Split management control and international joint venture performance

Chang-Bum Choi and Paul W Beamish
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Chang-Bum Choi: Bryan School of Business and Economics, The University of North Carolina at Greensboro, USA
Paul W Beamish: Asian Management Institute, Richard Ivey School of Business, The University of Western Ontario, Canada

Journal of International Business Studies, 2004, vol. 35, issue 3, 215 pages

Abstract: A framework is presented to characterize four different ways in which management control is partitioned between a multinational enterprise (MNE) and local partners within international joint ventures (JVs): split control management, shared management, MNE-partner-dominant management, and local-partner-dominant management. The framework was tested using a sample of international JVs in Korea. We found that JVs following the split control management performed better than any other approach. No performance differences were found among the remaining three types of management control. This suggests that MNEs and local partners should split control: that is, choose the activities to control so that those chosen activities can be matched with their respective firm-specific advantages. Journal of International Business Studies (2004) 35, 201–215. doi:10.1057/palgrave.jibs.8400078

Date: 2004
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