Partner selection for international strategic alliances in emerging economies (original) (raw)
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SSRN Electronic Journal, 2000
We examine the relative bargaining power in alliances between small-and medium-sized enterprises (SMEs) from emerging economies and multinationals from developed markets. Our work highlights the importance of founders' personal ties, network positions, and the processes their firms use to manage resources. Specifically, we evaluate how SME founders' ties with local government officials and business managers may serve as the conduit for value creation and SMEs' bargaining power over foreign multinational partners. Further, this work explores the importance of resource management processes (bundling and synchronization) to enhance the value of personal ties. In doing so, we offer theory to demonstrate that SMEs' bargaining power in strategic alliances is a function of the social relationships and resource management processes that underlie and shape the firms' competitiveness and capabilities in emerging economies.
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A substantial literature has evolved focusing on the ownership structure of international strategic alliances (ISAs). Most of the relevant studies are theoretical in nature and concentrate on the conceptual factors that influence the choice between equity and non-equity structures. A smaller number of studies provide some empirical evidence on the importance of some of the conceptual factors. The theoretical literature highlights the potential influence of relational capital and transaction costs as determinants of ISA structure; however, there is little empirical evidence on the relative importance of these potential determinants. Moreover, there is only limited and indirect evidence bearing upon the impact of host country governance attributes on ISA ownership structure. In this study, we provide statistical evidence on the importance of potential determinants of governance mode choice for a sample of ISAs involving Danish firms. Our study documents how the determinants of governance mode choice vary in importance depending upon the "quality" of the governance infrastructure of the host country.
International Business Review, 2006
We examine the strategic motivation for international strategic alliance (ISA) formation and partner selection criteria in a sample of 203 Chinese ISAs using questionnaire data obtained from Chinese partners. The highest ranked strategic motives of the Chinese firms are maintaining market position, international expansion, and technology exchange. In contrast, the major strategic motives for alliance formation of the foreign firms are characterised by market penetration and learning how to operate successfully in China. As anticipated the relative importance of strategic motives for ISA formation is found to vary between Chinese firms and foreign firms. We also examine aspects of partner selection criteria for ISA formation from the perspective of Chinese partners. Findings show that the task-related selection criteria are determined more by the strategic motives for ISA formation than are the partner-related selection criteria. This confirms that task-related selection criteria tend to be specific to the alliance whereas partner-related selection criteria are more general in nature.
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Using data from a web-survey of Danish partner firms engaged in international strategic alliances, this study explores the factors that drive alliance formation between two specific firms across national borders. The relative importance of a set of partner selection criteria is identified and related to extant theory. By means of exploratory factor analysis, a more parsimonious set of selection criteria is provided and their relationships to a number of characteristics of the sample -prior international alliance experience, administrative governance form, nationality of foreign partner and motives for alliance formation analyzed. The findings indicate that partner choice is a function of strategic motivation and varies significantly with governance mode and partner nationality.
2007
This article aims at identifying the individual and joint impact of two « country-level variables », namely national distance and country risk, on the survival of international joint ventures in emerging countries. Research hypotheses predicting the negative impact of national distance and country risk on survival are formulated in this article. These research hypotheses are tested in a sample of 165 international joint ventures that were formed in Brazil between 1974 and 2003. These joint ventures were subjected to an event history analysis over a period of time ranging from 1974 to 2005. The empirical results show that the intercultural dynamics increases the instability of international joint ventures whereas the survival of these alliances does not seem to be affected by the economic and political uncertainty of Brazil. Furthermore, the national distance between local and foreign partners has effects on survival that are variable according to the life cycle of international joint ventures.