ABSTRACT
When it diversified into paint making, JSS formed a joint venture with Pinchin Johnson & Co. (PJ) and custom designed a private communicating infrastructure to blend its capabilities with those of its new partner. Subsequently, internal and external shocks compelled the firms to modify this framework to sustain transfers of knowledge and to create new project-specific expertise. What Cripps called team building was a critical factor in the success of the venture: Orient Paint, Varnish and Colour Co. (OP)
A growing body of theoretical work is striving to identify those variables that determine the outcome of joint ventures. The ability to establish ‘complementarity’ between partners is seen as being crucial to a successful relationship. In response to the imprecise way much of the literature treats the concept of ‘complementarity’, Geringer (1988, 1991) studied an extensive list of task-and partner-specific attributes that influence initial partner selection and found the former to be the most important. Proceeding further, Lorange (1988) identified five key factors that determine the effectiveness of both planning and controlling joint ventures: a clear organisation, a viable competitive strategy, value-enhancing roles for each partner, compatible behaviour, and a balance of power. Following a different angle, Casson (1990) recognised that a joint venture may be the outcome of existing trust or an instrument for invoking co-operation. He suggested that a venture based upon sharing intangible assets in a dynamic market provides a chance for participants to demonstrate forbearance and thus become known as dependable partners.
