Wuhan Erie Polymers Joint Venture
Wuhan Erie Polymers joint venture
ERIE speciality chemicals was a company which is based in Cleveland, Ohio, which moved to china due to the key support provided by them in expanding their industrial capacity relating to chemicals. In order to expand its production in China performance polymers had merged with Wuhan plastics factory to form Wuhan Erie Polymers (WEP). Stanley Wong was the manager of the team that negotiated the joint venture and soon became general manager and then chairperson of the Joint venture. Though he was very pleased with his transfer back to Gary, he wasn’t finished yet. He wanted to nominate a successor who would take the company to another …show more content…
These joint ventures have been reported to suffer from communication, cooperation, commitment, and conflict-resolution problems caused by partners value and behaviour differences, which in turn causes interaction problems that adversely affects the joint venture performance. Moreover, value and behaviour differences between culturally distant partners influence interpretations and responses to strategic and managerial issues, compounding difficulties when making transactions and sharing information in international joint ventures (Mohr and Spekman, 1994).
There are two types of cultures that directly affect the joint venture, first one is the organizational culture and second one is the national culture. Lane and Beamish (1990) stated that the problem in IJV’s is due to the influence of the national culture on the behaviour and management system that leads to conflicts and differences in the workplace. The organizational culture plays a significant role in the flow of knowledge within the organization but at the same time it can also act like obstruction in the process (Almeida et al. 2002). The national culture evolves around societal norms consisting of values which are shared by major part of the population. Once, a system has been developed it is very hard to change and any variation in the institution does not affect the societal norms due to the deeper levels of values