Toward Understanding IJV Control: Parent Inside and Outside Control – An Exploratory Case Study

Abstract

Previous studies have failed to recognize the difference between parent control over its ‘own people’ and ‘otherpeople’ in IJVs. The paper for the first time in the literature separates parent control into two modes of control–inside and outside control upon the nature of the relationship between parents and respective IJV managementteams. We examine inside and outside control through an analytical inductive case study. Our result shows thatinside control determined by parent ownership is an endogenous contingent control. It has a broad but selectivecontrol focus. It gives a parent adaptability and flexibility in selecting control extent and mechanisms. Outsidecontrol is determined by parent overall bargaining power. It is a pre-determined control with a narrow specificfocus, and its control extent and mechanisms are predefined. Our study contributes to the literature on IJVcontrol by adding the nature of the relationship between parents and individual management groups into the IJVcontrol equation, unveiling two distinctive forms of control within IJVs.