Joint Ventures Dominate The World Economies

Published Date: 02 Nov 2017

Joint ventures dominate the world economies (Morck and Yeong, 2004). However, organizational structures tend to focus on non family firms, limiting the generalization of findings and representation of the business population (Dyer, 2003). In a joint venture, relationships are involved in family issues and a business issues. It is impossible to separate both familial relationships and business relationships. Within the overlap of different domain, conflict is an important issue in joint ventures. The ambiguities between the boundaries of family and venture, conflict is inevitable in joint venture setting. One of the issues that joint venture face is the role conflict among family members owing to the multiple roles and activities that deriving from being both family and joint venture members. Thereby, fulfilling the demands of one role might undermine the second role while the tension associated with one role can extend into the other one. Managing role conflict among family members is a critical task in joint ventures since they highly depend on retaining and keeping family members for the purposes of trans-generational succession and long-term survival. Within the overlap of different domain, conflict is an important issue in joint ventures. The ambiguities between the boundaries of family and venture, conflict is inevitable in joint venture setting. For example, conflicts in family sphere, such as marital conflict or sibling rivalry often spill over into the business domains. Conflict among family employees is known to play a role in joint venture’s performance. It can posses a very antagonistic image of the venture into the market as well as within the organization itself. The joint venture context offers an interesting flap between venture and family realm, creating an exclusive mix of communication and behavioral patterns amongst family co-workers. Many joint venture problems are born from the issues within the family. Family co-workers should avoid conflicts, as it is very common and find the best solution to resolve them. The goal of a joint venture may contradict with the absolute target of the family. For example, usually the target of any business is to make profit and provide certain return against capital to the owner and invertors. Whereas, conventional family goals may accommodate support, love, emotional ties, respect and kindness. Endowing parents often wishes for all their children to get backing from the joint venture ignoring the non-exertion of all except one or two siblings in the venture. This factor usually creates ardent situation if the venture and family goals are not clear and accorded. Common theme of joint venture conflicts when one family co-worker takes decision on firing the other family co-worker. If this sensitive situation is not solved quickly, the problem intensifies and affects the venture. At times family holds greater importance than the venture. When the co-workers are finding difficulties in copping up with each other even on trying their best, one should have to acquire the other. This is an emotional situation because according to the selling side there is more value in the venture compared to those who remain. This query confounds a sense of betrayal and lead to mistrust which usually determine these sorts of conflicts. Common conflicts between siblings that burst into venture argument is when sister or brother disagrees with one another, or when one is given more authority than other. These clashes can also turn into violence, as once occurred a fistfight between two members of the famous Gucci family, well-known for its fashion designs, at getting fired by his uncle at the board meeting. Most of the times, family members feel that their hurt and anger leaves them no choice except what they are doing or appear helpless to resolve conflicts. While some families just simply avoid or deny conflict, taking along their hurt feelings and resentments with them to endless disagreements and in family meetings. The constancy and significance of the conflict in a joint venture stem from the fact that joint ventures are comprised of a exclusive type of venture. Family members, having a personal and biological history, in order to become business partners and colleagues they try to get in the good elements of their relationship. But family system theory explains that the excursion from family to office is abounding with downfall. Psychiatrists Murray Bowen and other family structure theorists have estimated that a family can be understood better as a single conjoin whole, not as autonomous individuals and a group of separate. In other words family, is a system more like attorneys in a law firm fish in an aquarium. Joint ventures should clearly define boundaries and rules of membership. As defining business roles for every family co-worker is essential part of a joint venture. Obviously these are up for discussion and can be flexible when they need to be, but it often works better to decide in advance which person is ultimately responsible for getting which things done. This will specially create less marital conflict if the spouses are working together in a joint venture. Mostly the spouses working in a joint venture tend not to follow certain boundaries in business. Personal indoor matters may reflect for instance in decision making. It is important to have separate interest outside work and agreeing on how you’ll relate to each other in front of others is a plus. If the spouse is not physically or practically involved in the joint venture then the business is not at all affected by their personal differences. Yet again building boundaries in a joint venture is very important to avoid conflicts. Joint ventures do not have a set of formal rules and procedures for how the family co-workers will interact and function with each other. For example, there might be a rule of not saying anything negative to each other or assuming all family co-workers to be perfect. They are often afraid of change and restrain efforts to implore change. The family’s early year’s emotional reality remains, even till the children become adults. Many family conflicts starts from the early stage. Many of us grow up thinking what we should receive from our parents which is an unrealistic expectation. A son may expect to inherit or share ownership of the family business, while his brother may have worked for many years in the company with the expectation that some day it will be his alone. When the younger son enters the business, a clash is inevitable. These expectations become magnified in a joint venture where large amounts of cash and other assets are to be equitable distributed at some point. Venture has a hierarchy, with unwritten and often unspoken roles and tasks. Role in joint venture demand different behaviors compared to home, as the family hierarchy often gets transferred to the business. It gets harder to take orders from one another. The family’s business is often incompletely spate from the family system. It is extension of the family system and its rules and patterns. If the family pattern of functioning supports sound business practices, there is no problem. But when the family pattern is antithetical to prudent business management, the joint venture is in danger. If everyone feels entitled to take out lots of money or receive generous perks, financial difficulties are likely to spring up. Problems develop when a pattern is transferred from a family into a business. For example, one group of siblings extended the pattern of taking care of their younger brother, the baby in the family, when he entered their company. His elder brother will not give him real responsibilities and not expect very much from him. Thus, this family pattern will have damaging effect on the business and emotional conflicts will occur. In times of crisis, relatives in business together can behave in ways shockingly. When family finds itself in trouble, its members rarely look to themselves as a unit to find the remedy. The family either blames one individual who exhibits behavior that goes against the family’s rules- which may or may not conform to society’s rules- or they blame an outside agency, the tax system or their adviser. Though this may prove to be an effective way to keep relatives from seeing their own role in the problem, it is not an effective way to remedy for family conflicts. Creative families also tend to integrate the family method of communication into their venture relationship. If the family co-workers have habitual complaining nature and discuss work affairs with their mother when they are offended by their father, this model may continue even if father is the CEO of the venture or siblings are in managerial position, and mother has no concerned in the business. When they disagree with father, the young manager may talk to the mother, who in turn berates father in private for his assumed tactlessness. This violates the border line between the business and family and shifts business disagreements to the family. In a friendly situation, if the third person is aware of the problem, they express their perceptive and advise an individual that he/she should get back to the person had problem with and try resolving it together. To avoid conflict from interaction deficiency, communicating openly and directly is necessary with the person one doesn’t agree with and discuss their contradicting opinions and expectations or agonize feelings. It does not mean that every affair is accepted or every person has authority of determining a decision. But, if there is disappointment with any family co-worker’s performance, it’s better to discuss the ways and deficiencies to correct them, rather than sending termination letter without any warning. Such decay of communication has illuminated many destructive and long family conflicts and arguments. Every business faces the issue of ineffective communication in every aspect of life. Communicating effectively is analytical to the success of any relationship in family or in business. Venture having non-personal, non-familial context which is straight forward and simple becomes a challenge for the joint venture (family business) to run a frequently charged emotional context an overwhelming task. Deficiency in communication between the family co-workers creates problems, to overcome them it’s essential to set some simple and non-negotiable rules, and communicating in family meetings occasionally. Poor communication and intensifying issues between the family co-workers are like a cancer in a joint venture, and they must be dealt with care as possible as in can be. It has been proven in the past that the issue of poor or nonexistent communication is one that can take a joint venture down the hill more rapidly and more dramatically than any other. Trust is crucial yet again very essential part of family and business flow. Research has advised that trust may expedite team work and alliance, provide the foundation for constructive working and family bonds, relate to employee character and job satisfaction, and support customer satisfaction and adherence (Donna M.Romano, Louisiana State University dissertation, May 2003). In joint venture it’s not easy to know whether family co-workers have trust on one another, its unpredictable. It’s generally much easier to perceive it by heeding the attitudes and behaviors that appear when the trust has been a drifted. "Trust" is predicated upon healthy relationship of family co-workers with each other. In joint ventures the basic and main requirement of building and retaining trust is by maintaining cohesiveness. And the skill to grasp meaningful trust conversations to resolve arising conflicts between family co-workers and stay together. This is never truer than during times of succession. Usually joint ventures (family business) believe that formal structure is not important because they love each other. But, a structure should be developed to maintain trust in family co-workers as they are in business as a whole. Unlike orthodox businesses, the joint venture consists of unifies relationship between family and business that makes it difficult to discrete home life from work life. Team work is extremely important and difficult part of any organization. Although, some people have the talent of working alone better, but results can be achieved in higher standard with the support and effort of a team as a whole. Any king of business that fails to understand the importance of team work leads to errors and leave itself exposed to miscommunication. One man show or single effort in joint ventures may not be productive as it can be by team work of fami9ly co-workers, as a famous saying state that two is much better than one; a cord of three cannot be broken. An individual can get a lot of work done, but it’s quite unrealistic to expect from a single person to know everything and get everything done without any help or suggestions. In a joint venture it’s very difficult for a single person to put all his effort while others family co-workers are just a part of profit sharing. If only one family co-worker’s effort and hard work is involved in the business then naturally expectations to get maximum is more from the profit and authority compared to other family co-workers. This creates a gap and conflicts between the family co-workers and destroys their personal and family relationship equally. Family co-workers as a team can do more than just getting the work done. When the team works well together they can retain some of their brightest stars within. A single family co-worker cannot contribute the overall functioning of the organization. For example, in cricket: no matter if the team has a great wicket keeper or pitcher on the ground but if the fielders doesn’t know what’s going on, then the team is never going to win the title of world series. Likewise, a venture to run smoothly with profit, combined effort and support is important.

The infrastructure of a good relationship is build upon honest and open communication. Usually is miscommunication is biggest problem. And working on this factor can concrete the way towards improved relations. Family co-workers must be willing to discuss issues that might be controversial or touchy. Avoidance to the problem only makes it worse. Silence agreement is equally damaging just to keep the peace. Ways should be figured out to disagree without criticizing aggression towards the other party. Communications is always built upon honesty, or else the other party can have misconceptions which will eventually ruin the relationship more that the initial confrontation. About 70% of all communication is non-verbal. One expression may deny their words and arise a question on the communication being honest. One’s pitch of voice often delivers more than what is said. Sarcasm, doubt, superiority and anger must always be removed from the speech. Listening actively is another important part of good communication abilities. Explore to understand relatively than be understood, a good principle to follow in relationship building. Like a building constructed on a defective base, relationships that do not start with open and honest relationships are doomed to crumble. The attitude one dominates goes a long way towards building collective perfect or broken relationships. Again, attitude is usually determined by expressions and actions no matter what one say, actions speak louder than words. Genuine interest and attention in family co-workers will stimulate them to determine the same in return. In order to have a healthy relationship with others one must stay in contact. Bonds between family co-workers strengthen by spending more time together, especially at time out of office. Be sure of making an accord of not to discuss any business issue during family gatherings. Doing different social activities together is equally significant as working together. Social activities usually help one to understand the other co-worker and learn more about the different areas of his or her life personally and factor that affect them. Vice-versa, if all activities are in informal horizon it gets crucial to measure a person’s performance in a working horizon. Importance of balance imply here like all other areas of life. If a family denies having conflict between them is either in serious dismissal or else they have a fear to disagree or any other fear which will lead them to serious relationship crisis in the future. A healthy family discussion can be done on how to resolve the conflicts when they do occur. The top most essential part which keeps the joint venture working is trust. Trust is something one earns with time. Trust can easily be broken by mistreating others, conflict, dishonest communication and other actions done intentionally or unintentionally. Once trust is broken it is very hard to repair, so being trustworthy at all possible times is very important. One more important factor is forgiveness; one must be content to step towards the relationship, realizing that retaining trust might take a while to repair. These factors can improve existing co-worker relationship and help them build new relationships and welcome other family co-workers. Keep in mind that none of the ventures is perfect, so one must constantly work to build goodwill t and improved relationship. Families that live together and work together are equally compulsive on both the family and the venture. Healthy relationships will mortar the success of both.