Summary
of study by Jeffrey H. Dyer and Benjamin C. Powell, NIST
GCR 00-803.1
Greater trust and information sharing among joint venture members
seem to increase the likelihood of joint venture success.
- Prior experience working together increases the likelihood
that joint ventures will achieve success.
- Joint ventures in which members provide complementary goods
and services (vertical joint ventures) are easier to manage
than joint ventures that include competitors (horizontal
joint ventures).
- Joint ventures with not too many but not too few members
are more likely to work together and collaborate effectively
- Stability in personnel among venture participants increases
the likelihood of success.
- Being located relatively close to each other increases the
likelihood of success.
- In some cases, determinants of joint venture success also
include motivated venture members, a venture member who acts
as a product champion, and/or professional project managers.
Two measures of joint venture success are (1) whether
the project achieved its technical objectives and (2) whether
it produced a commercializable technology or product.
- Other measures
include whether the joint venture:
- generated patents;
- established
important networks of relationships with key individuals
in other firms; and
- generated
benefits that were unanticipated at the beginning
of the project2;
ATP’s
Contribution
This study suggests that ATP contributes to the success of joint
ventures by:
- requiring more upfront commitment from top management;
- fostering
a more goal-directed and organized project through ATP’s
demanding application process; and
- working with joint ventures through difficult periods in
their life cycle while helping them overcome barriers to
collaboration.
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1 This paper examines 18 ATP-funded joint ventures undertaken in the automotive
industry between 1991 and 1997 and is based on informal interviews
in 1999 with participants in each of the joint ventures.
2 Unexpected benefits might
include expanding networks of experts with technical skills in
particular areas, or learning that leads to improvements in products
or processes not directly related to the ATP project. Factsheet
1.E2 (December 2002)
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