QUESTION
1.3. RESEARCH OBJECTIVE
1.4. SUMMARY
CHAPTER-2: LITERATURE REVIEW
2.1. INTERNATIONAL JOINT VENTURES (IJV) AS A CONCEPT
2.2. PROCESS OF INTERNATIONAL JOINT VENTURES (IJV)
2.3. CULTURES WITHIN THE IJV
2.4. NATIONAL CULTURE
2.4.1. DIMENSIONS OF NATIONAL CULTURE
2.4.1.1. POWER DISTANCE
2.4.1.2. UNCERTAINTY AVOIDANCE
2.4.1.3. INDIVIDUALISM & COLLECTIVISM
2.4.1.4. MASCULINITY AND FEMININITY
2.4.1.5. LONG-TERM AND SHORT-TERM ORIENTATION
2.5. ORGANISATIONAL CULTURE
2.5.1. DIMENSIONS OF ORGANISATIONAL CULTURE
2.5.1.1. PROCESS VS RESULT ORIENTATION
2.5.1.2. EMPLOYEE VS JOB ORIENTATION
2.5.1.3. PAROCHIAL VS PROFESSIONAL ORIENTATION
2.5.1.4. OPEN VS CLOSED SYTEM ORIENTATION
2.5.1.5. LOOSE VS TIGHT CONTROL ORIENTATION
2.5.1.6. NORMATIVE VS PRAGMATIC ORIENTATION
2.6. SUMMARY
CHAPTER-3: CASE STUDY
3.1. CASE STUDY ON INTERNATIONAL JOINT VENTURE: “SONY ERICSSON”
3.1.1. MOTIVE OF JOINT VENTURE
3.1.2. PROCESS OF INTERNATIONAL JOINT VENTURES (IJV)
3.1.3. PARTNERS’ CULTURES
3.1.3.1. PARTNER-1 (ERICSSON) CULTURE
3.1.3.2. PARTNER-2 (SONY) CULTURE
3.1.4. COMPARATIVE ANALYSIS
3.2. SUMMARY
CHAPTER-4: DISCUSSION & CONCLUSION
4.1. DISCUSSION
4.2. CONCLUSION
4.3. RECOMMENDATIONS FOR FUTURE STUDIES
Research Objectives and Focus Areas
The primary aim of this research is to investigate the extent to which International Joint Venture (IJV) performance is impacted by cultural differences at both national and organisational levels. The study seeks to differentiate between the effects of these two levels and to evaluate whether organisational culture serves as a more significant predictor of IJV outcomes compared to national culture.
- Analysis of International Joint Venture (IJV) processes and decision-making stages.
- Evaluation of Hofstede’s cultural dimensions in both national and organisational contexts.
- Comparative analysis of the Sony Ericsson Joint Venture as a practical case study.
- Identification of management strategies to overcome cultural incompatibility in cross-border alliances.
- Assessment of the relative impact of national versus organisational cultural differences on partnership success.
Excerpt from the Book
3.1.4. Comparative Analysis
In reference to the given case study of Sony Ericsson renowned example in the context International Joint Ventures, it has been found out that the organisational cultural difference has negative impact on the performance of the International Joint Ventures (IJV). On the other hand, national cultural difference can pose either positive or negative impact but the intensity of that difference is not much aggressive. This reason has been drawn after analysing the approach of both companies. Rather than focusing more the financial results it was observed that the Ericsson organisation culture characterised with Open System and Process Oriented features were intended to focus more on settling its own issue in order to make its business operation effective, but on the other hand Sony was seemed to be curious to perform well in the short run in order to keep themselves competitive in the mobile phone manufacturing market. In general, such differences in the context of organisational behaviour and practices had been resulted in arising certain issues (Misunderstanding, Conflicting Expectations & Interactions) which were proved to be dysfunctional for the given Joint Ventures operations.
Summary of Chapters
CHAPTER-1: AIMS & OBJECTIVES: This chapter provides the background context, defines the research questions regarding IJV performance, and outlines the objectives of the study.
CHAPTER-2: LITERATURE REVIEW: This chapter reviews existing theories on International Joint Ventures and explores cultural dimensions at both national and organisational levels using Hofstede’s models.
CHAPTER-3: CASE STUDY: This chapter applies the previously discussed theoretical framework to the Sony Ericsson partnership to analyse how specific cultural differences influenced its operations and final dissolution.
CHAPTER-4: DISCUSSION & CONCLUSION: This chapter synthesises the findings to demonstrate that organisational cultural differences exert a greater impact on IJV performance than national cultural differences and provides recommendations for future research.
Keywords
International Joint Ventures, IJV, National Culture, Organisational Culture, Hofstede, Cultural Dimensions, Sony Ericsson, Strategic Alliance, Cross-border Alliances, Performance Management, Cultural Incompatibility, Business Ethics, Management Styles, Corporate Identity, Partnership Success.
Frequently Asked Questions
What is the primary focus of this research project?
The project focuses on how cultural differences, both at the national and organisational levels, affect the performance and success of International Joint Ventures.
What are the central thematic areas covered in this work?
The work covers the definitions and processes of Joint Ventures, the impact of national and organisational cultural dimensions on business partnerships, and a practical analysis of cross-cultural challenges.
What is the main research question?
The research question investigates to what extent International Joint Venture performance is affected by cultural differences and whether these effects differ significantly between national and organisational contexts.
Which scientific methods were employed?
The research utilizes a literature review of existing management theories and a qualitative case study method, specifically examining the Sony Ericsson partnership.
What does the main body of the work address?
The main body examines the four stages of Joint Ventures (Initial, Formation, Operation, and Outcome) and evaluates the specific cultural values of partners using the models proposed by Hofstede.
Which keywords characterize this paper?
Key terms include International Joint Ventures, Organisational Culture, National Culture, Cultural Incompatibility, and Strategic Alliances.
How did the Sony Ericsson case study illustrate cultural conflict?
The case study highlighted that differences in organizational orientations—specifically Ericsson's process-oriented approach versus Sony's result-oriented and pragmatic approach—led to conflicting expectations and eventual performance issues.
What conclusion was reached regarding the relative impact of cultural levels?
The study concludes that organisational culture is a more potent predictor of IJV performance and satisfaction than national culture, which showed less aggressive impacts.
- Quote paper
- Junaid Javaid (Author), 2013, Cultural Distance and the Performance of International Joint Venture, Munich, GRIN Verlag, https://www.hausarbeiten.de/document/232217
