Management controls in Sino‐American joint ventures: a comparative case study

Studies the characteristics, control and performance of joint ventures producing a model based on four cases. Explains the theory of complementary strategic objectives, and the need for delineating specific transaction costs and management controls under differing cultures. Interviews managers of four Sino‐American Joint Ventures in manufacturing for several years. Finds that the US partner controlled the technology, the Chinese partner wanted to reduce imports and import management and product skills. Focuses on raw material sourcing as a cause of conflict, as well as slow learning and high transaction costs from a poorly controlled system. Points out the keenness for incentive payments among Chinese workers and the reluctance by Chinese managers to have their performance evaluated.