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Top management team trust, behavioral integration and the performance of international joint ventures

Top management team trust, behavioral integration and the performance of international joint... Purpose – This study seeks to identify antecedents of trust among top managers representing partners in international joint ventures (IJVs) and to show how this trust influences IJV performance. Design/methodology/approach – The paper proposes that the national cultural distance of the foreign partner, the business similarity of partners' organizations and behavioural integration are antecedents to trust, and that trust is a key mediator through which these antecedents affect IJV performance. Data are collected through a field survey from IJVs in Beijing and Shenzhen, PRC, and employ regression analysis to test these propositions. Findings – It is found that: trust across IJV factional subgroups is influenced by partners' business similarity and by the behavioural integration of top managers representing the partners from both sides; and this trust mediates the relationship between the behavioural integration of top managers in Sino‐foreign IJVs and overall venture performance. The effects of business similarity and partner national cultural distance on overall performance were not mediated by trust. Research limitations/implications – The sample of the study used is limited to one country only – China. Besides, the paper's measures of cultural distance and categorization of national origin of foreign partners of IJVs may be subject to criticism. Practical implications – First, the paper explicitly hypothesizes and tests the role of trust as a mediator of the relationships between trust antecedents and IJV performance. This is done in order to develop a more detailed understanding of how fixed partner characteristics and adjustable group processes affect IJV outcomes. Second, the study finds evidence that supports situational perspective and developmental perspective of trust development, but not the deterministic perspective. This is also consistent with some additional qualitative evidence which the authors collected through interviews. Third, the results indicate that some trust antecedents have direct effects on IJV performance, while others affect IJV performance through partner trust. Originality/value – The study's exploratory results offer important new information for IJV researchers and for managers of IJVs. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Asia Business Studies Emerald Publishing

Top management team trust, behavioral integration and the performance of international joint ventures

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Publisher
Emerald Publishing
Copyright
Copyright © 2013 Emerald Group Publishing Limited. All rights reserved.
ISSN
1558-7894
DOI
10.1108/15587891311319413
Publisher site
See Article on Publisher Site

Abstract

Purpose – This study seeks to identify antecedents of trust among top managers representing partners in international joint ventures (IJVs) and to show how this trust influences IJV performance. Design/methodology/approach – The paper proposes that the national cultural distance of the foreign partner, the business similarity of partners' organizations and behavioural integration are antecedents to trust, and that trust is a key mediator through which these antecedents affect IJV performance. Data are collected through a field survey from IJVs in Beijing and Shenzhen, PRC, and employ regression analysis to test these propositions. Findings – It is found that: trust across IJV factional subgroups is influenced by partners' business similarity and by the behavioural integration of top managers representing the partners from both sides; and this trust mediates the relationship between the behavioural integration of top managers in Sino‐foreign IJVs and overall venture performance. The effects of business similarity and partner national cultural distance on overall performance were not mediated by trust. Research limitations/implications – The sample of the study used is limited to one country only – China. Besides, the paper's measures of cultural distance and categorization of national origin of foreign partners of IJVs may be subject to criticism. Practical implications – First, the paper explicitly hypothesizes and tests the role of trust as a mediator of the relationships between trust antecedents and IJV performance. This is done in order to develop a more detailed understanding of how fixed partner characteristics and adjustable group processes affect IJV outcomes. Second, the study finds evidence that supports situational perspective and developmental perspective of trust development, but not the deterministic perspective. This is also consistent with some additional qualitative evidence which the authors collected through interviews. Third, the results indicate that some trust antecedents have direct effects on IJV performance, while others affect IJV performance through partner trust. Originality/value – The study's exploratory results offer important new information for IJV researchers and for managers of IJVs.

Journal

Journal of Asia Business StudiesEmerald Publishing

Published: Apr 26, 2013

Keywords: Trust; International joint ventures; Joint ventures; Strategic alliances; Business performance; China; Organizational performance

References