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Business structure and performance management
Performance management problems in
complex business structures
Type Joint venture Strategic alliance Multinationals
A separate business Similar to a joint Have subsidiaries or
entity with shares venture but a operations in a
What is it? owned by two or separate business number of countries
more business entity is not formed
entities
Agreement of Many of the Co-ordination
common goals problems of joint towards common
and measures ventures apply but goals
more specifically:
Attributing Common systems
accountability Independence may not exist
retained making
Reporting and A host of
Problems sharing establishment of differences, e.g.
planning, information common goals cultural,
measuring and difficult if systems and collection of language, time,
controlling are not integrated information more currency
performance difficult
Quality, cost
control and risk Security of
management information may
tricky due to be more of a
different opinions concern due to
lack of legal entity
Difficult to instil a
climate of trust
Illustrations and further practice
Now try TYU question 3 from Chapter 4 of the Study Text
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