The effects of strategies on the management control-performance relationship in Sino joint ventures

Many studies of control and international joint venture (IJV) performance have focused on ownership and management control. We develop a conceptual framework to explain how strategies affect the relationship between management control and joint venture performance. Specifically, we focus on serving the host-country customer and extending the life cycle of the foreign partner's products. Using a sample of Sino-U.S. and Sino-Japanese joint ventures, we found that serving the host-country customer strengthens the positive relationship between management control by the foreign partner and IJV performance. However, extending the product life cycle of the foreign partner's products weakens the positive relationship between management control by the foreign partner and IJV performance. We discuss the performance implications of dealing with both strategies and reveal a complex relationship between equity ownership, management control, and IJV performance.