The use of Joint Ventures as a strategic tool for multinational companies

Bachelor Thesis from the year 2008 in the subject Business economics - Business Management Corporate Governance grade: 10 Edinburgh Napier University (Edinburgh Napier University) language: English abstract: The dissertation covers the field of competitive collaboration by focusing on Joint Ventures. It identifies the strategic usefulness for multinational companies by evaluating critical success factors and pre-conditions. Due to increasing pressure from the business environment the trend of competitive collaboration has accelerated. In this context Joint Ventures were identified as a potential field of investigation. The apparent contradiction of cooperating with a competitor evoked the discussion of potential risks. It was questionable whethercompanies do so loose some of its sovereignty. This question created the incentive to identify essential requirements when forming a Joint Venture. By analysing the available literature Joint Ventures were identified as a strategic tool for multinational companies to achieve competitive advantage. It was outlined that the risks that come along with competitive collaboration can be minimized if the preconditions of Joint Venture creation are considered adequately. Moreover the analysis clarified the need for explicit responsibilities for each sub-process when forming a Joint Venture. The analysis of a specific case highlighted the essential learning potential from past cooperations in order to succeed over the long term.Finally the analysis showed that well structured and re-arranged measures leverage the benefits of competitive collaboration. It was identified that a loss of sovereignty only occurs if the alliance is managed poorly. It was recommended that a three stage model including the sub-processes allianceplanning partner selection and alliance structure and management should be implemented to generalise the process of alliance management. Moreover setting a focus on strategic and cultural comp