Determinants of success of joint ventures in India

Abstract

Joint ventures provide an attractive market entry strategy for a foreign company because they can leverage the local market knowledge, distribution channels, capacity and talent of the local companies. Further, the local companies can also benefits from the strength of the foreign companies like technology, intellectual property and experience.

Parameters like control, technology, financial resources, cooperation between the firms, joint venture experience, cultural fit, and motivation behind the joint venture formation – regulatory issues and export-orientation have been found to be important factors that affect joint venture performance. Stability and perceived success of the joint venture have been found to be key measures determine the performance of joint ventures.

A model has been developed to study of the effects of the parameters on the measures of Performance of joint ventures. Due to lack of primary data, the model has not been validated. However, this study can act as a starting point for further studies aimed at determining the success factors of joint ventures in India.