Challenges due to the exogamic nature of Sino-foreign joint ventures

Summary

Sino-foreign joint ventures are exogamic partnerships: the partners have different profiles, contribute different resources and pursue different objectives. The literature highlights various risks and problems in the day-to-day management of such alliances. Whether Chinese managers’ perceptions corroborated these issues was tested in 67 equity joint ventures. The empirical investigation showed that partners have to: (1) deal with conflicts, (2) manage marketing issues such as branding, sales networks and market research. Data also showed that the most important risks relate to competition on the market, political and macro-economic environments, conflicts in making strategic decisions and the unbalanced nature of the relationships.

Key Words:

• inter-firm alliances
• international joint venture management
• exogamic partnerships
• cultural inconsistencies
• conflict management
• risk management
• learning through alliances
• Chinese business