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Performance measurement choices in international joint ventures: What factors drive them?

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  • Larimo, Jorma
  • Le Nguyen, Huu
  • Ali, Tahir

Abstract

How to evaluate performance of an organization and what factors influence the choices of performance measurements have remained unclear. The question is even more complicated for jointly managed organizations like international joint ventures (IJVs). This research investigates the determinant factors of performance measures used by Nordic firms in their IJVs. We tested our hypotheses with 89 IJVs established by Nordic firms. The results show that firms' motives, level of trust and cultural distance between foreign and local firms all have a strong influence on the choice of performance measures used. Furthermore, firms choose performance measures depending on the stage of the unit in the IJV life cycle. Interestingly target country experience influenced the choice of performance measurement, but previous IJV experience did not influence the measures used. The study offers several implications for managers to choose appropriate measures for their IJV performance evaluation as well as opportunities for further research.

Suggested Citation

  • Larimo, Jorma & Le Nguyen, Huu & Ali, Tahir, 2016. "Performance measurement choices in international joint ventures: What factors drive them?," Journal of Business Research, Elsevier, vol. 69(2), pages 877-887.
    • Handle: RePEc:eee:jbrese:v:69:y:2016:i:2:p:877-887
    DOI: 10.1016/j.jbusres.2015.07.003
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    5. Fadia Bahri Korbi & Karim Ben Slimane & Dora Triki, 2019. "Managing Crisis within International Joint Ventures Insights from the case of Délice-Danone during the Arab Spring in Tunisia," Post-Print hal-02568493, HAL.
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    7. Jonas Fernando Petry & Mohamed Amal & Dinorá Eliete Floriani, 2018. "Institutional Distance, Regional Clusters and Performance of Foreign Subsidiaries: Evidences from Brazil," Brazilian Business Review, Fucape Business School, vol. 15(3), pages 302-316, May.
    8. Kwok, Francis & Sharma, Piyush & Gaur, Sanjaya Singh & Ueno, Akiko, 2019. "Interactive effects of information exchange, relationship capital and environmental uncertainty on international joint venture (IJV) performance: An emerging markets perspective," International Business Review, Elsevier, vol. 28(5), pages 1-1.

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