International Joint Ventures

Running head: INTERNATIONAL JOINT VENTURES
International Joint Ventures
Name of the Student:
Name of the University:
Author’s Note:

1INTERNATIONAL JOINT VENTURES
EXECUTIVE SUMMARY
This report aspires to explore the concept of international joint ventures (IJV) and its various
related aspects. The report firstly introduces the concept of international joint ventures and
the different circumstances in which the firms undertake the concerned process. More
importantly, the report also articulates the benefits as well as the challenges which are
involved with the concerned process. The report next takes the example of a successful IJV,
namely, Toshiba Corporation, Hitachi Limited and Matsushita and an unsuccessful IJV,
namely, Tiffany & Co jewellery and Swatch Group and analyses the reasons for their success
and failure. Lastly, the report offers some recommendations like outlining clear objectives at
the beginning of the venture, effective utilisation of organisational resources and formulation
of effective management and leadership styles that the firms can follow to ensure the success
of the IJVs undertaken by them.

2INTERNATIONAL JOINT VENTURES
Table of Contents
Introduction................................................................................................................................3
International Joint Ventures (IJV)..............................................................................................4
Circumstances under which firms undertake IJV......................................................................5
Benefits and Challenges of IJV..................................................................................................6
Successful IJV............................................................................................................................8
Toshiba Corporation, Hitachi Limited and Matsushita..........................................................8
Reasons for the success of the IJV.........................................................................................9
Unsuccessful IJV......................................................................................................................10
Tiffany & Co jewellery and Swatch Group.........................................................................10
Reasons for the failure of the IJV........................................................................................10
Recommendations....................................................................................................................11
Conclusion................................................................................................................................12
References................................................................................................................................13

3INTERNATIONAL JOINT VENTURES
Introduction
As opined by Reuer1, the process of international or globalisation had positively
affected the modern business world and the net result of this is that the different business
firms are increasingly looking to expand their business operations in the other nations of the
world. Westman and Thorgren2 are of the viewpoint that the one of the most important
challenges that the business firms face during the process of internationalisation is the fact
that they are not always sure regarding the kind of market entry mode they need to select for
entering into the business markets of the host nations. It is precisely here that the concept of
international joint venture becomes important becomes important within the framework of
the present-day business world. For example, it is seen that the process of international joint
venture is especially important for the firms which want to indulge in international trade and
commerce or for that matter extend their business operations to the other host nations yet do
not want to take full responsibility for the same3. However, at the same time it is seen that
there are various factors like business objectives, cultural aspects, management styles,
leadership approach and others while entering into the process of joint ventures with the firms
from other nations. The purpose of this report is to analyse the concept of international joint
ventures and its various aspects through the specific lens of one successful example and one
unsuccessful example.
1 Reuer, Jeffrey. "How real are real options? The case of international joint ventures." Creating value: Winners
in the new business environment (2017): 59-81.
2 Westman, Christoffer, and Sara Thorgren. "Partner conflicts in international joint ventures: A minority owner
perspective." Journal of international management 22, no. 2 (2016): 168-185.
3 Park, Chansoo, Ilan Vertinsky, and Manuel Becerra. "Transfers of tacit vs. explicit knowledge and
performance in international joint ventures: The role of age." International Business Review 24, no. 1 (2015):
89-101.