Strains on Partnership Arrangements in Business :: Business Ownership

a.Collaborations importance to rendersOne partner whitethorn give to a greater extent management attention to a collaborative arrangement than the some other does. a. If things go wrong, the agile partner blames the less-active partner for its lack of attention, and the less-active partner blames the more active partner for making poor decisions. The resistence in attention whitethorn be due to the different sizes of partners.b.Differing objectivesAlthough companies enter into collaborative arrangements because they have complemental capabilities, their objectives may evolve differently over time. For instance, one partner may want to reinvest earnings for growth and the other may want to dupe dividends. One partner may want to expand the product argument and sales territory, and the other may see this as competition with its in all owned operations. A partner may wish to sell or buy from the venture, and the other partner may disagree with the prices.c.Control p roblemsBy sharing the assets with another gild, one company may lose most control of the extent or quality of the assets use. When no single company has control of a collaborative arrangement, the operation may lack direction. Studies visualize that when two or more partners attempt to share in an operations management, mischance is much more likely than when one partner dominates. However, the dominating partner must consider the other companys interests. For this reason, studies also show that joint ventures with an flat split in ownership are likely to succeed because the fiscal ownership ensures that management will consider both partners interests.d.Partners contributions and appropriationsOne partners mental ability of contributing technology, capital, or some other asset may lessen compared to its partners capability over time. In almost all collaborative arrangements, on that point is a danger that one partner will use the other partners contributed assets, enabling it to become a competitor. e.Differences in cultureCompanies with different cultures differ in how they evaluate the success of their operations.