| Choice of Governance Structures in Alliance Formation: Evidence from the Japanese Biotech Industry |
| | Pangarkar, Nitin | National U. of Singapore | fbapn@nus.edu.sg | 65-8745299 |
| | Rajan, Sreenivas K. | National U. of Singapore | fbap6248@nus.edu.sg | (65) 874-5299 |
| | Which factors determine the choice between different governance structures in alliance formation? This question is the focus of our paper. Specifically, we study the choice between joint ventures and other forms of alliances. Consistent with the previous research on this topic (Osborn and Baughn, 1990; Sengupta and Perry, 1996), we argue that joint ventures will be preferred when Transactions costs are high.
Our conceptual framework is grounded in the studies of Osborn and Baughn (1990), Sengupta and Perry (1996) and Gulati (1995). The framework identifies factors that lead to high transactions costs and consists of two broad categories of variables: Functional Linkages and Trust. The Functional linkages category includes two variables: Joint R&D and Marketing. We identify four underlying variables for the concept of Trust: cultural similarity, previous relationship between alliance partners, multiple partners and prior alliances by one or more partners.
Our data consists of a comprehensive sample of alliances in the biotechnology sector (more than 600 in number) formed by Japanese companies over the time period 1978-95. Using logistics regression analysis, we find partial empirical support for both categories, Functional Linkages and Trust. Specifically, we find that joint ventures are preferred when the partners intend to undertake joint R&D and when there are multiple partners in an alliance. On the other hand, if at least one of the partners has formed previous alliances, other governance forms are chosen over joint ventures.
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| | Keywords: Joint Ventures; Japanese Biotech Industry; Trust |
| Purchase of Service Contracting: Proposal Rating as a Moderator |
| | Peat, Barbara | Indiana U., South Bend | [bpeat@vines.iusb.edu] | [(219)-273-4549] |
| | Costley, Dan L. | New Mexico State U. | dcostley@nmsu.edu | (505)-646-1201 |
| | The development of partnership betweeen a government funding agency and a private service provider,commonly known as contracting or privatization, has been steadily increasing over the past quarter century. A number of studies have been conducted which explore the reasons why government entities decide to privatize services, most of these indicate that cost savings, increased flexibility, and localizing services are the primary motives for privatizing. Yet other studies have examined the contracting process, exploring how these partnerships are developed. Many of these studies have taken a qualitative case analysis approach. There continues to be a paucity of research which allows for a quantitative examination of the purchase of services contracting process, with a potential for statistical analyzing the interrelationships between the steps of contracting. This study attempts to fill this gap through an empirical analysis of the factors which impact the decision of who the government funding agency will form partnerships with and how these decisions may impact the entire contracting process. It was determined that proposal rating functions as a moderator of the process. |
| | Keywords: Contracting; Services; Proposals |
| The Role of Culture in the Formation Process of International Alliances: Evidence, Critique and Future Directions |
| | Olk, Paul M. | U. of California, Irvine | pmolk@uci.edu | (949)-824-2044 |
| | Henderson, Gary R. | U. of California, Irvine | ghenders@uci.edu | 949-824-4628 |
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With the proliferation and increased relevance of global alliances, researchers and managers alike have sought to account for the emergence of these alliances. Central to many of the explanations is a focus on the country from which a partner comes or where the alliance is located. While country differences have been noted, research has not generally specified the source within a country for these variations. Most prominent in these discussions is the role of country culture. Variations of culture have often been attributed as the source for differences in the development of a strategic alliance.
This paper works towards developing an understanding of the importance of culture in the formation of an international alliance. We begin by drawing from alliance process literature and review the key dimensions to the formation process. We contribute to this burgeoning process literature by proposing how cultural differences may influence the formation process. We then provide a conservative evaluation of our argument by examining research that has documented variations across and between counties in alliance formation. This analysis, while including other country differences besides culture (e.g., financial and legal environment, natural resources), indicates that at a minimum, research does not have strong evidence of how culture affects alliance formation. We conclude with a discussion of future research efforts that can begin to develop a more comprehensive explanation for international strategic alliances.
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| | Keywords: alliance; culture; formation |
| Design and Performance in International Joint Ventures: A Dynamic Evolution Perspective |
| | Zhang, Yan | U. of Southern California | yanzh@bus.usc.edu | 213-749-6765 |
| | Abstract:
From a dynamic evolution perspective, this research provides consistent
evidence about the relationship between design and performance across the
eight international joint ventures (IJVs) operating in China. We find that
IJV design tends to evolve along a continuum toward independence and better
performance from a shared management type, through a dominant parent type,
to an independent type. During the evolution process, IJV performance
represents a motive force to stimulate IJV design to evolve forward. |
| | Keywords: Design; Performance; International joint ventures |