Factors influencing international joint ventures’ performance an investigation into the telecommunication industry in laos (sum)

MINISTRY OF EDUCATION
LAOS NATIONAL UNIVERSITY
MINISTRY OF EDUCATION AND TRAINING
NATIONAL ECONOMICS UNIVERSITY






Thansamay KOMMASITH




FACTORS INFLUENCING INTERNATIONAL JOINT VENTURES’
PERFORMANCE: AN INVESTIGATION INTO THE
TELECOMMUNICATON INDUSTRY IN LAOS
(Business Administration)
Code:
62.34.01.02








A dissertation summary submitted to the National Economics University
in fulfillment of requirements for the degree of

Doctor of Philosophy in Economics













Hanoi, 2014
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CHAPTER 1: INTRODUCTION
1.1 Research Motivation
Lao People Democratic Republic (Lao PDR) is a developing country
that is located in the central part of the Indochina peninsula. The
telecommunication industry plays a significant role in the national
economic development of Laos. In 2008, the telecommunications sector
accounted for approximately 1.6 percent of the total GDP and is considered
one of the fastest growing sectors in Laos.
There are some communication policy studies undertaken by
scholars and media and political organization, but research on International
Joint Ventures (IJVs) in Telecommunication industry in Laos has been
limited. Especially, it seems that very modest attention has been given to

investigate IJVs’ performance and factors influencing it in the industry in
Laos. Thus, these issues are the focus of this dissertation.
Factors influencing IJVs’ Performance in Telecommunication Industry
in Laos
Many scholars and practitioners have conducted research about what
factors affecting the performance of IJVs. However, their research has
mainly conducted in the context of the developed countries (Ren et al.,
2009). Many previous studies (e.g., Hoang & Rothaermel, 2005; Isobe,
Makino, & Montgomery, 2000; Luo, 2001; and Tong et al., 2008) have
examined IJVs performance, which enhanced human beings’ knowledge
about this attractive topic. However, the conceptualization of IJV
performance and factors influencing it remains an often-debated issue in
IJV research (Reus & Ritchie, 2004).
In recent years, more research attention has been given to study IJVs
performance and factors influencing IJVs performance in the context of
developing countries (e.g. Phan & Ngo, 2009; Phan et al., 2006; Cao,
2012) but it seems that very modest research attention has been given to
investigate the impact of these factors in the context of Laos, especially no
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study has examined the issue in the Telecommunication industry in Laos.
In other words, this attractive topic has not been investigated adequately in
the context of Laos, especially in the telecommunication sector.
For facilitating the sustainable development and ensure the success
of IJVs in the important fields like the telecommunication industry in Laos,
it is very essential to have better understanding of the current status of the
IJVs’ performance and investigate the determinants of the IJVs’ success or
failure.
Research objectives and questions

While focusing on the main objective of investigating the impact of
several factors on performance of the IJVs in telecommunication industry
in Laos, this study aims to answer the following questions:
1. What is the overall picture of business performance of IJVs in
Lao’s telecommunication industry regarding different aspects of
performance based on the theoretical framework?
2. What are the key factors influencing the performance of the
IJVs in the telecommunication industry in Laos and what are the impacts of
these factors on the IJVs’ performance?

In terms of the research scope, the data collected for this study
mainly from the three IJVs in the telecommunication industry in Laos.In
terms of timing, the collected data mainly cover recent three years (from
2010 to date). The analyses focus on several aspects of IJV’s performance
and the factors influencing it. The primary data mainly focus on the
perspective from Lao’s partners in the IJVs.

1.2 Theoretical background
This study employs the theoretical background regarding IJVs
performance and factors influencing their performance (e.g., Cao, 2012,
Ren et al., 2009, Bener & Glaister, 2010). On the basis of literature review,
performance of IJVs has been assessed through some measurement
variables, such as: survival, financial output, overall satisfaction,
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achievement of individual or joint goals, and learning.
Many previous studies have identified that IJVs performance has
been influenced by many factors. These factors include control of parent
firms, trust, autonomy, national culture differences, corporate culture

differences (Bener & Glaister, 2010; cf., Ren et al., 2009), commitment,
bargaining power, justice, conflict, effectiveness of conflict resolution,
cooperation, and goal compatibility (cf., Ren et al., 2009).


1.3 Research methodology
This study employed the case study method. Both secondary data
and primary data were collected to develop the three case studies in order
to reflect IJVs’ performance and the factors influencing their performance
during the time of the research. As this study mainly aims to analyze
factors influencing FDI companies’ performance in the selected cases,
multiple data collection methods were used to increase credibility and
validity.
Specific data collection methods used in this study include desk
research (for collecting secondary data), observation, interviews (both face-
to-face and by telephone), and survey (for collecting primary data).


1.4 Contribution of the Study
This study aims to examine several dimensions of the IJVs’
performance and to explore the impact of the key factors on the IJVs’
performance in the context of Lao’s telecommunication industry.
The topic of this study is important and interesting that have
attracted much attention from previous studies.

This study contributes to
the literature pertaining to IJVs’ performance and factors influencing them
in the context of Laos, a developing country that has received very modest
research attention up to date.
The findings of this study help to enrich the knowledge about this

important topic by investigating simultaneously the key dimensions of IJV
performance. Specifically, all five performance dimensions were examined
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in the context of the telecommunication industry in Laos, including
Survival and Longevity of the IJV, Financial Performance/financial output
measures, Overall Satisfaction, IJV’s Goal Achievement, and Learning.
This study also explored the main factors influencing IJV performance
and empirically tested the impact of these factors in four regression
models. In addition, with the case study method used in this study, multiple
data sources were employed including secondary data (i.e., data collected
from internet, company reports, etc.) and primary data sources (i.e., data
collected from observation, in-depth interviews, and survey). This method
was useful and necessary to obtain better understanding the research issues.
Some managerial implications are drawn from the findings of this
study. Specifically, the findings provide IJVs’ managers with knowledge
and insight that would help better understand and manage the determinants
of IJV performance, and therefore help improve performance of IJVs.
This study is expected to provide some implications for policy makers
in an attempt to create a better business environment and to ensure the
favorable conditions for IJVs to achieve better performance in Laos. For
the benefit of Lao’s economy and society at large, the local government
may want to work together with investors (both local and foreign partners)
to jointly develop successful IJVs.

1.5 Organization of the Study
This dissertation includes five main chapters as follows.
Chapter 1: Introduction
Chapter 2: Literature review and conceptual framework

Chapter 3: Research methodology
Chapter 4: Research findings
Chapter 5: Conclusions and discussion

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CHAPTER 2: LITERATURE REVIEW AND CONCEPTUAL
FRAMEWORK

This chapter reviews the literature on IJVs’ performance and the
factors influencing it. In the first section of the chapter, the literature on the
five common measures of IJV performance were reviewed, followed by the
review of the key determinants of IJV performance. Finally, the proposed
conceptual framework is presented.
2.1 Literature review on International Joint Ventures’ Performance
Cao (2012, p.72) noted that although the term IJV has many different
meanings, the most common definition of IJV is “a separately legal
business venture that involves two or more entities with
differentnationalities working together to achieve mutually agreed on
business objectives” (Fogler & Reichert, 2002).
IJV performance has been known as broad constructs with different
dimensions. Ren et al. (2009) reviewed many previous studies on IJV
performance and suggested five common IJV performance measures that
have been employed in the literature, including Survival, Financial Output
Measures, Overall Satisfaction, IJV’s goal achievement, and Learning. The
five main measures of IJVs performance are used in this study and are
presented in details in the dissertation.
Survival and Longevity: refers to the number of years that partners

have been working together in the IJV. In literature, many previous studies
have used Survival or Longevity as one indicator of IJV performance (e.g.,
Dhanaraj & Beamish, 2004; Gaur & Lu, 2007; Lu & Xu, 2006; Meschi &
Riccio, 2008; Steensma & Lyles, 2000). The reason for using this indicator
of IJV performance is that the longer the IJV survives, the more successful
it is. In this study, Survival or Longevity are used together with other
measures to evaluate the IJVs’performance.
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Financial Output Measures: Among many indicators of IJVs’
performance, in the literature the researchers’ interest in employing
financial output measures such as profitability measures (e.g., ROI, ROA)
and market performance measures (e.g., market share) have been
increasing (e.g., Lu & Xu, 2006; Luo, 2002a, 2002b, 2005, 2007a, 2008;
Robins et al., 2002; Zhang et al., 2007; see Ren et al. as well). In this study,
the author decided to employ both objective and subjective measures of IJV
performance.
Overall Satisfaction: Many previous studies have used managers’
subjective evaluations of the IJV’s overall performance (e.g., Boateng &
Glaigster, 2002; Cao, 2012). Since overall satisfaction is a subjective
measure, some previous studies have employed also other objective
measures of performance such as financial outcomes (e.g., Cao, 2012).
Goal Achievement: Achievement of individual and/or joint goals of
an IJV has been used as a measure of the IJV performance (e.g., Phan et al.,
2006; Lyles & Salk, 1996).
Learning: Learning from partners in IJVs has received significant
attention and has been considered as an important indicator for the success
of an IJV (Phan et al., 2006; Lyles & Salk, 1996).

2.2 Literature Review on Factors Influencing IJVs’ Performance
In the literature on IJVs, investigation into factors contributing to IJV
performance have been received much interest from the scholars and
practitioners (Cao, 2012; Rod, 2009). After reviewing past research in the
field, Rod (2009) has summarized the factors that are treated as
independent variables influencing IJV’s performance, and classified them
into two main groups, each factor of which may have direct of indirect
impact on joint venture performance. These factor groups refer to ‘partner
compatibility’ (e.g., organizational culture, management/leadership style,
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strategic match, communication styles, trust, commitment, and propensity
to cooperate), and ‘Socio-Economic factors’ (e.g., opportunity costs,
relative bargaining power, governance/control over JV, and perceived
opportunism).
In the context of developed countries, it has been suggested that the
success of IJVs may be a function of a number of factors. Bener & Glaister
(2010) suggested five main factors influencing IJV performance that have
been given significant attention in the literature as determinants of joint
venture performance. These factors include parent control (Killing, 1983;
Lu & Hebert, 2005), JV autonomy (Hill & Hellriegel, 1994; Lyles &
Reger, 1993; Newburry & Zeira, 1999; Zeira & Parker, 1995), trust
between partners (Madhok, 1995), national culture differences (Brown et
al., 1989; Hennart & Zeng, 2002; Shenkar & Zeira, 1992), and corporate
culture differences (Pothukuchi et al., 2002; Sirmon & Lane, 2004; Weber
et al., 1996).

Besides, based on the review of 54 previous studies in IJV
literature, Ren et al. (2009) showed the model of 10 determinants which
affect IJVs performance in almost cases of developed and developing
countries. Despite being investigated by numerous scholars with different
approaches and models, in this study, the author is interested inexploring
the impact of five main factors that have been consistently identified as
being important determinants to IJV performance and they are also
relevant to the context of Laos, namely Control of the IJV, Trust,
Cooperation and Commitment, Culture differences, and Goal
compatibility. Each factor are discussed in details in the dissertation.

2.3 Conceptual Framework
On the basis of literature review and suggestions from the
interviews with IJVs’ managers, five measures/dimensions of IJV
performance and five factors are employed in the research model.
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Figure 1: A Conceptual Model for Studying Factors influencing
International Joint Ventures’ Performance

Cooperation & committment
Trust
Cultural differences
Control


Goal compatibility
IJV Performance
Survival/longevity

Financial performance

Overall satisfaction

IJV goal achievement

Learning

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CHAPTER 3: RESEARCH METHODOLOGY
The overall research objectives of this dissertation are to evaluate the
current status of IJVs’ performance and to understand the factors and their
impact on performance of the IJVs in the telecommunication industry in
Laos. In order to achieve the set objectives, the case study method was
employed. This research used both secondary data and primary data
sources. Multiple data collection methods were employed, including
interviews, field observation, and survey.
In this study, three cases – three IJVs are investigated. This is the
main source of information providing insight in Laos telecommunication
industry’s IJVsperformance dimensions and the key factors influencing
their performance. In this research, primary data for the case studies
included both qualitative and quantitative data. For collecting qualitative
data, observation and in-depth interviews methods were employed to
explore the overall picture of the IJVs performance, especially from the
IJVs managers’ perceptions. In addition, several key factors that may
influence the IJVs performance were explored. The qualitative findings
also help to confirm the theoretical framework that was tested using the
survey data.
Qualitative data collection

Observation
For each IJV in this study, the author visited the IJV’s office in
Vientiane at least 3 to 4 times per year as business visits. In addition,
sometimes the author visited selling stores of the IJVs in provinces in Laos.
For LTC, the author attended the meetings with the IJV’s top and middle
managers every 3 month. For Unitel and Beeline IJVs, the meetings were

less frequent. During the visits and meetings, the author, based on
observation, collected data including content of the observed activities and
emotional reactions such as the sense of comfort, frustration, stress, or
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happiness (Nguyen, 2005). The focus of the observation was on the cultural
differences between the partners, trust between the partners, and
cooperation. The expression of satisfaction of each partner in the IJVs was
also observed.

In- depth interviews

For the interviews, all three IJVs operating in Telecom industry in
Laos were selected for investigation. The author used one-to-one
interviews, both face-to-face and telephone interview. The interviews were
carried out in Laotian. Total of 10 interviews from three IJVs were
conducted: 6 with LTC’s managers, 3with Unitel’s managers, and 1 with
Beeline’s manager. Each interview average lasted for 30 minutesfor face-
to-face interview and lasted for 10-15 minutes for interview via phone.
Survey data collection
In order to test the hypothesized relationships in the research model
we employed the survey data collected from 03 IJVs in the
telecommunication industry in Laos.
Measures and questionnaire development
In the survey, the author employed the scales measuring IJV
performance and the factors influencing it. These measures were adopted
and modified from past research while taking into account the suggestions
from the qualitative study.

IJV performance: In addition to the question ‘How long have your
IJVs been established?’ to measure longevity/survival dimension of
performance, the scale items developed by Lyles and Salk (1996) and an
item from Cao (2012) were adopted and modified to measure ‘financial
performance’, ‘overall satisfaction’, ‘goal achievement’, and ‘learnings’.
Factors influencing IJV’s performance:
• Trust: four items were adopted from Nguyen (2005);
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• Cooperation and commitment: four items were developed based on
suggestions from past research and the qualitative study;
• Control mechanism:four items were adapted from Cao (2012);
• Cultural differences: four items were adapted from Simonin (1999);
• Goal compatibility: two items were adapted from Ren et al. (2009).
Sample
A survey was conducted in three IJVs in the telecommunication
industry in Laos. Total of more than 200 questionnaires were sent to top
managers, middle managers and senior staff at three IJVs, and 87
completed and usable questionnaire were used for final analyses: 31 were
from LTC IJV, 30 were from Beeline, and 26 were from Unitel.
Data Analysis
For the survey data, in order to test the proposed relationships in the
research model, several multiple regression analyses were employed.
Dependent variables were different dimensions of IJV performance,
including financial performance, overall satisfaction, goal achievement,
and learning. The independent variables in all these regression analyses
were the five factors that were proposed to have impact on performance.
Before testing the hypothesized relationships, we performed

exploratory factor analyses (EFA) and assessed the internal reliability of
the scales used in this study, using coefficient alpha. While the focus of this
study is to test the impact of several factors on IJVs’ performance, some
descriptive analyses and comparisons among the three IJVs were also
conducted.

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CHAPTER 4: RESEARCH FINDINGS

4.1 The Current Status of IJVs’ Performance in the Telecommunication
Industry in Laos
4.1.1 The Telecommunication Industry in Laos
According to report of MPT (2011), Laos has five key providers
namely: Lao Telecommunications Corporation (LTC), Enterprise of
Telecommunications Lao (LTL), Beeline (Vimpelcom), Unitel (Star Telecom)
and Sky Telecom (Laosky). BMI (2013) has projected that the performance of
Telecom sector in Laos will increase slightly until 2017
4.1.2 Performance of the IJVs in the Telecoms Industry in Laos
Currently there are five telecoms service providers in Laos, of which
there are three IJVs. In the following section, performance of the IJVs are
presented following some key performance dimensions.

4.1.2.1 Performance of LTC
LTC was established in 1996 as an IJV with 51% share of Laos’
governmentand 49% of Thai investor. LTC is the IJV which has the longest
operation time in the telecoms industry in Laos (nearly 20 years). LTC has
been always the market leader, even in the highly competitive environment

over the recent years.
In terms of market share, LTC accounted for 44.2% of the mobile
service market in 2012. In the fixed-line market, LTC has also accounted for
the largest market share over the last few years. In the broadband internet
market, LTC together with ETL are the two biggest service providers.
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In terms of turnover/revenue, LTC achieved more than 600bn LAK in
2011, more than 700bn in 2012, and more than 800bn in 2013. The annual
growth rate was more than 15% in the period 2011-2013.
From the perception of LTC’s managers and senior staff, the findings
from the survey show relatively high level of performance in all dimensions
(i.e. financial performance, overall satisfaction, goal achievement, and
learning). The mean values ranged from 3.75 (for learning) to 4.35 (for goal
achievement.
4.1.2.2 Performance of Star Telecom (Unitel)
The IJV Star Telecom or Unitel was established in 2007 with 51% share
of Laos’ governmentand 49% of Viettel Global from Vietnam. Together with
LTC, Unitel currently are leaders in the telecoms market in terms of revenue
and the number of subscribers. Unitel has more than 6 years of operation in
the telecoms industry in Laos. Although it is still a relatively young IJV,
Unitel has obtained significant achievements over the past few years and has
set a solid foothold in Laos’ telecoms market.
In the mobile phone market, only 3 months after officially launching the
service, Unitel achieved market share of 19%, holding the 3
rd
position in Laos’
market. According to LTC’s data, Unitel accounted for 36.1% of the

mobilephone market at the end 2012.
In the fixed-line market, Unitel officially launched Unihome service in
December 2009 and at first its market share was 4%. However, ony 7 months
later Unitel’s market share was 14%, holding the 2
nd
position in the market.
In April 2010, Unitel also officially launched internet service in Laos
and accounted for 14% of the market share, holding the 2
nd
position in the
market (after LTC). On 15 October 2010, Unitel launched 3G service in 17/17
provinces (Nguyen, 2012).
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In terms of turnover/revenue, Unitel achieved more than 400bn LAK in
2010, sharply increased to more than 800bn in 2011, and significantly
increaded to more than 1tn in 2012 and 2013. The average annual growth rate
was impressive especially in the period 2010- 2012 with great amount of net
profit (almost twice every year in this period of time).
Contrary to the data from the financial reports of Unitel, the perceptions
of Unitel’s managers and senior staff (the findings from the survey) show
relatively low level of performance in all dimensions. The mean values ranged
from 3.11 (for Financial performance) to 3.92 (for Learning). The survey
findings are discussed in the discussion part of the dissertation.
4.1.2.3 Performance of Beeline
In 2003, Millicom (Tigo) together with Laos’government established an
IJV with 78% of share belongs to Millicom and 22% of share belongs to
Laos’government. In Septemebr 2011,VimpelCom Ltd. (Beeline), a leading

telecoms service provider in Russia officially announced to buy Millicom
Laos Co., Ltd. VimpleCom currently holds 78% of share and Laos’
government holds 22% of share. The brand Beeline replaced the brand Tigo.
Therefore, Beeline seems to be young in terms of number of operation years in
Laos market.
Beeline have been facing with difficulties in the competitive market.
The number of mobile service subscribers had continuously reduced through
out the year 2012. In the mobile phone sector, Beeline held 8.7% market share
in October 2011. However, one year later in 11/2012 Beeline only held 5%
market share.
Regarding the performance dimension of learning, similar to the other
two cases the qualitative findings confirmed that both partners in the IJV
could learn from each other.

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With regard to the perceptions of managers and senior staff on the IJV’s
performance on several criteria, the survey findings seem to be more positive
than the real status. All the mean values are a bit higher than the average score
(mean values around 3.5). These findings are also discussed in the
dissertation.
With regard to general evaluation of the performance of all three IJVs in
Lao’s Telecommunication Industry, the survey findings

showed that all
performance dimensions were perceived to achieve at a bit higher than
average level. The mean values ranged from 3.56 for financial performance to
3.78 for goal achievement.

4.2 Factors Influencing IJVs’ Performance in the Telecommunication
Industry in Laos
4.2.1. Identification of Factors Influencing IJVs’Performance
In this summary of dissertation, the author mainly reports the findings
from the survey of 3 IJVs in telecommunication industry in Laos.

Dominant Control of the IJV
When examining the current situation of the control mechanism at the
three IJVs, the survey findings showed that the control mechanism at LTC
was highly evaluated (mean = 4.06), followed by Unitel (mean = 3.43) and
Beeline (mean = 3.37). ANOVA analyses provided empirical evidence for
significantly more appropriate control mechanism at LTC compared with it
at Unitel and Beeline (p < .01).
Trust, Commitment and Cooperation
The survey findings showed that although the level of Trust at Unitel
was relatively high (mean = 3.96, the highest score among the three IJVs) the
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Cooperation and Commitment between the partners at Unitel was only at the
modest level (mean = 3.33). There may be some reasons for this fact and this
are discussed in the discussion section.
At Beeline IJV, both Trust and Cooperation and Commitment were
perceived at the average levels (mean = 3.56 and 3.42, respectively). The
results of ANOVA analyses showed thatthere was no significant difference
among three IJVs regarding the levels of Trust (p > .05). However, the level
of Cooperation and Commitment at LTC was found to besignificantly
higherthan it at Beeline and Unitel (p < .05). There was no significant

difference between Unitel and Beeline in terms of level of Cooperation and
Commitment (p > .05).

Goal Compatibility
The survey findings showed that both Unitel and LTC were perveived
to have high levels of compatibility of goals (mean = 4.10 and 3.92,
respectively). Beeline was perceived to have just a bit above average score of
goal compatibility (mean = 3.45). The results of ANOVA analyses showed
that there was no significant difference between Unitel and LTC in terms of
goal compatibility (p > .05). However, both Unitel and LTC showed
significantly higher level of goal compatibility compared with Beeline’s (p <
.05).

Cultural Differences

The survey findings showed that the Cultural Differences seemed to be
no problem at LTC (mean = 2.47). For Unitel and Beeline, Cultural Distance
was perceived at average level (mean = 3.41 and 3.34, respectively). The
results of ANOVA analyses showed that Cultural Distance was significantly
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larger at Unitel and Beeline compared with it at LTC (p < .01). There was no
significant difference between Unitel and Beeline with regard to Cultural
Distance (p > .05).
4.2.2 The Impact of Several Factors on IJVs’ Performance - Regression
Findings
4.2.2.1 Measurement Properties
Measures of IJV’s performance (dependent variables)

The multiple-item scales measuring different dimesions of IJV’s
performance were first subjected to EFA (PCA using Varimax rotation with a
criterion of eigenvalue greater than 1.0) to test the construct’ underlying
dimensions and to look for a more parsimonious set of variables for
subsequent analysis. The reliability of each scale was assessed using Cronbach
coefficient alpha. The results confirmed the reliability and initial validity of
performance measures.
Measures of factors influencing IJV’s performance (independent variables)
To assess the perperties of the scales measuring IDVs, the author again
used Cronbach coefficient alpha and conducting EFA. First, all the items
measuring five factors were subjected to EFA and five factors were extracted
as expected. The five-factor solution explained 75.59% of the total variance of
which Factor 1 (Control Mechanism) items accounted for 20.1%, Factor 2
(Trust) items accounted for 19.4%, Factor 3 (Cooperation and Commitment)
items accounted for 12.7%, Factor 4 (Cultural differences) items accounted for
12.7%, and Factor 5 (Goal Compatibility) items accounted for 10.7%. All the
alpha have the values ≥ .70 that confirm the reliability of the scales.
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4.2.2.2 Regression Results
To test the impact of the proposed factors on the IJVs’ performance, the
author ran four multiple regression models, in which dependent variables in
the four models were four dimensions of IJV performance.
The results of multiple regression analysis with Financial Performance
as dependent variable showed that IJV’s performance was explained
significantly by the factors. The regression model was found to be significant
(F = 15.37, p < .01), accounting for 46% of the variance in the data.
Specifically, the regression results confirmed the significant impact of

Cultural Differences, Control Mechanism, and Cooperation & Commitment
on IJV’s performance: β= 26, p < .01; β= .31, p < .05; and β = .29, p < .05,
respectively. However, Goal Compatibility and Trust were not found to be
significant predictors of Financial Performance.
The regression results with Overall Satisfaction as dependent variable
showed that the regression model was found to be significant (F = 5.9, p <
.01), accounting for 23% of the variance in the data. Among five factors, only
Cultural Differences had significant negative impact on IJV’s performance: β=
41, p < .01. Other factorswere notfound to be significant realted to Overall
Satisfaction.
The regression model with Goal Achievement as dependent variable
was found to be significant (F = 15.05, p < .01), accounting for 45% of the
variance in the data. Three out of five factors(i.e. Control Mechanism,
Cultural Differences, and Cooperation & Commitment) were found to be
significantlyrelated tothe performance dimension of Goal Achievement:
β=.50, p < .01; β= 23, p < .05; and β = .22, p < .10, respectively.
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The regression model with Learnings as dependent variable was also
found to be significant (F = 13.77, p < .01), accounting for 43% of the
variance in the data. In this model, the significant impacts of Trust, Cultural
Differences, and Cooperation & Commitment on Learnings wereconfirmed:
β=.49, p < .01; β= 19, p < .05; and β = .27, p < .05, respectively. The data
did not support the relationships between Control Mechanism and Goal
Compatibility with Learnings (p > .05).
Briefly, in all four regression models Cultural Differences consistently
showed significant negative impact on IJV’s performance dimensions as
expected, while Goal Compatibility was not found to be significant predictor

in all the models. The significant positive impact of Cooperation &
Commitment was found in three models, while the Control Mechanism
showed its significant contribution in two models and Trust in only one
model.
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CHAPTER 5: CONCLUSIONS AND DISCUSION
5.1 Conclusions
The main purpose of this study is to examine several dimensions of
the IJVs’ performance and to explore the impact of the key factors on the
IJVs’performance in the context of Lao’s telecommunication industry.
Among the three IJVs, the performance of LTC, an IJV with the longest
time of nearly 20 years operating in Laos market, were generally suggested
at relatively high level in all the dimensions. Next, Unitel, the IJV with just
over five years operating in Laos market, was considered to make some
great success within a short period of time. However, due to some reasons,
the performance of this IJV was perceived by the managers and senior staff
at the IJV to be at just modest level in all dimesions (just around the
average score). Meanwhile, Beeline is an IJV which has experienced the
transformation of the ownership during the operating time in Laos market.
The performance of this IJV seems not very positive in terms of financial
output measures. However, the various performance dimensions of this IJV
was perceived not really negative (still a bit above the average level).
With respect to the factors influencing the IJVs’ performance, the
qualitative findings suggested five main factors including Control
Mechanism, Trust, Cooperation and Commitment, Cultural Differences,
and Goal Compatibility. However, the survey findings did not support Goal
Compatibility as a significant predictor of the IJVs’ performance. In the

meantime, Cultural Differences consistently showed significant negative
impact on all four IJV’s performance dimensions, while the rest factors
(i.e., Cooperation & Commitment, Control Mechanism, and Trust) were
confirmed as determinants for some performance dimensions.
5.2 Discussion and Implications
The findings from different data sources seem to provide some
inconsistent results regarding performance of the two IJVs: Unitel and
Beeline. Several possible reasons are provided for explanations. In this
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study, the factor of Goal Compatibility was not found to significantly
contribute to IJV performance. This may be need further investigation in
the future research.
This study is expected to provide some implications as follows.
Theoretical Implications
This study contributes to the literature pertaining to IJVs’
performance and factors influencing them in Laos, a developing country
that has received very modest research attention up to date. The findings
help to enrich the knowledge about this important topic by investigating
simultaneously the five key dimensions of IJV performance.
This study also explored the five main factors influencing IJV
performance and empirically tested the impact of these factors in four
regression models. In addition, with the case study method, multiple data
sources were employed including secondary data and primary data sources
This method was useful and necessary to obtain better understanding the
research issues.
Implications for the IJVs
The findings from this study regarding the current status of the

industry and the IJVs’ performance suggest that Laos is still promising
telecoms market for IJVs to explore.
This research identified some key factors which have effects on
IJVs’ performance in Laos. In some cases, there are some factors have
stronger effect than the others. The research findings suggest that
developing an appropriate control mechanism within the IJV can contribute
to the better IJV’s performance. In addition, once foreign partners in IJVs
deeply understand their invested market and culture differences, they can
make clearer plan and avoid mistakes or misunderstanding, so they can
gain greater success.
Besides, managers in IJVs should learn how to build trust between
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the partners. Good cooperation with and high commitment to the partner
and the IJV’s objectives can contribute to better IJV’s performance. Better
communication, consultation with partner and well formulated rules and
operating practices can help avoid conflict.
Implications for Policy Makers
This study is expected to provide some implications for policy
makers in an attempt to create a better business environment and to ensure
the favorable conditions for IJVs to achieve better performance in Laos.
For the benefit of Lao’s economy and society at large, the local government
may want to work together with investors (both local and foreign partners)
to jointly develop successful IJVs. For example, Cultural Differences were
found to be an important barrier for the IJV’s success. Policy makers may
need to do some activities to reduce the distance in terms of culture by
helping the foreign investors to understand better the national culture and
facilitate their better understandings of the corporate culture in the host

country.
5.2.2 Limitations and Future Research Directions

Limitations of the research
• The scope of the study was limited to a single country –Laos, and in an
industry – telecommunication industry.
• The modest research sample size: All three IJVs in Laos
telecommunication industry were surveyed for this research, with 87
respondents drawn from these IJVs.
• Respondent bias: The top and middle managers and the senior staff of
the IJVs were the key sources of information. The portion of senior staff
in some sub-samples are more salient than other that may lead to some
bias in the results.
• The lack of experience of many respondents in participating in a survey.
• Some scales used in this study include only one or two items.
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Future Research Directions
• A replication of the study in other developing countries contexts is
suggested to provide a wider sample and increase generalizability of the
findings. It would be also interesting to conduct a study in the context of
more variety of the industries.
• Future research with a larger sample would be necessary and useful for
the analyses of the explanatory variables’ impact and for more
meaningful comparison results. In addition, for more complete results,
future research should include the representatives of both IJV’s partners
and the parent companies in the research sample.

• Using multiple item scales are always desirable. Future studies may
want to develop and use more items to measure Goal Achievement and
Goal compatibility.
• Future research can be directed to include other factors as potential
predictors of IJV performance such as conflict, Conflict Resolution, and
justice.
• A longitudinal study can be conducted to explore the relative strengths
of the determinants of joint venture performance over an extended
period of time.