International-Business-Dr-R-Chandran-E-book

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International Business- Dr. R. Chandran
absolutely necessary for both the venture partners to understand all the
aspects of management, investment and regulations of the countries where
they operate. The business units should have clear guidelines and operation
manuals wherein the role of every one should be clearly defined.
Hence, a joint venture is nothing but a “marriage binding” between two
partners from different backgrounds with an understanding, commitment and
mutually rewarding experience to work together.
8. COLLABORATION
While a joint venture deals with the project in totality, in financial terms and
the proportionate partnership commitments, Collaboration deals with only a
part of the functions. For example Bajaj Auto has technological
collaboration with Kawasaki of Japan, who offers the technology for two
wheelers. Others well known technological collaborations are Ind-Suzuki,
Kinetic-Honda and Hero-Honda. All the developing countries encourage
technology collaborations. The investors in the US, Japan, Germany and UK
enjoyed the fruits by offering technical expertise to the developing nations.
The world famous Kellogg Business School has collaborated with the Indian
school of business (ISB) in Hyderabad, by offering teaching methodology.
Likewise, there may be financial collaborations, HR collaborations, systems
collaborations and strategic collaborations. The common term used for
collaboration is TIE-UP.
9. FOREIGN DIRECT INVESTMENT
The flow of funds from one destination to another is called investment.
Companies, which are constantly involved in international business, invest
their money in manufacturing and marketing bases through ownership and
control. Kellogg, Pepsi, Coca Cola and the Hyatt group of hotels are willing
to invest even if the profits are expected after a long gestation period.
Currently every developing country is formulating strategies by offering
ample amount of incentives to attract investments.
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