| dc.description.abstract | The study of international joint ventures (IJV) has been dominated by the focus on partner interactions as the underlying theoretical construct. It is argued that a less studied but relevant lens is that of development of dynamic capabilities (DC) in the joint venture to perform. Dynamic capability refers to an organisation’s ability to adapt and sustain in changing environments by altering its resource-base. This research addresses the gap in the literature and examines how organizations develop dynamic capabilities in international joint ventures. Case-based inductive research on three heterogeneous international joint ventures in Indian life insurance industry was used as the method. Indian life insurance industry was chosen primarily because of the prevalence of international joint ventures in the sector owing to government regulations, and attendant environmental dynamism witnessed by the industry. Interviews of top and senior management within the organisation and publicly available secondary sources formed the basis of the cases.
Data was analysed for development of dynamic capabilities on the modes of resource creation/acquisition, resource extension, resource realignment/modification, and resource shedding, and the three environmental triggers formed the reference point. Primarily, the three environmental triggers that corresponded with the life cycle of an IJV were the regulations of December 2005 (intermediate stage), and July 2009 and June 2010 (matured stage).
It was found that the stage of the life cycle of an IJV marginally impacted on the manner in which it developed dynamic capability. Overall, the involvement of foreign parent (FP) in altering the resource-base was found to be higher in an intermediate stage as compared to an advanced stage of the IJV life cycle. In the intermediate stage, resource creation/acquisition is facilitated by limited and phased entry into new domains, dedicated and high-powered cross-functional teams, intense involvement of the foreign parent, and strong alignment with bancassurance partner. Resource extension is enabled by phased entry into the new and turbulent domains, and foreign parent’s involvement in buffering against environmental shocks. Resource modification/realignment is facilitated by dedicated and high-powered cross-functional teams, creative focus on human resources, integration of the Indian parent as a business associate, and relevant foreign parental support. And finally, high involvement of the foreign parent reduces the need for resource shedding.
At matured stage of an IJV life cycle, resource creation/acquisition is facilitated by dedicated and empowered teams, intense communication to all stakeholders, focus on strong business fundamentals, and foreign parent supports mainly in cross-fertilisation of ideas. Resource extension is supported by focus on existing human resources, deployment of previous learning, parental support in strengthening business fundamentals, and shrinkage in the role of the foreign parent. Tools required for resource modification/realignment are most extensive, and the list includes dedicated teams, creative focus on HR, deployment of learning from previous regulations, an organisational structure with higher connect with the field, a priori identification of core area of change, Indian parent being bancassurance partner, and shrunk role of the foreign parent. Resource shedding involves identification of non-core, unproductive and irrelevant activities in light of changing regulations, and focus on business fundamentals.
The theoretical and practical implications of this study are discussed. The study specifically advances the conceptualisation of dynamic capability and its relevance to analysing international joint ventures. | en_US |
