Collectivist values for constructive conflict management in international joint venture effectiveness

Abstract

Purpose This study aims to identify mechanisms to manage conflicts that occur when organizations with different cultures, habits and experiences try to coordinate effectively in international joint ventures (IJV). This study proposes that partners can promote their joint venture performance to the extent that they rely on cooperative rather than competitive conflict management. This study further hypothesizes that adopting collectivist values strengthens relationships and thereby provides a foundation for cooperative conflict management. Design/methodology/approach The authors collected data for this study in Shanghai, which is currently the most attractive province in China for FDI (FDI Intelligence, 2014). In all, 75 pairs of foreign and Chinese managers at middle and senior levels, knowledgeable about the joint venture relationships, completed their respective questionnaires. Findings Results of the structural equation analyses support the hypotheses that collectivist values support cooperative conflict management that in turn facilitates joint venture learning and performance. In contrast, individualistic values promoted competitive conflict management which in turn frustrated IJV performance. Practical implications Results suggest that IJV managers can strengthen their venture by developing collective values and training such cooperative conflict management skills as self-expression and demonstrating understanding of opposing views. Originality/value This study directly documents that while conflicts may interfere they can also stimulate discussions and decisions that promote coordination and performance of IJVs. This study contributes to conflict management research that has largely focused on investigating the consequences of approaches by examining conditions that promote constructive conflict management approaches.