This study describes operational experiences in 73 equity joint ventures (EJVs)
in China. Key difficulties are identified in the areas of local sourcing,
recruitment of skilled Chinese managers, and the clarity of laws and
regulations. Although interesting and meaningful differences are identified
across ventures, the analyses indicate that these three operational aspects are
serious and problematic irrespective of geographic location of the EJV in China,
its business scope, and the national culture of the foreign partner. Neither
location, nor industry, nor ethnic relation among partners shields the EJV
against the most problematic operational concerns. Given their structural and
cultural origins, these operational difficulties are likely to remain a headache
for foreign managers operating in China in the near future.
Get full access to this article
View all access options for this article.
References
1.
BairdInga S., LylesMarjorie A., and
WhartonRobert. “Attitudinal
Differences Between American and Chinese Managers Regarding Joint Venture
Management.” Management International
Review30 (Special Issue 1990):
53–68.
2.
BeamishPaul W. “The
Characteristics of JVs in the People's Republic of China.”
Journal of International Marketing1, no. 2 (1993):
29–48.
3.
BeamishPaul W., and
BanksJohn. “Equity Joint
Ventures and the Theory of the Multinational Enterprise.”
Journal of International Business Studies18 (Summer 1987):
1–16.
4.
BorgonjonJ., and
VanhonackerW.R. “Modernizing China's
Managers.” The China Business Review19 (September-October 1992):
12–18.
5.
BorgonjonJ., and
VanhonackerW.R. “Management Training
and Education in the People's Republic of China.”
The International Journal of Human Resources Management5 (May 1992):
327–56.
6.
BrunnerJ.A.KohA., and LouX. “Chinese Perceptions of
Issues and Obstacles Confronting Joint Ventures.”
Journal of Global Marketing6 (1992):
97–127.
7.
CampbellN.A Strategic Guide to Equity Joint Ventures in China.New York:
Pergamon,
1989.
8.
ChildJohn. The Management of Equity JVs
in China.Beijing, PRC:
CEMI, 1990.
9.
DavidsonWilliam H. “Creating and
Managing Joint Ventures in China.” California
Management Review29, no. 4 (1987):
77–94.
10.
EitemanDavid K. “American
Executives’ Perceptions of Negotiating JVs with the PRC: Lessons
Learned.” Columbia Journal of World
Business (Winter 1990):
59–67.
11.
FischerH.H. “Joint Venturing in
China: A Negotiation Experience.” East Asian
Executive Reports (May 1993):
9–16.
12.
FrisbieJ., and BrecherR. “FIE Labor
Practices.” The China Business Review19 (September-October 1992):
24–25.
13.
GeringerJ. Michael. Joint Venture Partner
Selection: Strategies for Developed Countries.Westport, CN: Quorum Books
1988.
14.
GeringerJ. Michael, and
HebertLouis. “Measuring
Performance of International JVs.” Journal of
International Business Studies22, no. 2 (1991):
249–63.
15.
HendryxSteven R. “Implementation
of a Technology Transfer Joint Venture in the People's Republic of China: A
Management Perspective.” Columbia Journal of World
Business (Spring 1986):
57–66.
16.
HendryxSteven R. “The China Trade:
Making the Deal Work.” Harvard Business
Review (July-August 1986):
75–84.
17.
HofstedeGeert. Cultures’ Consequences:
International Differences in Work-Related Values.Beverly Hills, CA: Sage
Publications, 1980.
18.
KobrinStephen J. “Trends in
Ownership of US Manufacturing Subsidiaries in Developing Countries: An
Interindustry Analysis.” In Cooperative Strategies
in International Business, edited by
ContractorFarok and LorangePeter,
129–42. Lexington,
MA: Lexington Books,
1988.
19.
OslandGregory, and
CavusgilTamer S. “Performance
Issues of U.S.-China Joint Ventures.” California
Management Review38, no. 2 (1996):
106–130.
20.
PanYigang. “Formation of
Japanese and U.S. Equity Joint Ventures in China.”
Strategic Management Journal18, no. 3 (April 091993): 247–54.
21.
PanYigang. “Influences on
Foreign Equity Ownership Level in the Joint Ventures in
China.” Journal of International Business
Studies27, no. 1 (1996):
1–26.
22.
PanYigang,
VanhonackerWilfried R., and
PittsRobert E. “International
Equity Joint Ventures in China: Operations and Potential
Close-Down.” Journal of Global Marketing8, no. 3/4 (1995):
125–50.
23.
PunnettB.J., and YuP. “Attitudes Toward Doing
Business with the PRC.” International Studies of
Management and Organization20 (1990):
149–60.
24.
ShenkarOded. “International Joint
Ventures’ Problems in China: Risks and Remedies.”
Long Range Planning23 (June 1990):
82–90.
25.
TaiL.S.T. “Doing Business in
the People's Republic of China: Some Keys to Success.”
Management International Review28 (1988):
5–9.
26.
TeagardenM.B. and Von
GlinowM.A. “Sino-Foreign
Strategic Alliance Types and Related Operating
Characteristics.” International Studies of
Management & Organization20, nos. 1–2 (1990):
99–108.
27.
TeeceDavid J. “Multinational
Enterprise, Internal Governance, and Industrial
Organization.” The American Economic Review75, no. 2 (1983):
233–38.
28.
TseD.K., PanYigang, and AuKevin Y. “How MNCs Choose
Entry Modes and Form Alliances: The China Experience.”
Journal of International Business Studies28, no. 4 (091993): forthcoming.
29.
TseD.K., LeeKam-hon,
VertinskyIlan, and WehrungDonald A. “Does Culture
Matter? A Cross-Cultural Study of Executives’ Choice, Decisiveness, and Risk
Adjustment in International Marketing.” Journal of
Marketing52, no. 4 (1988):
81–95.
30.
VanhonackerWilfried. “Entering China:
An Unconventional Approach.” Harvard Business
Review (March-April 1997):
130–40.
