derick thesis-all

JOINT VENTURE CONTRACTING RELATIONSHIPS

BETWEEN FOREIGN AND LOCAL CONTRACTORS

IN THE CONSTRUCTION AND ENGINEERING INDUSTRY

OF HONG KONG:

IMPLICATIONS FOR UNDERSTANDING COLLABORATIVE PRACTICE

By

Derick S. Johannes

Diploma of Quantity Surveying, RMIT University, Melbourne

Master of Business Administration (MBA), RMIT University, Melbourne

Post-Graduate Diploma in Arbitration, CEM, Reading,UK

Fellow of The Australian Institute of Quantity Surveyors (FAIQS)

Member of The Chartered Institute of Arbitrators (United Kingdom; MCIArb)

This thesis is submitted in fulfilment of the requirements

for the Degree of Doctor of Philosophy

undertaken at the RMIT University, Melbourne.

November, 2004.

ii

© Copyright by Derick S. Johannes 2004

All Rights Reserved

iii

Dedication

This doctoral thesis is dedicated to several people who have greatly assisted in the

successful completion of this research. Throughout the course of my postgraduate

education, I am indebted to the ceaseless support and encouragement of my beloved

wife, Mary Elizabeth, and my four children, Ewan, Sophia, Simon, and Emma. Further,

I would like to express my sincere and deep appreciation for the invaluable assistance

offered by Professor Derek H.T. Walker in promoting the knowledge-based importance

of this research in terms of subsequent joint venture success, together with making my

postgraduate education very rewarding.

iv

Abstract

The purpose of this research was to develop a cultural understanding of the varying

knowledge-based managerial and inter-organisational practices between local and

foreign-based contractors in engendering competitive advantage within large scale

infrastructure projects being conducted in Hong Kong. To achieve this objective, two

separate, yet interrelated studies, were conducted.

In Study One, based on exploratory interviews which were conducted with nine senior

level executives involved in major infrastructure projects in Hong Kong exceeding

$US300 million, the organisational learning and knowledge-based management

practices of project-based joint ventures across differing organisations were examined.

The findings of Study One identified that inter-organisational compatibility, capacity

building (i.e., access to expanded profits, competitive advantage issues, opportunities,

management expertise, knowledge regarding clients, projects, or new and diverse

technologies), and capability maturity (i.e., trust and commitment) were key aspects of

successful joint venture partnership relationships in influencing knowledge-based

management practices.

In Study Two, the purpose was twofold. First, the findings of Study One were used

together with the relevant research literature to construct and develop an 89-item

‘Strategic Alliance Contracting Inventory’ (SACI). This inventory was composed of

highly reliable and construct valid measures (i.e., Satisfaction with Joint Venture

Performance; Cultural Divergence; Competitive Advantage; Inter-Organisational Trust;

Strategic Fit; Decision Control; Inter-Parent Cooperation; Commitment to the Joint

Venture; Organisational Commitment). Second, the SACI was then administered to a

v

representative sample of 40 administrative, managerial and executive personnel

involved in the implementation of four project-based construction joint ventures.

Based on the findings of Study Two, Bivariate Pearson product-moment correlations

revealed that self-reports were significantly interrelated, though not according to Age of

the Alliance (Years) nor the Number of Inter-Firm Partnerships. Analyses of Variance

revealed there were no significant differences in self-reports according to Type of Joint

Venture nor Respondent’s Relational Status (i.e., Head Office, Onsite). However, there

were significant mean item-related differences concerning collaborative managerial

practices in project-based joint ventures. In addition, Regression Analyses found that

Cultural Divergence and Commitment to the Joint Venture uniquely accounted for a

significant proportion of variance in predicting Satisfaction with Joint Venture

Performance. The findings of this research significantly enhance and build upon

existing levels of knowledge and understanding in knowledge-based management

practices and organisational culture which influence project-based joint venture

performance within the construction and engineering industry. Finally, methodological

implications and recommendations for future investigative research are given.

vi

Acknowledgements

First, I would like to express my deepest gratitude to my Principal Supervisor Professor

Derek H.T. Walker at RMIT University, and also Professor Stephen M. Rowlinson at

The University of Hong Kong who extended to me their ready assistance, guidance and

encouragement over the past 6 years. I would also like to acknowledge the statistical

assistance of Dr. Rick Kellner. His experience, patience and knowledgeable advice in

the analytic and statistical procedures developed for the procedural methodology of this

research was invaluable. I would also like to thank them for their friendship.

This doctoral research, however, would not have succeeded without the participation of

many notable construction and engineering industry leaders in Hong Kong, with whom

I have worked closely over the past years. Namely, their organisational knowledge,

expertise and understanding of cross-cultural aspects of joint venture functioning and

performance provided important insights in understanding the relationship between

organisational culture and knowledge-based management practices in engendering

competitive advantage amongst multinational corporations involved in complex

infrastructure projects in the Hong Kong construction and engineering industry.

Moreover, I am indebted to the help of many faculty staff members within the School of

Building and Construction Economics and in the School of Business at RMIT

University who provided me with an opportunity, scholarship and facilities for the

timely completion of this research. In addition, I would also like to acknowledge the

contributions offered by Dr. Florence T.T. Phua at Hong Kong University, Peter Slack,

Daniel Klein, Hu Jian Hua, Marco Yu, as well as John Porter for his long support and

vii

friendship of almost 30 years. Finally, I would like to express my grateful thanks to Ms

Annie Ho whose research and administrative assistance were invaluable.

viii

Declaration

In accordance with the regulations for presenting theses and other work for higher

degrees, I hereby declare that this doctoral thesis is entirely my own work and that it

has not been submitted for a degree at any other University.

______________________________________

Derick S. Johannes

RMIT University, Melbourne

November, 2004

Note: This doctoral thesis has been formatted in accord with the Harvard style of

referencing (Snooks & Co, 2002).

ix

Table Of Contents

Page

Dedication iii

Abstract iv

Acknowledgements vi

Declaration viii

List of Tables xx

List of Figures xxiii

List of Appendices xxv

CHAPTER ONE 1

INTRODUCTION 1

1.1. The General Context of the Research. 1

1.1.1. The Context of Joint Learning 2

1.1.2 Hong Kong Joint Ventures 5

1.2. Aims of Research and the Research Questions. 7

x

Table Of Contents (Continued …)

Page

1.3. Significance of the Research. 8

1.4 Theoretical Foundation and Research Justification 9

1.5. Overview of the Methodological Research Justification 11

1.6. Chapter Summary. 14

CHAPTER TWO 15

LITERATURE REVIEW 15

2.1 Understanding the Significance of Cooperative Strategic Alliances in

the Attainment of Sustainable Competitive Advantage within the Hong

Kong Construction and Engineering Industry

16

2.2. Project-Based Joint Ventures in the Hong Kong Construction and

Engineering Industry: Organisational and National Cultural Knowledge

and Competence

19

2.3. Organisational and Operational Management of Project-Based Joint

Ventures: Implications of the ‘Knowledge Management Economy’ in the

Creation of Sustainable Competitive Advantage

23

2.4. Impact and Influence of Organisational and National Culture Upon

the Operational Functioning of Project-Based Joint Ventures. 29

2.5 Topographical, Political, Economic, and Cultural Influences Upon

the Historical Development of the Hong Kong Construction and

Engineering Industry

37

2.6. Relationship-Based Procurement of Contracts and the Strategic

Positioning of Joint Ventures within the Hong Kong Construction and

Engineering Industry: Implications for Understanding the Congruence

between Organisational Development and Managerial Practice

45

xi

2.7. Understanding Project-Based Joint Venture Performance:

Organisational/National Culture vs. Organisational Commitment

49

2.8. Understanding Project-Based Joint Venture Performance:

Organisational/National Culture vs. Inter-Organisational Trust

53

2.9. Understanding Project-Based Joint Venture Performance: Strategic

Fit, Inter-Parent Cooperation, Decision Control, and Commitment to

Joint Venture

58

2.10. Methodological Limitations of the Relevant Research Literature:

Rationale of the Present Research in Understanding Satisfaction with

Project-Based Joint Venture Performance

66

2.11. Chapter Summary

71

xii


CHAPTER THREE 74

METHODOLOGY AND RESEARCH DESIGN 74

3.1 Understanding the Purpose and Significance of Methodological

Research Design

74

3.2. Research Purpose and Approach: Implications for Research

Method Reliability and Validity.

75


CHAPTER FOUR 81

Study One: Inter-Organisational Culture, Competitive

Advantage and Project-based Joint Venture Behaviour

81

4.1. Purpose of Study 81

4.2. Method. 82

4.2.1. Qualitative Methodology in Understanding the Inter-

Organisational Culture and Competitive Advantage of Project-Based

Joint Ventures

82

4.2.2. Procedure. 83

4.2.3. Instrumentation. 84

4.2.4 Sample Size and Characteristics 85

xiii


Page

4.2.5 Overview of the Data Analysis 85

4.3. Results. 86

4.3.1. JV Design: Culture of Inter-Organisational Learning 86

4.3.2. JV Design: Inter-Organisational and Operational Culture 93

4.3.2.1. What Joint Ventures Want and Offer.-Synergy 94

4.3.2.2. Joint Venture Design: Inter-Organisational Trust,

Commitment, Vulnerability and Risk Sharing.

96

4.3.2.3. Joint Venture Design: Organisational and Operational

Foci.

100

4.4. Discussion of the Findings of Study One: Implications for

Study Two.

103


CHAPTER FIVE 108

Study Two: Development, Evaluation And Validation Of The

Strategic Alliance Contracting Inventory

108

5.1. Method. 111

xiv


Page

5.1.1. Instrument Development Procedures. 111

5.1.1.1. Satisfaction with Joint Venture Performance (9

items).

111

5.1.1.2. Cultural Divergence (10 items). 112

5.1.1.3. Competitive Advantage (6 items). 113

5.1.1.4. Inter-Organisational Trust (9 items). 113

5.1.1.5. Strategic Fit (18 items). 114

5.1.1.6. Decision Control (3 items). 114

5.1.1.7. Inter-Parent Cooperation (12 items). 115

5.1.1.8. Commitment to the Joint Venture (6 items). 115

5.1.1.9. Organisational Commitment (16 items). 116

5.1.2. Sample Size and Characteristics. 116

5.1.3. Procedure. 120

5.1.4. Research Questions Leading to Hypotheses. 121

5.1.4.1. Hypothesis One. 121

xv


Page

5.1.4.2. Hypothesis Two. 121

5.1.4.3. Hypothesis Three. 122

5.1.4.4. Hypothesis Four. 122

5.1.5. Overview and Detailed Justification of Statistical and

Item Analysis Conducted.

122

5.1.5.1. Understanding the Statistical Significance of

Analyses Conducted Implications for Type I and Type II

Errors.

123

5.1.5.2. Computation of Estimates of Internal Consistency

(i.e., Cronbach’s Alpha).

123

5.1.5.3. Computation of Item Discrimination Indices (i.e.,

Phi).

124

5.1.5.4. Bivariate Pearson Product-Moment Correlation

Coefficients.

126

5.1.5.5. Appropriateness of Factor Analytic Procedures. 126

5.1.5.6. Multivariate/Univariate Analyses of Variance and

Post-hoc Tukey HSD Pair wise Comparisons.

127

xvi


Page

5.1.5.7. Utilisation and Computation of Effect Sizes. 128

5.1.5.8. Stepwise and Hierarchical Multiple Regression

Analytic Procedures.

129

5.2. Results. 131

5.2.1. Internal Consistency (Cronbach’s Alpha) and Item

Discrimination of the Strategic Alliance Contracting Inventory

(SACI).

131

5.2.2. Descriptive and Inferential Statistics Relating to

Relationships and Differences Among the Sample (n = 40).

143

5.2.2.1. Intercorrelations between Age of the Alliance,

Number of Inter-Firm Partnerships and Dependent Measures

143

5.2.2.2. Satisfaction with Joint Venture Performance,

Cultural Divergence, Competitive Advantage, Inter-

Organisational Trust, Strategic Fit, Decision Control, Inter-

Parent Cooperation, Commitment to the Joint Venture,

Organisational Commitment: MANOVA, Univariate, and

Pair wise Post-hoc Tukey HSD Comparisons.

145

xvii


Page

5.2.2.3. Stepwise Multiple Regression of Satisfaction with

Joint Venture Performance on Independent Variables (i.e.,

Cultural Divergence, Competitive Advantage, Inter-

Organisational Trust, Strategic Fit, Decision Control, Inter-

Parent Cooperation, Commitment to the Joint Venture, and

Organisational Commitment).

153

5.2.2.4. Hierarchical Multiple Regression of Satisfaction

with Joint Performance on Cultural Divergence and

Commitment to the Joint Venture.

153

5.3. Discussion. 158


CHAPTER SIX 163

CONCLUSIONS AND RECOMMENDATIONS 163

6.1. A Restatement of Objectives 163

6.2. Achievement of Objectives 1 and 2 164

6.3 Achievement of Objective 3: To develop a set of measures

concerned with organisation culture of project-based joint

ventures in Hong Kong

169

xviii


Page

6.4 Achievement of Objective 4: To assess the Validity and

Reliability of Measures used in this research

171

6.5 Achievement of Objective 5: To develop empirical testing

of theoretically based hypotheses for Studies One and Two,

impact of their outcomes and implications including

acknowledgement of methodological implications of this

research

172

6.6 Achievement of Objective 6: To show original contribution

of the findings with relevant research literature and

contribution to industry practice

178

6.7 Recommendations for Further Research 183

6.8 Closure 185

REFERENCES 187

APPENDICES 225

xix

List of Tables

Page

Table 2.1. The Four Management Blueprints 24

Table 2.2. Link between Literature Review and Studies One and

Two

72

Table 4.1. Attitude Towards Culture of Inter-Organisational

Learning Within JVs.

86

Table 4.2. Reasons Why Learning May Be Important To JVs. 90

Table 4.3. How Learning May Be Achieved Within JVs. 91

Table 4.4. What JVs Want Business Want/Offer –

Expansion/Maintenance.

94

Table 4.5. What JVs Want Business Want/Offer – Synergy. 95

Table 4.6. JV’s Vulnerability and Risk Factors. 97

Table 4.7. JV’s Trust/Commitment Issues. 99

Table 4.8. JV Design – Organisational Focus. 101

xx

List Of Tables (Continued …)

Page

Table 4.9. JV Design – Operational Focus. 102

Table 5.1. Sample Characteristics of Project-Based Construction

Joint Ventures.

119

Table 5.2. 2 x 2 Contingency Table for Computing the Phi

Coefficient.

125

Table 5.3. Internal Consistency (Cronbach’s Alpha) and Item

Discrimination of ‘Satisfaction with Joint Venture

Performance’.

133


Discrimination of ‘Cultural Divergence’.

134


Discrimination of ‘Competitive Advantage’.

135


Discrimination of ‘Inter-Organisational Trust’.

136


Discrimination of ‘Strategic Fit’.

137


Discrimination of ‘Decision Control’.

139

xxi

List Of Tables (Continued …)

Page


Discrimination of ‘Inter-Parent Cooperation’.

140


Discrimination of ‘Commitment to the Joint Venture’.

141


Discrimination of ‘Organisational Commitment’.

142

Table 5.12. Inter-Relationships Between Age of the Alliance,

Number of Inter-Firm Partnerships and Dependent

Measures.

144

Table 5.13. Item-Related Differences According to Type of Project-

Based Joint Venture: Means (and Standard Deviations).

147

Table 5.14. Post-hoc Item-Related Comparison According to Type

of Joint Venture.

150

Table 5.15. Item-Related Comparison According to Project-Based

Relational Status: Means (and Standard Deviations).

152

Table 5.16. Hierarchical Multiple Regression Analysis of

Satisfaction with Joint Venture Performance on Cultural

Divergence and Commitment to Joint Venture.

155

xxii

List of Figures

Page

Figure 1.1 Research Project Mental Map 1

Figure 1.2 Overview and Methodological Descriptive Road Map of

Doctoral Thesis.

12

Figure 2.1. Strategic Alliances between firms according to level

Perceived Financial Risks, Human Resources and Costs

21

Figure 2.2. Organisational Management of the Knowledge

Economy

28

Figure 3.1. Representative-Based Schematic Model of Research

Design (Source: Sekaran, 1992, p. 93).

76

Figure 4.1. Organisational Learning Motivation for Achieving

Successful JV Projects.

105

Figure 5.1. Process of Validation of the Research Design of the

Doctoral Thesis.

109

Figure 5.2. Relationship of Satisfaction with Joint Performance on

Cultural Divergence and Commitment to Joint Venture.

157

Figure 6.1. Model of Thesis Conclusions 170

xxiii

List of Appendices

Appendix A Glossary of Terms and Abbreviations Used (Listed

Alphabetically)

Appendix B Structured Interview Questions Used in Study One.

Appendix C Raw Structured Interview Responses of Study One.

Appendix D Strategic Alliance Contracting Inventory (SACI) Used

in Study Two.

Appendix E Descriptive Summary of the Four Differing Types of

Joint Ventures.

Appendix F Descriptive Raw Data of Study Two Participants

(n = 40) Based on the Strategic Alliance Contracting

Inventory (SACI).

Appendix G Raw Item Response Data from the Strategic Alliance

Contracting Inventory (SACI).

Appendix H List of Internationally Peer-Reviewed Publications.

1

CHAPTER ONE

INTRODUCTION

The purpose of this research is to develop a cultural understanding of how joint ventures

provide construction and engineering companies in Hong Kong with a competitive advantage

in undertaking construction infrastructure projects. Where appropriate, the significance and

identification of organisational cultural factors that facilitated or inhibited a competitive

advantage were investigated. More specifically, the research concentrates upon knowledge

transfer, quality of operational performance and how this is facilitated through developing

cooperative relationships. This chapter describes the general context, research questions,

theoretical foundation, purpose, and significance of the research. In addition, it provides a

structural overview of the research and justification of its qualitative and quantitative

methodology.

1.1. The General Context of the Research.

JV Success

High Levelcooperation

betweenJV parties

Superior performance

Drives

Facilitates

Competitiveadvantage through:(1) differentiation

(2) cost advDrives

Jointlearning

Drives

Mutualunderstanding

Drives

Drives

Culturalawareness

Facilitates

Influence:Drives = strongFacilitates = moderate+ve

Mobilising niche joint assets

Joint problemsolving/R&D

DrivesDrives

Joint riskmanagement

Primary link

Primary link

Figure 1.1 Research Project Mental Map

Chapter One: Introduction

2

Figure 1.1 illustrates links and the nature of the hypothesis to be addressed by the research. It

first links joint learning with a focus on cultural awareness to JV joint learning and then links

this to success via competitive advantage.

Infrastructure development necessitates and requires cooperation between skilled people of

varying cultural backgrounds, beliefs, attitudes, and values to work together in order to realise

their goals. While subcontracting and outsourcing constitute the most common response to joint

effort in building and infrastructure projects, another response has been development of

project-based joint venture arrangements in which companies seek to share risk, skills, and

reward (Das & Teng, 2001; Yoshino & Rangan, 1995). According to Doz and Hamel (1998),

establishment and development of inter-company joint ventures represent a strategic response

to cooperate for mutual benefit and survival. Such collective action tends to constitute the

reason for the success of the accomplishment and completion of construction and engineering

projects of varying magnitude and complexity (Gupta & Misra, 2000).

1.1.1 The Context of Joint Learning

The value of joint learning is of prime importance in facilitating competitive advantage within

the construction and engineering industry (Barney, 1997; Argote & Ingram, 2000). Knowledge

transfer needs to be developed at all levels within an organization, effectively facilitated by

executive management and diffused across the organisation. For example, a number of benefits

have been proposed for developing and establishing inter-company alliances. Notably, Bresnen

and Marshall (2000b) have suggested inter-company alliances offer such benefits to both

clients and contractors within the construction and engineering industry in terms of cost, time,

quality of inter-company relations, and buildability. Other reasons for establishing and

developing inter-company alliances relate to enhancing technological-based capabilities

through research and development initiatives, together with improving competitiveness,

efficiency, and the management of financial and organisational risks and costs (Barringer &

Harrison, 2000; Das & Teng, 2000; Ireland, Hitt, & Vaidyanath, 2002)).

Doz and Hammel (1998) suggest three broad purposes of an inter-company alliance. These

include: (i) co-option, (ii) co-specialisation, and (iii) learning and internalisation. Co-option

refers to the process of transforming potential rivals or competitors into equitable and mutual

allies by the proving complimentary goods and services that enables new inter-organisational

coalitions to develop. Co-specialisation refers to the combination of previously independent

technological, skill and knowledge resource bases within the alliance as companies seek to


3

work towards a mutually elected goal. Learning and internalisation allows inter-company

alliances to develop new knowledge-based skills and core competencies. Hence, learning

gained from an alliance partners can often be leveraged broadly into other activities and

business beyond the alliance.

Fundamental challenges exist, however, in strategically managing complex inter-company

relationships in order to gain or maintain competitive advantage for industry success (Mohr &

Spekman, 1994). For example, in the mid-1970s, Eastman Kodak’s senior management

concluded that the company lacked the capabilities and market position to gain sufficient

customer acceptance of a new film format to take advantage of improvised technology

(Frangos, 1993; Kanter, Richardson, North, & Morgan, 1991). As a result, Kodak entered into a

significant alliance in the early 1990s with its fiercest competitor, Fuji Photo Film, together

with three other camera manufacturers (i.e., Canon, Minolta, and Nikon). As a collective, they

invested billions of dollars to create the Advanced Photo System, a technology which allows an

individual using one camera with a fixed lens to switch back and forth between standard, close-

up, and wide-angle pictures. Most companies cannot individually afford the time nor have the

resources to develop breakthrough technology. IBM, Motorola, and Apple Computer jointly

collaborated developing the PowerPC microprocessor to create this next-generation alternative

to the Microsoft Windows-Intel monopoly on personal computer operating systems and

microprocessors (Hagedoorn, Carayannis, & Alexander, 2001). Examples abound in other

industries. Kumar (1996) demonstrated how ‘Wal-Mart’ and ‘Proctor & Gamble’ in the United

States agreed to collaboratively work together on a number of commercialised sales, marketing,

and merchandising projects in the highly competitive retail sector. Similarly, Petronas (a

Malaysian natural gas company) undertook a 30% equity stake in the Engen franchise (a

petroleum retailer in South Africa) to gain entry and facilitate competitive advantage through

the investment of learning about technologically based resources in furthering oil exploration

and refining ventures throughout Africa and the Indian-Pacific Ocean (Harbison & Pekar,

1997).

Inter-company alliancing and collaboration within the construction and engineering industry

represents a purposeful initiative designed to promote efficiency, increase productivity, and

reduce reported budgeted project costs by as much as 30% (Bennett & Jayes, 1995). More

importantly, it is acknowledged that inter-company collaboration entails the requirement of

mutual inter-organisational commitment and trust and willingness to cooperate in achieving

targeted objectives (Pheng & Leong, 2000; Harris & Moran, 2000)—for example in

deployment of organisational systems of managerial knowledge and practice that support the


4

long-term objectives of the contractual relationship. This needs to be compatible with the

existing organisational culture to deliver competitive advantage and thus ensure both survival

and success of the joint venture (Black, Akintoye, & Fitzgerald, 2000; Hoecklin, 1995).

National and organisational culture operates and functions at many different levels in inter-

company alliances in terms of maintained cultural attitudes, values, and beliefs held and

enacted by managerial and/or project-related staff (Isabella, 2002). National culture tends to

reflect embedded societal norms and values derived from an individual’s host country or

country of origin. Organisational culture relates to the system of shared values, decision-

making practices and leadership styles of all people within a company (Hofstede, 1980, 1991).

Taken together, national and organisational cultural attitudes, values and beliefs are likely to

interact together upon the functioning, expressed satisfaction of people, and performance of the

inter-company alliance. This happens in two ways that relate to inter-organisational trust,

cooperation, commitment, and decision-making (Clugston, Howell & Dorfman, 2000; Jones,

1998; Lasserre, 1999). First, through relationships between staff of varying national cultural

heritage and second through discretionary and decisive ways of working are achieved and

enacted. Hence, the cultural dynamics and organisational governance structure play important

roles in the success of an inter-company alliance (Grandori, 1997; López-Navarro & Camisón-

Zornoza, 2003). As a consequence, investigating the relationship between national and

organisational culture, communication and trust may provide important information in

facilitating the competitive advantage of inter-company alliances. Competitive advantage is

defined as the acquirement of knowledge-based management and organisational learning

practices which allow companies to develop technological-based resources, capabilities, and

core competencies through inter-organisational co-operation, trust and commitment while

jointly solving problems (Harrison, 2003).

Particularly recent, however, is the development of project-based joint ventures between

companies within the Hong Kong construction and engineering industry. According to Saloner,

Shepard, and Podolny (2001), project-based joint ventures refer to inter-company relationships

where short-term and long-term goals of two or more ‘partner’ companies are jointly defined to

achieve sustainable competitive advantage, and hence inter-organisational success and

performance, in a profitable and highly productive manner.

Kumaraswamy and Morris (2002) identify a range of inter-company project-based joint

ventures exists within the Hong Kong construction and engineering industry. These include

‘Build-Own-Operate’ (BOO), ‘Build-Operate-Transfer’ (BOT), and ‘Build-Own-Operate-


5

Transfer’ (BOOT) projects. BOO, BOT, and BOOT projects engage one or more private

contracting sponsors in the joint operational development, financing and governance of projects

for a short or extended period of time. They do this to return a profitable outcome on the initial

capital investment before deciding to maintain or transfer ownership of the project to an

alternative granting authority (Kumaraswamy & Morris, 2002; Schaufelberger & Wipadapisut,

2003).

Despite the varying types of inter-company project-based alliances within Hong Kong, the

inherent and recognized barriers to entry in becoming a contractor within the Hong Kong

construction and engineering industry do not tend to be substantive nor overburdening (Walker,

1995). Rather, the Hong Kong Government mandates and grades the list of contractors who are

allowed to tender for different levels of work within this industry. For example, ‘foreign’

contractors fall within a separate list and are defined as ‘foreign’ if they maintain overseas

head-office business addresses. Presently, the majority of these ‘foreign’ contractors have now

also satisfied the ‘local’ rule through maintaining a permanent residential Hong Kong head

office business address.

According to Ganesan, Hall, and Chiang (1996), one of the most direct methods for ‘local’

contractors to participate in major projects within the construction industry (in order to gain

advanced knowledge-based expertise) involves becoming pro-active in developing and

establishing project-based joint ventures with ‘foreign’ contractors. As a result, the

development of inter-company alliances within the construction industry tends to have been

regarded as a recent and rare phenomenon (Chinowsky & Meredith, 2000).

1.1.2 Hong Kong Joint Ventures

It has been well documented that ‘foreign’ or contractors with headquarters outside Hong

Kong, undertook and performed approximately 25% of the total value gained from allocated

building and civil engineering work in the 1990 financial year (Walker, 1995). Hence, large

numbers of ‘foreign’ contractors tend to make the ‘local’ market highly competitive by gaining

tenure and stability of long-term contractual security. This is because many ‘foreign’

contracting companies’ secured contracts due to their technological expertise which ‘local’

companies had otherwise failed to acquire. The presence of ‘foreign’ contractors may not

always prove to be beneficial or productive to the long-term development of a ‘local’ industry.

Therefore, ‘foreign’ companies need to actively collaborate and/or merge with ‘local’ or Hong

Kong-based companies, or alternatively, register for long-term business contractual


6

relationships in Hong Kong, dependent upon the strategic-related necessities of resource

building and competitive-based leveraging (Li & Wong, 2003).

According to Walker (1995), ‘foreign’ companies have acquired or created alliances with more

than 20 local companies within Hong Kong (Walker, 1995). Furthermore, eight of the 20

construction companies drawn from the top echelon of Hong Kong contractors include four

previously defined as ‘foreign’—French Dragages at Travaux Public (Hong Kong) Limited, a

company owned by the French contracting giant, Bouygues with its headquarters in Paris.

Japanese, Nishimatsu Construction Co Ltd, with its headquarters in Tokyo, People’s Republic

of China company, China Harbour Engineering Group with its headquarters in Beijing.

Gammon Construction Ltd, previously owned by the Jardine Group and Trafalgar House in the

UK, then changed ownership to Gammon Skanska Limited and with the recent ownership

changes, with Balfour Beatty, also a UK based owner, taking over Skanska’s shareholding,

returned to its original name, Gammon Construction Ltd. Such dominance appears due to

medium-sized companies in Hong Kong being ill equipped to carry out increasingly

technologically demanding projects, which tend to have characterised the business environment

of Hong Kong since the late 1980s. These larger global twenty companies that have developed

and established inter-company alliances either amongst themselves, or with ‘lower tier’

construction companies in the form of project-based joint ventures. Consequently, technical

competence, financial strength, as well as a proven and demonstrated record of expertise in

planning and management, representative of Hong Kong’s architectural infrastructure, is

introduced to inter-company alliances.

From the perspective of these ‘foreign’ contractors, the potential for realising knowledge-based

competitive advantage benefits is through forming project-based joint ventures that facilitate

opportunities to reach business markets in mainland China (Wan, 1998). The Hong Kong

infrastructure construction and engineering industry has delivered impressive results with many

projects being delivered through project-based joint ventures between ‘local’ and ‘foreign’

construction contractors (Yeung, 1994). Developing cultural awareness and knowledge of how

large-scale infrastructure project-based Hong Kong joint ventures are organised and operate

can lead to enhanced understanding of success factors to provide useful business partnerships

guidelines.

1.2. Aims of the Research

The purpose of this research was to develop a cultural understanding of the varying knowledge-

based managerial and inter-organisational practices between local and foreign-based

contractors, in engendering competitive advantage within large scale infrastructure projects


7

being conducted in Hong Kong. To achieve this objective, two separate, yet interrelated

studies, were conducted.

In Study One, exploratory interviews were conducted with nine senior level executives

involved in major infrastructure projects in Hong Kong exceeding $US300 million. In this

study, the organisational learning and knowledge-based management practices of project-based

joint ventures across differing organisations were examined. Principal research questions

included in Study One (see Appendix B) explored and investigated some of the following

propositions; a) Large-scale construction infrastructure projects requires a portfolio of

knowledge-based skills offered by a project-based joint venture, composed of several

companies, each with its own set of organisational skills and competencies. No single company

can successfully undertake such projects alone, therefore, b) Companies seek out and establish

project-based joint ventures in order to facilitate knowledge-based transfer through: i) adopting

skills gained and hence expand potential services that can be offered; ii) understanding their

own limitations and what to look for in future project-based joint ventures; and iii) acquiring

cross-cultural skills and tacit understanding of how to effectively work and function.

Following the findings of Study One and a critical review of the relevant research literature as

related to understanding the nature and dynamics of cross-cultural practices, further research

questions were formulated and developed into Study Two, 89-item “Strategic Alliance

Contracting Inventory” (SACI) (see Appendix D). The SACI included some of the following

questions; i) What type of cultural knowledge transfer is taking place within large-scale

project-based joint venture arrangements in the Hong Kong construction and engineering

industry? ii) What cultural-related benefits, if any, can companies gain, in terms of knowledge

transfer, through the establishment and formation of a project-based joint venture between

‘local’ and ‘foreign’ contractors? iii) What cultural-related difficulties, if any, exist in the

establishment and formation of a project-based joint venture with a ‘local’ and ‘foreign’

contractor? iv) How do ‘local’ and ‘foreign’ contractors react and adapt to cultural differences

when involved in a project-based joint venture? v) What cultural-related organisational and

operational factors contribute to successful knowledge transfer in engendering competitive

advantage on large-scale joint venture construction infrastructure projects being undertaken in

Hong Kong? vi) Can reliable and valid measures be developed to measure the performance and

functioning of project-based joint ventures between ‘local’ and ‘foreign’ contractors within the

Hong Kong construction and engineering industry? vii) What factors influence the performance

and functioning of project-based joint ventures between ‘local’ and ‘foreign’ contractors within

the Hong Kong construction and engineering industry?


8

Differences in respondents’ self-reports according to culture and type of joint venture are also

investigated.

1.3. Significance of the Research.

Over the last decade, there have been numerous calls for the construction industry to embrace

more collaborative approaches in working together which enable the best implementation

solution possible for project teams with a strong customer focus (Kumaraswamy & Morris,

2002; Van Der Merwe, 2002). As a result, the fundamental realisation that project-based joint

ventures may better address customer needs has now been unconditionally recognised,

particularly in the Hong Kong construction and engineering industry (Zhang, &

Kumaraswamy, 2001; Zhang, Kumaraswamy, Zheng & Palaneeswaran, 2002). Despite such

recommendations, however, project-based joint ventures may otherwise prove to be

problematic when they do not function as a ‘true’ partnership designed to achieve shared and

common project objectives.

The proposed research is thus significant in several ways. First, there is an important need for

research on project-based joint ventures to enhance our limited understanding of (a) how

knowledge transfer is effectively undertaken, and (b) in what way it facilitates “competitive

advantage” through Hong Kong construction infrastructure projects. Competitive advantage

being defined in this research context covering all or some of the following areas; performance

quality, price, technologies used or available, engineering skills, financial strength, site safety,

speed of delivery, personable manner of employees, geographical location and political

influence.. The proposed research identifies and builds upon existing understanding in relation

to the significance of how project-based joint ventures engender knowledge-based competitive

benefits for large-scale infrastructure projects in Hong Kong. It achieves this through

investigating the relevant literature followed by undertaking inter-related qualitative and

quantitative studies to systematically address this issue.

Second, the history of Hong Kong as an economic ‘experimental’ model has provided

valuable and much needed insights into economic and cultural issues. For example the

transfer of British sovereignty of Hong Kong, resulting in the establishment of the

Special Administrative Region (SAR) of China, has tended to legitimise Hong Kong as

a ‘naturalistic’ laboratory for examining and testing ideas which link commercial and

political dimensions. Consequently, this PhD research provides valuable insights into


9

the functioning of cultural knowledge transfer within project-based joint ventures in

very large infrastructure projects. Potentially, results from this research may offer

deeper understanding of knowledge transfer in the facilitation of competitive advantage

within the Hong Kong construction and engineering context.

Much of the research literature has tended to focus on project-based joint ventures where

participating companies are of ‘local’ origin. Hence, only limited research appears to have been

undertaken into examining project-based joint ventures where ‘foreign’ contractors are allied

with ‘local’ contractors’. The emergence and growing popularity of BOT, BOO, and BOOT

project procurement systems has necessitated large-scale adoption of inter-company alliances

to effectively undertake such projects. These multi-billion dollar projects are being undertaken

with insufficient evaluation of the impact of national and organisational culture upon the level

of performance success of inter-company alliances and partnership arrangements delivering

such projects.

As a consequence, understanding the role of project-based joint ventures in facilitating

knowledge-based competitive advantage within the Hong Kong construction and engineering

industry through knowledge transfer represents an issue of vital importance from a commercial

and political perspective. Hong Kong is in a unique position as an experimental geographic

zone within China. China requires infrastructure development in order to service a population

well in excess of one billion people. Issues of knowledge transfer are, therefore, of particular

value. Thus, the present research with its focus on cultural knowledge transfer between project-

based joint venture partners is of particular value for both ‘local’ and ‘foreign’ contractors

engaged in delivery of large-scale infrastructure projects in the Hong Kong construction and

engineering industry.

1.4. Theoretical Foundation and Research Justification.

Developing countries face severe problems in building the large-scale infrastructure required

allowing them to become industrially developed and/or technologically advanced (Pangarkar,

1998; Sim & Ali, 2000). It is doubtful that any single construction company has the industry

knowledge, experience or professional expertise to successfully deliver and complete very large

projects in Hong Kong. For example, the Hong Kong Government funded 71%, US$110

Billion dollars of the Chep Lap Kok Airport and its attendant access infrastructure works from

Hong Kong Central to the Airport. The remaining 29% of funding was drawn from the private

sector, largely financed by the creation of 59 joint ventures comprising 155 partner companies


10

from 19 countries (e.g., Hong Kong – 23%, United Kingdom – 16%, People’s Republic of

China – 8%, Netherlands – 6%, France – 5%) (Hung, Naidu, Cavusgil, & Yam, 2002).

Hence large-scale infrastructure construction projects, if delivered by a single company, would

provide an unsustainable risk not only to the financial survival of the construction contractor

but also to the client who originally commissioned the project. These risks include the

possibility that the project would not be delivered at all, or if so, at great additional cost and/or

being completed well over schedule. It is for this reason that government clients welcome

investment through establishing project-based joint ventures involving one or more

construction companies.

Generally, governments and relevant funding institutions encourage investment growth in

completing large-scale construction infrastructure projects. From a ‘foreign’ construction

company’s perspective, ‘local’ knowledge and connection to networks of influence is

considered a valuable knowledge asset through the development of infrastructure project-based

joint ventures where ‘local’ contractors undertake much of the construction work. ‘Foreign’

company provide access to managerial knowledge unavailable at the ‘local’ level and the

‘local’ company provides ‘local’ intelligence, access to markets, and ‘local’ networks of

influence at a range of potential commercial and political levels.

An understanding of the significance of project-based joint ventures in internationally

diversified business practices between ‘local’ and ‘foreign’ contractors has been the subject of

important and significant debate and research since the early 1980s (Büchel, Prange, Probst, &

Rüling, 1998; Pearce, 2001). If the project-based relationship succeeds, then there is an

enhanced chance of a successful project outcome. Alternatively, if the relationship fails, this

places a heavy burden upon all concerned in order to overcome difficulties of poor

communication and coordination that subsequently follow in the wake of poor relationships.

Hence, Büchel (2000) stresses the importance of cooperative working relationships within an

inter-company alliance. In addition, knowledge transfer and trust between project-based joint

venture partners is equally important in ensuring and achieving overall success within the

context of the inter-company alliance (Snell & Hui, 2000).

The concept of project-based joint venture partnerships between ‘local’ and ‘foreign’

companies holds much promise that has, in the case of Hong Kong, been successfully realised

(Walker, 1995). In particular, the infrastructure market in Hong Kong is considered unique in

that it has an ‘open door’ policy to international competition (Ganesan, Hall & Chiang, 1996;


11

Walker, 1995). Therefore, Hong Kong provides a valuable global target for understanding the

influence of national and organisational culture in facilitating or inhibiting the performance,

success, and knowledge-based competitive advantage of project-based joint ventures between

‘local’ and ‘foreign’ contractors within the highly competitive construction and engineering

industry context.

The relevant literature applicable to this work revolves around culture, competitive advantage

and factors that impact upon the formation and operation of joint venture organisations to

deliver complex and large projects. This literature will be more fully explored justifying the

research in Chapter 2. While this literature explains why project-based joint venture

partnerships generally occur there is a paucity of literature explaining this in the specific

context of how ‘foreign’ and ‘local’ culturally construction companies interact to build capacity

for competitive advantage to address market potential in Mainland China. This limitation in the

literature provides a gap for further study of this area can make a valuable and viable

knowledge contribution.

1.5. Overview of the Methodological Research Justification.

According to Phillips and Pugh (1994), the degree of Doctor of Philosophy (PhD) entails the

conceptualisation and operationalisation of a specific research problem to address identified

gaps or limitations in existing levels of a specific field’s theoretical knowledge. This might

entail undertaking and employing varied methodological approaches to build upon, synthesise,

adapt, re-interpret, evaluate and/or critically review specific or existing levels of knowledge.

The purpose and significance of this research therefore is to provide a significant and original

contribution to the field through providing insights into the nature of the relationship between

organisational culture and knowledge-based management practices in enabling competitive

advantage among ‘local’ and ‘foreign’ contractors engaged in construction project-based joint

ventures in Hong Kong.

Figure 1.2 provides an overview of the research structure that was developed to test the

hypothesised research mental map illustrated in Figure 1.1. The research comprises two

separate yet interrelated studies. Study One in Chapter 4 is focussed upon the investigation of

nine executives that were involved in joint ventures to undertake infrastructure projects in

Hong Kong. In Study Two of the research, Study One research instrument was refined and

further developed to undertake a survey of 40 management-level staff engaged on joint venture

infrastructure projects.


12

Researcher’s objective experiential knowledge & career-

related experience of project-based construction infrastructure joint ventures in the Hong Kong

construction industry

Critical review of relevant research literature on joint venture & portfolio

of hypothesized factors affecting performance of joint ventures

Justification of the methodological research design of the doctoral thesis & research questions

Methodology & results of Study One qualitative-based case study design

Discussion of the findings of Study One: implications for Study Two

Methodology & results of Study Two quantitative-based research design

Discussion of the findings of Study Two:Implications for understanding project-based construction joint ventures

Summary, recommendations & conclusions

Figure 1.2: Overview of the Research Design of the Thesis (‘The Road Map’).

Both Studies One and Two were based upon a critical review of the relevant research literature

in Chapter Two, in combination with the primary researcher’s experience and knowledge in the

execution of significant project-based joint ventures within the Hong Kong construction and

engineering industry over many years.

In Study One, Chapter Four, an exploratory qualitative-based methodological approach was

employed in order to canvas the expert opinion of executive managerial personnel active within

current large-scale infrastructure projects in relation to seven issues deemed relevant to

organisational culture in facilitating competitive advantage. These include: (i) the formation of

an alliance (including economic and operational scope); (ii) partner contributions; (iii) the JV

demands; (iv) standards of operations and skills; (v) the learning attitudes of JV partners; (vi)

whether these organisations were open to cross-learning; and (vii) in what ways cross-learning

might be achieved.

According to Fine and Elsbach (2000), qualitative field data provide a context through which

naturalistic real-life phenomena can be more accurately described and investigated than

through quantitative field data. Thus, such data aided in facilitating the validation of hypothesis


13

testing and theory-building through the identification of subjective meanings and processes.

Therefore, the purpose of Study One involved the in-depth interviewing of nine individuals,

mainly Company Chief Executive Officers (CEO’s) and Senior Executives, all of whom who

were intimately involved in a number of large-scale construction infrastructure projects of

several hundred million US dollars.

It is important, however, that such qualitative-based analyses be supplemented with

quantitative data in order to substantiate the context-dependent discussions of results (White,

2002). In Study Two, Chapter Five, therefore, the findings of Study One were used in

combination with the relevant literature to refine relevant and appropriately worded items to

provide a research instrument to examine the relationship between the organisational and

operational functioning of project-based joint ventures in the Hong Kong construction and

engineering industry. The approach to undertaking Study Two involved sampling 40

individuals (i.e., company chief executive officers (CEO’s), project directors, project managers,

construction managers, site managers, commercial managers, and solicitors). These individuals

were drawn from a small sample of representative project-based joint ventures in order to trial

and examine the reliability and validity of the developed instrumentation, as well as discern

significant differences and relationships among the salient variables being investigated.

The final chapter of this thesis (i.e., Chapter Six) integrates the findings of the research from

Studies One and Two, together with a summary of the overall conclusions and their

implications. Further, in developing a cultural understanding of collaborative practice within

the Hong Kong construction and engineering industry, the strategic implications and

significance of the present research findings are critically discussed. In particular, this is

achieved by examining the relationships between cultural drivers and inhibitors, knowledge

transfer, competitive advantage and project success. Finally, beneficial and efficient

recommendations for future research are given.

1.6. Chapter Summary.

This chapter introduces the purpose of the research as developing a better understanding of

how national and organisational culture facilitates joint venture partners to achieve joint

learning that, together with these joint venture partners bringing an array of skills and assets to

be deployed in jointly solving problems, leads to competitive advantage and joint venture

success. Figure 1.1 illustrated the research idea as a mental map. All this was developed with a

focus upon very large infrastructure projects in Hong Kong and so the chapter provides a

background context of the research being located in Hong Kong—as a highly competitive and


14

open economy, Hong Kong provides a rare opportunity to conduct this type of investigation.

While it was noted that local joint venture partners gain technical and management learning,

foreign partners can gain deep cultural learning and insights that could provide valuable

competitive advantage in mainland China and elsewhere. The nature of the relationship

between local and foreign joint venture partners acting within the highly open and competitive

Hong Kong infrastructure development market was identified as being poorly understood and

the dynamics of this process seems poorly represented in the literature—so bridging this

knowledge gap was identified as justifying this PhD research.

The research aims and questions were then outlined to provide a refinement of a roadmap to

achieve the general purpose of the research. This provided the framework to identify the

significance of the research topic to justify its general worthiness as a PhD topic and it specific

value to the construction and engineering industry. The worthiness of the research was further

justified through a brief synopsis of the methodological research design and Figure 1.2 was

provided as a road map to explain the research approach.

The next chapter will provide a substantial review of the literature supporting the thesis and

forming the basis for questions asked in the empirical research instruments used to gather data

for analysis.

CHAPTER TWO

LITERATURE REVIEW

The introductory chapter of this thesis described the purpose and context of the research. Key

areas of theory, included joint venture formation and maintenance, knowledge transfer, the

impact of organisational culture on project performance, and organisational learning

outcomes. Each of these issues will be reviewed in order to establish the limitations of current

knowledge about joint ventures involving construction and engineering infrastructure projects

in Hong Kong.

In this chapter, a critical review of the literature relevant to the development, establishment

and formation of project-based joint ventures within the Hong Kong construction and

engineering industry is presented. The research literature review presented in this chapter

formed the basis for developing empirical instruments, to test hypotheses and to explore the

research questions developed in both Chapter Four, Study One and Chapter Five, Study Two,

together with providing the basis for framing questions used in both Study One and Study

Two, and the rationale linking the literature review to both Study One and Study Two.

This chapter is divided into Eleven Sections. Sections One and Two present critical reviews

of current available literature, in developing an understanding of strategic planning and

management in the creation of sustainable competitive advantage within the Hong Kong

construction and engineering industry. Section Three extends the discussion through an

examination of the role of ‘knowledge management’ in facilitating organisational learning

and knowledge transfer between partner companies, involved in project-based joint ventures.

Section Four looks at the impact and influence of organisational and national culture upon the

operations and daily functioning of project-based joint ventures highlighting the evidence for

both positive and negative influences on the performance levels of project-based joint

ventures.

Section Five notes the socio-political, topographic and economic history of the construction

and engineering industry, highlighting the unique aspects of the industry in Hong Kong. This

Chapter Two: Literature Review

16

adds a necessary context, without which any understanding of the present infrastructure of

this industry in Hong Kong is severely limited.

Section Six focuses on management practices and looks at how differing types of corporate

culture in managerial and organisational practices can be crucial to facilitating and optimising

the nature of the inter-parent relationship in achieving joint venture success.

Sections Seven, Eight, and Nine then provides a critical understanding of factors that

influence and/or hinder the development of project-based joint venture partnerships within the

Hong Kong construction and engineering industry. In particular, the significance of

Organisational and National Culture in Section Seven, Inter-Organisational Trust,

Organisational Commitment, and Commitment to Joint Venture in Section Eight, and

Strategic Fit, Decision Control, and Inter-Parent Cooperation in Section Nine are critically

reviewed. Also and importantly, Section Ten examines the rationale of the present research

and is discussed in light of the methodological limitations of the relevant research literature.

Finally, Section Eleven provides a chapter summary.

2.1. Understanding the Significance of Cooperative Strategic Alliances in the

Attainment of Sustainable Competitive Advantage within the Hong Kong Construction

and Engineering Industry Until recently, many companies were content to go it alone, confident that they had sufficient

capabilities and organisational knowledge, resources and skills to succeed in the marketplace

(Caves, 1998; Lorange & Roos, 1992). Within the Hong Kong construction and engineering

industry, however, this is no longer the case. Given the growth opportunities in global

markets and new technologies, there is an inherent need and demand for a wider range and

level of expertise, competency, knowledge and organisational skill in effectively managing

complex infrastructure projects. Due to the re-engineering and downsizing of many

companies over the last 20 years within the construction and engineering industry, there has

been an increasing need for companies to consider the significance of cooperative strategic

alliances often with their rivals. In an effort to optimise organisational resources in order to

productively pursue, undertake, and complete new business ventures (Chan, Kensinger,

Keown, & Martin, 1997; Duysters, Kok, & Vaandrager, 2000).

Within the Hong Kong construction and engineering industry, therefore, the significance of

establishing and developing cooperative strategic alliances with other companies, in order to

ensure sustainable competitive advantage, cannot be underestimated. (Kayworth & Leidner,


17

2000) Strategic alliances represent a logical and timely response to intense and rapid changes

in economic activity, technology, and globalisation, as companies once entered closed

markets and actively pursued untapped, new market opportunities, together with new

solutions for customers, and answers to poorly met needs (Oxley, 1999; Safarian & Dobson,

1997).

As a consequence, senior management (e.g., chief operational/executive officers, presidents)

are hence more willing to invest time, energy, commitment as well as organisational

resources, toward establishing and maintaining joint ventures with other partner companies

with the aim of facilitating and enhancing the market competitiveness of their own company

(García-Canal, Duarte, Criado, & Llaneza, 2002; Mathews, 2002).

According to Thompson and Strickland (1999), business competitiveness is defined wherein

organisations seek to develop ‘an edge’ over rival companies through initiatives, which seek

to attract customers in delivering superior ‘market value’. Such a process may be referred to

as strategic planning and management in encouraging the promotion and facilitation of

business efficiency and effectiveness (Viljoen & Dann, 2003). Business efficiency refers to

how well an activity or operation is performed in terms of organisational methods,

procedures, systems and rules. Alternatively, business effectiveness relates to ensuring that an

organisation undertakes and performs the correct operational activities.

In order to appropriately respond to the demands of the external environment in terms of

customer needs, strategic planning and management requires organisational flexibility (Quinn

& Voyer, 1996). Such flexibility is created through the organisational design and

management of limited resources, which seek to promote the sharing of internal skills, as well

as finite resources and information in response to changing external conditions, and hence,

high levels of organisational risk. Based on such identified risk, strategic planning and

management thus presumes that organisational (e.g., internal analysis of the organisation),

environmental (e.g., market research, industry reports, customers), and competitor

information (e.g., annual reports, media articles, mutual clients) needs to be gathered (Ho,

1998). Such data are necessary in order to guide the management of organisational resources,

coordinate organisational efforts, anticipate the future and plan investments, as well as

provide a cohesive framework in the implementation of strategies in the assessment,

management, planning, and appraisal of the status of organisational change and operations.


18

Hence, strategic planning and management within the construction and engineering industry

is about identifying, developing, and implementing a sustainable business strategy which

enhances the long-term performance of an organisation through compatibility between the

internal skills and resources of the organisation, and the external environment in which it

operates (Viljoen & Dann, 2003). Such level of sustainable competitive advantage may be

achieved in a number of ways through management action plans, which seek to provide both

advantageous benefits and value to relevant stakeholders within the industry.

This may be through organisational knowledge, technological competence, superior customer

service, low costs, perceived quality, and efficiency in the way in which services are

delivered in a cooperative and coordinated manner, relative to competitors.

Without question, an unprecedented number of strategic alliances which bridge national

borders and continents are increasingly being established each year between partner

companies in order to improve the business competitiveness of companies within the

marketplace (Contractor & Lorange, 2002). For example, according to Harbison and Pekar

(1997), there was a 25% per year increase in the reported number of strategic alliances

between partner companies between 1987 to 1997. Such alliances, however, tend not to be

limited to a few industries. Rather, they are inclined to occur broadly across various sectors.

For example, such industries comprise the transportation, manufacturing,

telecommunications, electronics, pharmaceuticals, finance, construction, engineering, as well

as other professional service organisations (Dollinger & Golden, 1992; Powell, 1998). Thus,

it is well documented that strategic alliances have become a cornerstone of global

competitiveness, one in which company executives need to understand and manage with both

cultural competence and adaptive skill (Anand & Khanna, 2000; Gulati, Nohria, & Zaheer,

2000).

In regard to cultural sensitivity, competency and skill in the management of strategic

alliances, there remain few company directors or managers who may be accustomed to

working with undefined boundaries in encouraging and facilitating collaborative task

allocation, and role responsibility between partner companies (Johnson & Scholes, 1997).

The need to flexibly combine and integrate unfamiliar competencies and organisational levels

of knowledge, resources and skill, with networks of interdependent alliances, in the

attainment of sustainable competitive advantage, may tend to prove problematic (Matthews,


19

1999). For example, such reasons may include previous or lack of experience in networking

with other companies, the perceived and projected cost of skill and knowledge transfer.

Alternatively, discernible differences in decision-making and managerial work practices in

individual and joint business goals between companies may also potentially limit and hinder

the cooperative development and functioning of strategic alliances between partner

companies in the attainment of sustainable competitive advantage (Von Hippel, 1994;

Williams, Han, & Qualls, 1998).

2.2. Project-Based Joint Ventures in the Hong Kong Construction and Engineering

Industry: Organisational and National Cultural Knowledge and Competence. The concept of sustainable competitive advantage in creating ‘market value’ was widely

discussed in the late 1980’s (Porter, 1990). According to the ‘value chain’ model, which was

developed by Porter and his colleagues, organisations were composed of a collection of

primary and secondary activities which were used to transact business through the design,

production, marketing, delivery and support of various ‘products’ (i.e., good and/or services)

(Wood, 2000). Primary activities in the ‘value chain’ of an organisation included design,

procurement, productions and operations, distribution, service, and support.

Secondary activities comprised personnel, finance, and administration. According to Porter

(1980, 1983), it was argued that the continuity and integrity of primary activities could be

enhanced through the sharing and distribution of information technology within an

organisation, in order to automate and re-engineer secondary business processes in optimising

the ‘best’ positioning approach towards sustainable competitive strategy within the market

environment.

At the time, the facilitation of sustainable competitive advantage through the establishment of

partnership arrangements with other companies in creating ‘market value’ was regarded as a

somewhat novel approach. This is because ‘conventional wisdom’ dictated and maintained

that the primary purpose of business was to add ‘market value’ to the company’s own

shareholdings through increased profits. Such management action could be undertaken in a

number of ways. This could entail expanding business opportunities through the penetration

of new markets, or alternatively, through the competitive take-over activity of other

companies in order to increase an organisational company’s market share. In establishing and

developing partnership arrangements with other companies, however, it is generally


20

acknowledged that the ability of organisations to appropriately respond and manage the

diverse needs of customers is difficult.

Given this concern, it may be more efficient and cost-effective for companies to acquire an

organisation that matches a particular customer’s needs and characteristics based upon market

demand and the supply of the company’s required resources. As a result, some companies

may elect to procure the existing infrastructure of organisations in order to gain access to

customers, or in an attempt to match or surpass their competitive status or orientation.

In the latter case, this may be either through the low-cost provision of a product or service,

appealing to a broad spectrum of customers, being the ‘best-cost’ (i.e., more value for money)

provider of products and services of comparable quality and features, or alternatively,

focusing organisational market strategies upon lower cost or customised product or services,

relative to other organisational competitors within the business marketplace (Thompson &

Strickland 1999).

In the attainment of sustainable competitive advantage within the Hong Kong construction

and engineering industry, therefore, strategic alliances between companies may be

represented or determined by a multiplicity of forms, which vary in terms of the level of

perceived financial risk, human resources, and cost.

According to Segil (1996), strategic alliances between companies may be represented by a

‘continuum’ which comprises ‘take-over/mergers’, ‘joint ventures/equity investment’,

‘research and development, knowledge transfer’, ‘original equipment manufacturer licensing

(in the patenting of private labels)’, or ‘joint marketing/distribution’ (refer to Figure 2.1).


21

Joint Marketing/Distribution

HIGH RISK, MAXIMUM USE OF HUMAN RESOURCES, HIGH COST

LOW RISK, MINIMUM USE OF HUMAN RESOURCES, LOW COST

Original Equipment Manufacturer (OEM)Licensing/Private Label

Research+Development/Technology Transfer

Joint Venture/Equity

Take-Over/Merger

Complete acquisition of one company by another.Companies are merged into a single corporate entity

Two companies cooperate on the creation of a new,separate company.

Two companies join in a research + developmentproject to promote a new technology or product orservice

One company develops a product orservice to be marketed + sold byanother

One company joins with an other tomarket, sell, and distribute a product

Figure 2.1: Strategic Alliances between Companies According to Level of Perceived

Financial Risk, Human Resources, and Cost

Although such an ‘alliance continuum’ is originally derived from the field of marketing and

manufacturing (as shown in Figure 2.1), this ‘paradigm’ may be compared to the construction

and engineering industry. In particular, ‘take-over/mergers’ refers to the vertical integration

of the ‘supply chain’, where one company may voluntarily merge with another in order to

maintain an indefinite and continued business entity in which the two ‘independent’

companies result in inter-organisational consortia.

Within the construction and engineering industry, ‘take-over/mergers’ with other companies

may result in efficiency and effectiveness in the ability to undertake, finance, and complete

complex infrastructure projects of sizeable financial risk and cost, in which stakeholder input

varies. For instance this may range from an entrepreneurial stake that identifies customer

need, developing the project concept, locating the appropriate financial resources, developing

the legal rules and regulations governing the inter-organisational consortia, together with

negotiating the fiscal operating concession in the management of such a complex

infrastructure project. Conversely, ‘take-over/mergers’ with other companies may require and

demand excess management energy, which may lead to downsizing and structural


22

rationalisation of the existing infrastructure within a particular organisation in order to gain

market share in attempting to create a more efficient operation (Bower, 2001).

Another alliance approach between companies may entail ‘joint venture/equity investment’

(Segil, 1996). With joint venture investment, two companies cooperate in the creation of a

‘new and separate’ business entity in order to reach mutually compatible project-based goals.

It may be more preferable to find an appropriate organisation with which to form a

partnership relationship, which already has complementary customer characteristics, or can

easily acquire them. This entails developing ‘virtual’ organisations from ‘separate’

organisations in order to maximise the ‘market value’ offered to customers through the

provision of a ‘consortium’ or a ‘joint venture’ organisation. The resultant benefits of such an

approach are a range of diverse and unique organisational and knowledge-based resources,

which may effectively service the ‘supply chain’ needs of targeted customers within the

construction and engineering industry.

Conversely, equity investment involves the purchase of a part of one company’s equity by

another in exchange for cash, marketable stock, or other compensatory consideration. Hence,

equity investment may carry associated risks in that there may be a take-over of the remaining

equity, market share, or intellectual capital by another organisational company.

Whereas equity investment involves a proportionate degree of ownership of an existing

entity, establishing a joint venture presumes that two or more existing companies develop a

new existent entity through the contribution of joint organisational resources.

Alternatively, joint ventures between companies may provide other partnership opportunities

in terms of research and development, knowledge transfer, original equipment manufacturer

licensing, or through joint marketing/distribution. In particular, the Fuji-Xerox and

Caterpillar-Mitsubishi joint ventures have been cited as successful, which have been

developed into large corporate enterprises in their own right. Such partnership opportunities

between companies have not only contributed to their parent organisation’s fiscal revenue,

but also provided further organisational learning opportunities through the acquisition and

development of resource-based expertise, competence and skill (Bleeke & Ernst, 1993;

Lendrum, 1998). Further, although the Original Equipment Manufacturer (OEM) joint

marketing equivalent appears difficult to find within the construction and engineering

industry, unless a franchised consultancy matches and accords with this category, the


23

traditional partner arrangement between companies within the construction and engineering

industry appears to represent the closest equivalent.

Consequently, project-based joint ventures between companies provide a tool for creating

agility in response to the diversity in skills, work culture, and business practices, which

characterise customers. A project-based joint venture represents a market-driven response to

change, globalisation, and business process alignment, in purposively aiming to achieve

customer focus (Walker, Hampson, & Peters, 2000).

More specifically, project-based joint ventures refer to the integrated and coordinated

management of the internal (e.g., organisational knowledge, resource and asset deployment

and acquisition) and external context (e.g., social, cultural and political environmental

pressures) in which organisations exist and operate in order to effect subsequent performance

(Jenkins, Ambrosini, & Collier, 2002; Saloner, Shepard, & Podolny, 2001). Moreover, such

practices of engaging in project-based joint ventures tend to date to the commercial exploits

of merchants of Ancient Egypt and Mesopotamia (Smith, Carroll, & Ashford, 1995).

2.3. Organisational and Operational Management of Project-Based Joint Ventures:

Implications of the ‘Knowledge Management Economy’ in the Creation of Sustainable

Competitive Advantage According to organisational theorists, a number of theories have been forwarded regarding

the principles, which may underlie effective strategic management work practices in

promoting sustainable competitive advantage within the marketplace. Such theories include

administrative, human relationship, as well as structural and resource-based views of the

organisational company (Viljoen & Dann, 2003).

In particular, there exists limited information of how early major construction and

engineering projects (e.g., Egyptian Pyramids, Asian cities, temples and monuments of the

Incas, Aztecs and Mayan people) were realised in terms of the division and management of

labour between workers (Moore & Lewis, 1999).

Limerick, Cunninton, and Crowther (1998, p. 30) proposed a model of managerial taxonomy

in terms of collaboration and cooperation in organisational work practices within the

competitive marketplace. According to this model, organisational development may be


24

characterised as a progressive and evolutionary managerial shift from the ‘First’ to the

‘Fourth’ Blueprint (refer to Table 2.1).

As shown in Table 2.1, the four Management Blueprints reflect varying degrees of

organisational autonomy, flexibility of action, and physical proximity of teams among and

between workers. At the most isolated and fragmented extreme of this continuum (i.e., ‘First’

Blueprint’), companies may elect to compete and undertake projects under a specified variety

of contractual forms.

Table 2.1: The Four Management Blueprints (Source: Limerick, 1998, p30)

‘First’ Blueprint

(‘Classical’)

‘Second’ Blueprint (‘Human’)

‘Third’ Blueprint

(‘Systems’)

‘Fourth’ Blueprint

(‘Collaborative Organisations’)

Organisational Forms

• Functional • Mechanistic • Organic

• Interlocking Matrix

• Contingency • Divisional

• Loosely coupled networks and alliances

Management Principles

• Hierarchy • Supportive relationships

• Differentiation • Empowerment and collaborative individualism

Managerial Processes/ Forms

• Management functions

• Democratic leadership

• Open systems analysis

• Management of meaning

Managerial Skills

• Person-to-person control

• Goal setting • Facilitation

• Rational • Diagnostic

• Empathetic • Proactive

Managerial values

• Efficiency • Productivity

• Self-actualisation

• Social support

• Self-regulation • Social sustainability

• Ecological balance

At the other extreme (i.e., ‘Fourth’ Blueprint), companies coalesce their technological and

knowledge-based resources through project-based joint ventures in an effort to create a

‘single cohesive’ organisation. For example, within the partner arrangement between

companies, a new legal entity is created with allocated resources being seconded from

individual ‘host’ companies who are cooperatively involved within the alliance (Barney,


25

1997). Also the customer often tends to represent a pivotal and centralised element within

such arrangements between companies, in relation to the short-term purpose of a specific

project, or in order to maintain a continuing, committed, and purposeful relationship (Cleland

& Ireland, 2002).

According to Limerick, Cunninton, and Crowther (1998), many organisations appear to reside

at the ‘Third’ Blueprint stage. Such a management style is characterised by a fear of higher

levels of management losing control over their authority, together with subsequent loss of

sustainable competitive advantage, through networking and outsourcing. Due to the emphasis

upon managerial command and control, therefore, such a leadership style tends to inhibit and

restrain organisational initiative, whereby those with access to information, knowledge, and

an understanding of the consequences of their actions accept sole responsibility for decision-

making practices (Greene & Elfrers, 1999; Hersey, Blanchard, & Johnson, 1996).

In contrast, the ‘Fourth’ Blueprint relies heavily upon the mutual trust and respect in the

management, coordination, and task allocation of role responsibilities among workers from

such ‘loosely coupled’ companies. Hence, the ‘Fourth’ Blueprint is considered as the

recommended direction for the immediate future in seeking to achieve corporate success in

the global and competitive marketplace (Birkinshaw, 2000; Dixon, 2000).

As a result, there has been a progressive but gradual shift towards the adoption of the ‘Fourth’

Blueprint in business partnerships between companies within the Asia-Pacific region (Karpin,

1995).

In order to facilitate the advantageous benefits of task collaboration and cooperation between

organisational partner companies, Limerick, Cunninton, and Crowther (1998) provide a

number of recommended guidelines. These include: (i) liberating line managers through

encouraging discretionary decision-making practices; (ii) defining the boundary roles of

individual workers; (iii) developing effective communication systems which promote

reciprocal information sharing; (iv) negotiating the contractual terms of the partner

arrangement in defining the purpose of the alliance in selecting partner companies with

compatible organisational resources and structures; as well as (v) managing issues of

organisational trust, commitment, and expectations in ensuring sufficient networked resources

are provided for effective knowledge transfer and human resource contact among and

between the organisational personnel of differing partner companies.


26

Importantly, another key element of the Fourth Blueprint is organisational learning (Argyris

& Schön, 1996). In terms of project-based joint ventures between companies, knowledge

transfer represents one way in which sustainable competitive advantage may be achieved

through organisational learning. In order to facilitate knowledge transfer to ensure project

success, however, there needs to be a creative and engaged process of building and harnessing

new levels of knowledge-based skills and resources based on existing knowledge (Cavallo,

2000; Ramaprasad & Prakash, 2003). Namely, companies need to become ‘action-learning’

oriented, in being able to be self-reflective through information acquisition, sharing and

distribution. This is achieved through the sharing of diverse perspectives between individuals

and groups in order to reflect and transfer new forms of organisational knowledge, and insight

(Lähteenmäki, Toivonen & Mattila, 2001; Nonaka, 1996).

This is important in being able to critique the identity, inherent values, assumptions and

mission statement of the organisation. Furthermore, organisational objectives need to be

accomplished not only through supporting critical appraisal, but more significantly, through

the provision of effective feedback (Holt, Love & Li, 2000).

As such, this engenders informed and decisive action, hence sustainable competitive

advantage; in recognition of the status of organisational knowledge regarding current

management systems and practices, as well as differences in organisational values and beliefs

between the workers of differing partner companies (Argote & Ingram, 2000; Tsang, 2002).

In terms of the defined ‘knowledge economy’ of an organisation, knowledge-based assets, or

rather the ‘explicit’ (formal) and ‘tacit’ (informal) codified information, regarding the work

culture of an organisation.

Whereas ‘explicit’ knowledge may be operationally defined as knowledge, which may be

easily expressed or codified by and between differing individuals, ‘tacit’ knowledge tends to

be more personal, experiential or context-specific. Further, such ‘explicit’ or ‘tacit’

information may be considered individualistic, or alternatively, as a shared body of

information which is common to the prescribed mandates/rules, regulations and policies of

the organisation (Fernie, Green, Weller, & Newcombe, 2003). In the latter case, however, organisational ‘tacit’ knowledge is only likely to be acquired

through interpersonal contacts and social networks, where such information is expressed

explicitly by other individuals in relation to organisational skills, resources and knowledge

which are likely to enhance project success (Abell & Oxbrow, 2001; Koskinen, Pihlanto, &

Vanharanta, 2003). As a consequence, the transfer, exchange and diffusion of organisational


27

learning among and between workers of differing partner companies, represents a significant

knowledge-based asset in order to achieve sustainable competitive advantage within project-

based joint ventures.

As such, in line with the significance of learning in terms of knowledge transfer, partner

companies need to be sufficiently receptive in welcoming the value of challenge and

experimentation through consideration of the organisation as a ‘cooperative learning’

community from levels of senior management down (Nesan & Holt, 1999). As a

consequence, critical appraisal and the provision of effective feedback in regard to the

inherent values, assumptions and mission statement of the organisation, allows informed and

decisive strategic action to be undertaken (Holt, Love, & Li, 2000). For example, this may be

in relation to the status of organisational knowledge, pertaining to operational management

systems and work practices, as well as differences in organisational values and beliefs

between the workers of differing partner companies (Argote & Ingram, 2000; Tsang, 2002).

Without exception, companies which benefit from such alliances, in attaining sustainable

competitive advantage over their rivals, are those which learn from each other in response to

the dynamic organisational conditions and demands of the business environment (Tena,

Llusar, & Puig, 2001; Cavaleri & Fearon, 2000).

Hence, the transfer, learning, and melding of unique knowledge-based organisational skills

and resources remain critical to the success of alliances in the promotion of sustainable

competitive advantage (Bishop, 2002; Liebowitz & Megbolugbe, 2003). Such skills are

important in learning how to provide services in a more cost-effective and efficient manner in

seeking to maximise market share value as well as profitability (Leonard-Barton, 1995;

Hargadon & Sutton, 2000).


28

ExplicitKnowledge

TacitKnowledge

Customer/supplier Company

Exchange explicitKnowledge through

dialogue

Externalise

Knowledge about products and market,

Mental models

Needs, Knowledge,

Mental models

Mutual understanding and trust through shared experience

Figure 2.2: Organisational Management of the ‘Knowledge Economy’ (Source: Nonaka,

Toyama, & Konno, 2001)

In terms of organisational learning between partner companies, however, such a process

needs to promote and facilitate cultural awareness and understanding of how workers and

managers articulate, attribute and apply explicit and tacit knowledge at an individual and

group level (refer to Figure 2.2).

Also, there needs to be a process of critical inquiry which encourages dialogue in order to

promote shared levels of understanding and problem solving between individuals in the

completion in how project goals and specified objectives will be planned and achieved over a

specific timeframe. Consequently, the significance of inter-organisational dependency and

integration, in the identification and application of knowledge between workers, represent

essential project management skills (Morris, 1994; Walker, 1993).

This is of particular significance and has been achieved within the airline industry through

innovative ticketing and e-commerce, and recognised leaders in this type of service delivery

approach have been able to acquire sustainable competitive advantage over their rivals

(Gudmundsson, de Boer, & Lechner, 2002; Morrish & Hamilton, 2002). Similarly, within the

highly commercialised automotive industry, the notion of ‘supply chain’ management has

been extended to vehicle manufacturers. In order to ensure that they exchange their

engineering staff with their suppliers, to work in their suppliers’ site of employment, to

facilitate and engender transferability of learning in order that these enterprise partners may


29

jointly and co-operatively provide a better and more competitive product (Womack & Jones,

2000; Womack, Jones, & Roos, 1990).

Not just within the construction and engineering industry, but within other manufacturing and

service organisations, establishing inter-company alliances may entail undertaking different

approaches, in order to achieve sustainable customer benefit; equally the ability to learn, trial

and experiment, enables partnered organisations to gain valuable mutual benefit in the terms

of inter-organisational transfer of organisational and knowledge-based knowledge

competencies, skills, and expertise (Oum, Park, & Zhang, 2000).

2.4. Impact and Influence of Organisational and National Culture Upon the Operational

Functioning of Project-Based Joint Ventures Increasingly, within a corporate and competitive global business environment, the

development, establishment, and maintenance of project-based joint ventures between

organisations tends to be influenced by differing cultural ideologies, beliefs, values and norms

between partner companies, workers and colleagues (Cui, Ball, & Coyne, 2002; Holden,

2002). Within a particular culture individuals tend to share and maintain particular

worldviews and national values, as well as individualised ways of working. This may include

appropriate and/or specific ways of communicating, engaging in decision-making, accepting

authority, and in managing conflict.

Hence, within the culture of project-based joint ventures between organisations, differences in

organisational and individual values may create cognitive dissonance and ethical tensions

(Viljoen & Dann, 2003). This may be apparent not only within the culture of an individual

organisation, but also between companies engaged in project-based joint ventures. That is,

the prevailing competitive culture of an organisation to achieve ‘results at any cost’ may

encourage workers to behave and act in a manner, which is inconsistent with their own

individual and/or national values. As a result, the concept of there being a ‘universal style’ of

management, which is most effective in project-based joint ventures, remains meaningless.

This is because organisational and management practices between partner companies engaged

in project-based joint ventures are likely to be shaped by many presiding and inherent factors,

of which organisational and national culture represent two important influences.

As such, although project-based joint ventures may provide access to organisational learning

opportunities, there is also the likelihood of cultural misunderstandings and conflict between

workers of differing partner companies.


30

This is particularly so, given the finite and fixed time-frame of project-based joint ventures,

which may limit and/or hinder inter-company negotiations, organisational resource

commitment, as well as harmonious cooperation between workers (Luo & Shenkar, 2002; Ng,

Rose, Mak, & Chen, 2002; Rao & Schmidt, 1998). Therefore the significance and importance

of project management staff in the planning of inter-company collaborations and task

allocation responsibilities, between workers of differing partner companies, is paramount in

order to facilitate joint venture performance, given differences in organisational and national

culture (Cleland & Ireland, 2002).

Within a project-based joint venture between differing partner companies, therefore,

organisational and national culture simultaneously operate and influence one another. Such

cultural attributes may manifest themselves at one or more levels. This may comprise

‘explicit’ culture (i.e., observable reality in terms of symbols), norms and values (i.e., mutual

sense of what is ‘right’ or ‘wrong’, ‘good’ or ‘bad’), as well as ‘implicit’ assumptions

(Trompenaars & Hampden-Turner, 1997). Hence, organisational and national culture

provides a means through which individuals seek to interpret their experience, and guide their

subsequent actions. An understanding of the diversity of the organisational and national

cultural aspects of project-based joint venture relationships, therefore, plays an important

regulatory function in engendering success and effective performance (Demirbag & Mirza,

2000).

For example, in light of national culture, the need to share and manage organisational

knowledge as an essential commodity between workers, and across teams within an

organisation, represents an essential component in creating project-based sustainable

competitive advantage (Bresnen, Edelman, Newell, Scarbrough, & Swan, 2003; Fernie,

Weller, Green, & Newcombe, 2003).

At an organisational level, culture may be defined as the shared values, which underlie and

seek to determine the work-related behaviours of staff (Viljoen & Dann, 2003).

Organisational culture may thus be defined as a way in which individuals seek to apply rules

and procedures in order to solve problems, and work towards amenable solutions.

Organisational culture may manifest itself in a number of different ways. For example, this

may be in terms of implicit and explicit assumptions and knowledge regarding ‘teamwork’,

‘cooperation’, as well as incentive, control, and decision-making practices which seek to

maximise and encourage communication, work efficiency, collaboration and competitiveness


31

(Schein, 1996). Accordingly, the codification and sense-making of organisational-specific

understandings underlie principles of culturally-specific Knowledge Management (KM)

within the corporate world (Davenport & Prusak, 1998; Roberts, 2000).

Conversely, national culture refers to the shared values, beliefs, and attitudes held and

maintained by a particular group of individuals. According to Gannon (1994), it has been

estimated that national culture may account for as much as 25% to 50% of variation in

individual attitudes towards work practices, which in turn, may positively or negatively

impact upon the organisational functioning and performance of teams. Such diversity of

worldviews may increase the level of resources available with which to manage complex

problems. However, such diversity may also create ambiguity, complexity, and confusion in

the management of group processes, in impacting upon the efficiency and effectiveness of

team productivity and performance.

Based on extensive field research of 116,000 questionnaires, collected and gathered from

IBM employees over 40 countries, Hofstede (1980) categorised national culture into a

number of different work-related dimensions. These included: Power Distance, Uncertainty

Avoidance, Individualism-Collectivism, and Masculinity-Femininity. In turn, such cultural

dimensions were factored from such attributes as achievement, creativity, autonomy, and self-

determination among others in order to provide a relative measure of group characteristics,

which were representative of societal value orientations.

Such cultural measurements tend to be distinctly ‘Western’. Of particular significance is the

fact that such cultural dimensions have been found to be significant predictors of multiple

bases and the focus of commitment (i.e., organisation, supervisor, workgroup) (Clugston,

Howell, & Dorfman, 2000). In other words cultural socialisation tends to predict

organisational commitment.

Power Distance refers to the extent to which a society accepts unequal distribution of power.

It represents a measure of how hierarchical or egalitarian a society is. Whereas ‘high’ Power

Distance societies reserve privileges for individuals of higher status or rank, ‘low’ Power

societies minimise such status differentials. Moreover, individuals in high Power Distances

countries readily accept authority and tend to remain dependent upon superiors, in acceptance

of their superior social status. Hence, Power Distance appears to foster dependency-based

relationships, whereby individuals ‘have’ to stay due to their inherent and underlying beliefs

about being subordinate within society and having few alternatives (Chew & Putti, 1995).


32

Uncertainty Avoidance is indicative of the extent to which individuals feel threatened by

uncertain and ambiguous situations, and thus seek to avoid them. As such, individuals high in

Uncertainty Avoidance tend to seek greater career stability, formal rules, avoid risk, have

longer job tenure, and have fewer intentions to leave organisations. In part, such avoidance of

risk among individuals appears due to the inherent fear of failure and fear of taking

responsibility. Consequently, Uncertainty Avoidance tends to promote a committed intention

among employees to remain within an organisation, due to the calculation of loss or the

feared potential associated with the loss of leaving.

In regard to Masculinity-Femininity, although this work-related dimension tends to reflect

upon gender roles, Hofstede defined this characteristic in terms of employment. According to

Hofstede (1980, 1983), some of the dominant values in a Masculine society tend to be

assertiveness, acquisition of money and material things, not caring for others nor the quality

of life. Conversely, the polar opposite of Masculinity (i.e., Femininity) presumes concern for

people and quality of life, together with empathy and interdependence. Whereas the

Masculine cultural attribute promotes the exchange of behaviours for extrinsic rewards among

individuals, the Feminine aspect entails the emotional commitment of employees toward an

organisation (O’Reilly & Chatman, 1986; Randall, 1993).

Alternatively, Individualism-Collectivism refers to the extent to which individuals within a

society tend to define themselves in terms of individual identity or group membership. In as

much as high individualism societies are individualistic, those low in individualism are

referred to as collectivistic. In the latter case, individuals tend to interact based on their

identity as a group member (e.g., employee of a particular employer, as a family member).

Additional research, however, revealed a fifth dimension of national culture. Specifically, this

cultural dimension related to the concept of time, and was referred to as Confucian

Dynamism. According to Hofstede and Bond (1988), Confucian Dynamism was comprised of

eight values. Of those considered to be relatively important, such individuals attributes

comprised: (i) persistence or perseverance, (ii) ordering relationships by status and observing

this order, (iii) thrift, and (iv) having a sense of shame. Of those considered relatively

unimportant, these include: (i) personal steadiness or stability, (ii) protecting one’s “face”,

(iii) respect for tradition, and (iv) reciprocation of greetings, favors, or gifts.


33

From an Asian perspective, the importance of such individual dimensions tended to be based

upon patterns of behaviour, which sought to enrich group cohesiveness through reciprocal

and social interdependence or debt, thereby facilitating the entrepreneurial benefits and

success of business partnerships between differing companies. Today, such extent and level

of business reciprocity between partner companies is explained as a matter of repaying

favours through an informal process termed quanxi-hu in China or keiretsu in Japan.

Confucian Dynamism, however, does not represent an exclusive value among China or East

Asian cultures. Rather, it represented a composite cultural ‘value’ missing within Western

value systems. For example, Hofstede and Bond (1988) found ‘parallel’ national values,

similar to Confucian Dynamism, in a number of South American, African and sub continental

Asian populations

In terms of project-based joint ventures between differing companies, however, the majority

of research studies have tended to focus upon the examination of such cultural dimensions as

Individualism-Collectivism and Power Distance. Although cultural individualism and

collectivism tend to have been traditionally conceived as independent and discrete

dimensions, at opposite ends of a -one-dimensional continuum, more recent research suggests

that such cultural traits coexist in all individuals, as well as within all societies (Triandis,

1995). Within a given organisation, therefore, it may be argued that individualism and

collectivism represent meaningful dimensions within the particular context of that

organisation. Given that that individualism and collectivism may be represented at both an

individual and societal level, such cultural dimensions thus represent extremely salient themes

which individuals may use to understand, categorise, and interpret their immediate

environment in structuring their sense of self and identity.

The identification of an individual as idiocentric or allocentric thereby reflects the relative

probability of behaving in a way that is respectively consistent with either individualism or

collectivism in a variety of contexts (Schwartz, 1994). Specifically, whereas idiocentrism

tends to be characterised by adherence to notions such as independence, uniqueness, and self-

reliance, allocentrism is suggestive of interdependence, belongingness to in-groups, as well as

subservience to the wishes of the in-group. Dependent upon any specific situation, therefore,

individuals may view the values, beliefs, norms, and assumptions associated with either

individualism or collectivism, as more relevant to the particular situation. For example, based

on the survey responses of 916 employees from 46 Turkish organisations, Robert and Wasti

(2002) found that organisational individualism tended to be related to the use of

individualistic human resource practices at the organisational level.


34

Furthermore, congruence or ‘fit’ between individuals’ values and perceived expectations and

perceptions of the actual organisational culture served to predict job attitudes, including

measures of satisfaction with the work itself, together with employees’ perceived level of

satisfaction with both co-workers and supervisors.

While Hofstede (1980 1983) aided in identifying salient work-related dimensions among

national cultures, a major limitation of his research was that domestic populations are rarely

culturally homogenous. Rather, there tend to be many specific aspects of national culture

(e.g., ethnicity, religion, language), which Hofstede’s work-related measures did not take into

account nor consider (Hempel, 1998). Equating ‘culture’ with ‘country’, therefore, neglects

the methodological significance of intra-country cultural heterogeneity (Douglas & Craig,

1997; Schwartz, 1994). Despite such concerns, however, it appears that most cross-cultural

research has tended to employ a ‘country-based’ definition of culture (Bigoness & Blakely,

1996; Schneider & De Meyer, 1991). This may be so, due to convenience, in that national

boundaries are easy to identify and offer an appropriate vehicle for segmenting work

behaviour. Differences in work behaviour that are culturally based, however, would exist

even if the world were not divided into nation states. Hence, differences in work behaviour

may not be due solely to variation in national culture values per se, but rather due to the life

experiences of those individuals within those cultures (Farley & Lehman, 1994).

More recently, Tan and Chong (2003) investigated the cultural dimension of Power Distance.

As stated previously, Power Distance may be defined as the degree of acceptance of unequal

distribution of power, which exists as a continuum in organisations.

In line with such understanding, therefore, organisations with high Power Distance tend to

have tall organisational hierarchies and greater differentiation in terms of salaries, perks, and

status symbols (e.g., ‘company car’). ‘Superiors’ tend to initiate most contact with their

subordinates, in which relations between them tend to remain relatively distant. Such

‘distance’ may be characterised by demonstrations of autocratic or paternalistic styles of

leadership within the organisation. Based on a sample of 104 Singaporean construction

employees, Tan and Chong (2003) investigated perceptions of Power Distance among such

individuals. Of the results which were gathered, perceptions of Power Distance tended to be

largely influenced by the organisational climate and employees’ value systems.


35

In the context of this research, organisational climate was defined in terms of such attributes

as organisational hierarchy (centralisation in decision-making, levels of supervisors, job

status), opportunities (to further education/upgrade skills, job advancement), organisational

learning, responsibility, reward systems (salary, fringe benefits), and spatial design and layout

of the office. In terms of the implications of such results in changing perceptions of Power

Distance within the ‘climate’ of an organisation, therefore, Tan and Cheng (2003) suggested

that only when employees felt valued were they likely to add ‘value’ to the organisation.

Although Hofsetde’s (1980, 1983) research entailed the examination of cultural differences in

work practices between countries, he also recognised that cultural differences existed between

groups within countries. Just as national cultures differ, there tends to be regional cultural

variation within a specific national culture, particularly if that culture is large and diverse

(Goodman, 1992). For example, a particular national society may be divided into subcultures

on the basis of ethnicity, language, religion, region, demographic, as well as socio-economic

characteristics. Of these, it has been suggested that geographic subdivision may be more

pertinent in defining subculture, as geographic place and culture tend to be closely related,

given that geography determines how individuals seek group affiliation in satisfying their

needs (Franklin & Steiner, 1992; Haviland, 1990). In support, based on a sample of 60

respondents from four Latin American countries (i.e., Brazil, Uruguay, Colombia,

Venezuela), Lenartowicz, Johnson, and White (2003) found distinct subcultures in self-

directed managerial behavioural traits (i.e., ‘capable’, ‘courageous’, ‘imaginative’,

‘independent’, ‘intellectual’, ‘open-minded’), within the Brazilian subcultures of São Paulo

and Rio Grande do Sul, together with the Columbian subcultures of Bogotá and Cartagena.

Further, it was also found that there was greater cultural similarity across, rather than within,

the national borders of the four Latin American countries. Based on the findings of such

research, therefore, it appears that the significance and influence of national culture upon

managerial behaviour remains relatively ‘border free’ (Clark, 1990).

Within the relevant research literature, differences in the organisational and national culture

of and between partner companies has been referred to as ‘cultural distance’, or alternatively

as ‘cultural divergence’. Such cultural differences may be the result of social norms, values

and underlying behavioural assumptions between differing partner companies (Doney,

Cannon, & Mullen, 1998). In turn, the level of ‘cultural distance’ may serve to facilitate or

inhibit partner companies’ motivation for open and prompt communication, in the cooperative

exchange and transfer of organisational knowledge, through the blending and harmonising of

differing organisational cultures.


36

Moreover, organisational and national cultural values, beliefs, and work practices may pre-

empt differing managerial beliefs and ways of communicating, in influencing how

expectations and cooperative activity is established and maintained, in the pursuit of mutually

agreed upon goals and objectives in project-based joint ventures (Bresnen & Marshall, 2000a,

2000b).

Differences in organisational and national culture, therefore, are likely to create

misunderstandings among workers, in terms of organisational work practices, procedures and

communication, thereby limiting the potential effectiveness of inter-company cooperative

activity and performance (Newman & Nollen, 1996). In support, based on a sample of 51

respondents, involved in international construction projects within Hong Kong, London, and

Sydney, Chan and Tse (2003) found that self-reported national cultural differences among

respondents, in terms of their perceptions of contractual arrangements and in resolving

disputes, actively contributed towards the development of dispute and management-related

difficulties. Specifically, this tended to be in terms of contractual arrangements, project-scope

definitions, together with generalised cultural clashes in communication and work practices.

Additionally, based on a sample of 170 managerial respondents, of small-to-medium sized

two-party joint ventures (involving raw material, financial services, import/export,

manufacturing, pharmaceuticals), Zeybek, O’Brien, and Griffith (2003) found that there was a

relationship between the national culture of respondents, communication, and project-based

joint venture performance. Therefore, as the perceived similarities in the national culture of

respondents increased, the perceived potential for miscommunication among workers

decreased. Furthermore, such a relationship tended to positively enhance self-reported

satisfaction with the level of project-based joint venture performance between partner

companies.

Of particular note, however, the methodological research design of Zeybek et al. (2003) did

not examine the effect of perceived similarities in organisational culture between partner

companies. This is particularly pertinent, given that organisational culture tends to

significantly influence the level of satisfaction and effectiveness of project-based joint

venture performance, in reducing inter-organisational conflict (Fey & Beamish, 2000). For

example, based on the increasing transitory demands of specific jobs, Bowen, Ledford, and

Nathan (1996) argue that core values and assumptions, which appear representative of

organisational culture, are likely to remain a relatively stabilising influence, as organisations

seek to take up new strategic directions through project-based joint ventures with other


37

partner companies. In addition, based on a sample of 245 managers and executive personnel,

Harris and Mossholder (1996) found evidence to suggest that discrepancies between,

individuals’ assessment of the current and ideal organisational culture, serve in explaining

individual differences in employee’s perceived organisational commitment and optimism

regarding the organisation’s future. Hence, organisational culture, in terms of the congruence

of individuals’ needs for achievement, affiliation, and power, in contrast with perceptions of

organisational supportiveness and bureaucracy in consultation and decision-making, has

important implications in accounting for such outcomes as job satisfaction, organisational

commitment, and an employee’s intention to stay.

2.5 Topographical, Political, Economic, and Cultural Influences Upon the Historical

Development of the Hong Kong Construction and Engineering Industry

Since the 1980’s increasing attention has been focused on understanding the organisational

and operational performance of international joint ventures within the Asia-Pacific region

(Au, Peng, & Wang, 2000; Yeung, 1994). This is partly due to the rapid economic growth of

the newly industrialised economies of Taiwan (ROC), South Korea, the People’s Republic of

China (PRC), India, Indonesia, Malaysia, Thailand, together with Hong Kong and Singapore

(Pangarkar, 1998; Sim & Ali, 2000).

Significant social, political and economic changes occurred with the handover of Hong

Kong’s sovereignty to the PRC in 1997. Unfortunately, limited information exists in regard to

the nature and development of project-based joint ventures between partner companies within

the Hong Kong construction and engineering industry since that time. This is particularly

important, given the competitive importance and the role of Hong Kong’s construction and

engineering industry to China’s own economic sustainability (Tallman & Shenkar, 1994;

White, 2002). The Hong Kong construction and engineering industry is renowned for many

unique features. These include: (i) its high level of business competitiveness in terms of

economic innovations and rapid development; (ii) confident ability to undertake vast

infrastructure projects; and (iii) the development of successful and complex joint venture

management and ‘Build-Operate-Transfer’ (‘BOT’) systems (Tam, 1999).

Before investigating the nature of some of these characteristics, however, it is essential to

acknowledge the legacy of Hong Kong’s own historical context as a British colony, and

currently, as a Special Administrative Region (SAR) of China. Namely, it is the political and

geographic legacy that has underscored much of the history of Hong Kong, and its unique and


38

dynamic construction industry (Buckley, 1997; Tsang, 1997). For example, between 1986 to

1993, it was estimated that the economic growth and output of Hong Kong’s construction and

engineering industry constituted 35% to almost 60% of the territory’s capital investment per

capita (Walker, 1995). In addition, it has been documented that this construction sector

employs approximately 8% of the total workforce of Hong Kong (Ministry of Construction,

1999). The significance of the construction and engineering industry upon the economic

growth of Hong Kong cannot be ignored or underestimated, despite recent statistics indicating

that the gross value of construction work performed by main contractors decreased by 6.9%

in nominal terms compared with 2000, to HK$27.6 Billion in the second quarter of 2001. On

the other hand, manpower requirement in “Construction” is projected to grow at an average

annual rate of 0.5% over 2001-2007, maintaining its 9.5% share of total workforce. (Census

and Statistics Department, the Government of the Hong Kong Special Administrative Region)

A critique of Hong Kong’s history over the past 160 years suggests four major factors have

been a driving force behind the development of this country’s construction and engineering

industry. These include topographic, political, economic and cultural influences. Each of

these factors has had a profound impact on the development of Hong Kong’s construction and

engineering industry, and will now be discussed in more detail (Flanagan & Li, 1997;

Ministry of Construction, 1997). The topographic features of Hong Kong are world-renowned. For example, the geographic

location of Hong Kong Island, with its sheltered but deep natural harbour, sitting opposite the

Chinese mainland, was ideally suited to subsequent military occupation by the British Royal

Navy, together with the establishment of an amenable trading port from the first days of

settlement in the early 1840’s (Ngo, 1999). Thus, the British navy and military represented

important clients to the economic growth and success of Hong Kong, as were the merchants

who quickly established trading houses. As advantageous as the Island was through merchant

trading, there were also notable and major drawbacks. Namely, the immediate success of

Hong Kong and its ever-increasing population demanded improved and sustainable housing,

sanitation and roads (Carroll, 1999; Evans & Tam, 1997). Subsequently, in 1851, the British

Government acquired full political sovereignty of Hong Kong.

Historically, the socio-political context of Hong Kong has been largely shaped by both British

and Chinese influences (Chan & Postiglione, 1996; Ping-Keung, 2000). As social and

political change swept across mainland China, the population in Hong Kong surged as

increasing numbers of refugees flooded across the border. Of particular significance were the

Opium Wars of the 1850’s/1860’s, the Boxer Rebellion in 1900, the Revolution of 1911 that

Comment [U1]: Tony Walker wanted this added.... updated economic figures etc


39

ended imperial rule, and the Communist Revolution led by Mao Tse Tung in 1949. Each of

these historic events saw thousands fleeing across the borders into Hong Kong. In the 1970’s,

with the opening of the ‘Special Economic Zones’, the modern era began, which resulted in

the bipartisan establishment of economic development and cooperation in relation to the Pearl

River Delta. Finally, British sovereignty over Hong Kong ended in 1997, Hong Kong

reverted to Chinese rule, and the ongoing changes continue to effect the construction and

engineering industry in Hong Kong (Meyer, 2000).

Alongside the military, the most significant early client of the construction and engineering

industry was the Hong Kong Government (Chiu & Hung, 1999). The public sector

construction and engineering requirements accounted for approximately 40% of all

government expenditure (Sung, 1996). The need, largely created by an ever-increasing

population, in terms of housing, sewerage, public transport and other public services, has

sought to further fuel the growth of the Hong Kong construction and engineering industry.

From the initial days of settlement, the geography of Hong Kong gave it an enormous

economic advantage in trading with China (Choi, 1999; Lee, 1999). Such advantages were

quickly seized upon by talented individuals from all corners of the British Empire and from

the flow of Chinese citizens into the colony, in light of the ‘laissez-faire’ economic policies of

the colonial governments, which encouraged talent and business growth (Chiu, 1997; Ngo,

1999). From the start, Hong Kong was a place that created wealth, both for the British

Government and the individual. Such wealth sought to facilitate growth, and construction was

both the tool and the result of this wealth.

The fourth major area of influence upon the development of the Hong Kong construction and

engineering industry was cultural, which stems from the unique migration of people of

diverse and varying nationalities (Buckley, 1997). The migration of those from westernised

nations, particularly from the British Empire (including India and the subcontinent), Europe,

America, together with China, have resulted in a culturally diverse construction and

engineering workforce. As a result, organisational management have had to adapt to and

account for differences in the nationality and ethnicity of relevant personnel in the timely

completion of Hong Kong construction and engineering projects. For example, built between

1847 to 1849, St John’s Cathedral in Central Hong Kong (which presently stands today) was

jointly financed by both Government and private means, the building was organised by the

Government’s Surveyor-General (now termed the ‘Secretary of Works’), and constructed by

Chinese contractors under the direct and predominant jurisdiction of Western architects and

civil engineers (So & Kwok, 1996).


40

From the 1850’s through until the end of World War I, Hong Kong witnessed uninterrupted

growth, which further consolidated Hong Kong’s role as a major trading port (Choi, 1999;

Lee, 1999). The Government during this period undertook significant construction projects.

These included the original Government House, as well as Pokfulam Reservoir, which is one

of the oldest in the Territory. Moreover, the completion of the Peak Tram in 1888, led to the

construction of imposing private homes and mansions on the Peak. Further, in 1886, the first

great commercial symbol of Hong Kong was completed, this being the original headquarters

of the Hong Kong and Shanghai Bank in Central Hong Kong.

Land reclamation in Hong Kong commenced in 1851. Since that time, Hong Kong has been

long recognised as a world leader in innovative regional development (Tsang, 1997).

Stringently driven by the increasing pressure of population growth, the Hong Kong

government began a major reclamation of Victoria Harbour, which took approximately 15

years to complete (1889 to 1904). During this period, over three major city blocks were

created, and the original ‘Des Voeux Road (Praya)’ became an inland city street. Further,

‘Hong Kong Land’ developed the square of reclaimed land between Pedder and Ice House

Streets, thus setting a pattern that would progressively continue and evolve for the next 100

years.

At the same time, on the Kowloon side of the Harbour, increasing population pressures made

the development of the Kowloon-Canton Railway a necessity. This was completed in 1905

(Meyer, 2000). Such business activity added enormous impetus to the growth of the Kowloon

Peninsula, including its leading thoroughfare, Nathan Road, which was finished in 1911. By

the time of its completion, the Kowloon-Canton Railway witnessed the importation of

‘foreign’ contract labour from India, Italy and South Africa for the Tunnel Works

construction of the Kowloon-Canton Railway.

In the decade following World War I, there was a progressive slowdown in the output and

pace of the Hong Kong construction and engineering industry. Not until the 1930’s, did the

industry rebound with the Hong Kong and Shanghai Bank’s decision to build new corporate

headquarters in Central Hong Kong (Po-Keung, 1999). This commercial construction project

was significant not only for its confident undertaking during the Depression, but as one of the

earliest examples of construction project management, a concept which is believed to have

originated in the United States during the 1960’s. This commercial project was undertaken by

a company of civil engineers who managed the construction, and then divided the work into


41

specialised jobs awarded to individual and specific contractors. Further, such a project

involving the construction of the Hong Kong and Shanghai Bank’s new corporate

headquarters, witnessed one of the earliest uses of industry technology to install air

conditioning and to be constructed utilising a steel-framed structure. It also initiated the

tradition of Hong Kong’s great economic institutions in constructing internationally famous

landmarks (Buckley, 1997).

By 1935, however, there were still many social problems in Hong Kong such as limited

housing, sewerage and water supplies which required considerable public investment in

construction in order to provide amenable solutions, pressures which were further exacerbated

following World War Two (Lui & Chiu, 1999). For example, tenement-type housing for

160,000 persons, and European-type housing for 7,000 persons, suffered destruction or

serious damage during the years 1941 to 1945, mainly as a result of looting and Allied aerial

bombardment. Furthermore, the Communist Revolution in China in 1949 created a massive

refugee crisis in Hong Kong. Hence, the construction of emergency housing became an

urgent necessity in need of addressing.

In the 1950’s, ‘The Housing Authority’ was established in Hong Kong, assigned with the

political mandate of providing residential housing on a scale unparalleled elsewhere in the

world (Chiu & Hung, 1999; Tsang, 1997). Between 1954 and 1973, ‘The Housing Authority’

built residential flats for over 244,000 people and created seven new towns, the first being

‘Tsuen Wan’, together with two public housing estates at North Point and Wah Fu in

Aberdeen, on the southern side of Hong Kong Island. At the time, Wah Fu was considered to

be one of the most densely populated places in Hong Kong. Such housing estates were

entirely self-sufficient residential zones, which included shopping complexes, banking

facilities, markets, restaurants and amenable public transport. Over the next twenty years,

‘The Housing Authority’ built over 250 estates and 800,000 residential flats. Subsequently,

such demand provided the foundation for a thriving and competitive construction and


Commencing from the 1950’s until the mid-1970’s, the range of construction projects

continued to expand and diversify (Choi, 1999). For example, the Hong Kong Colosseum, the

Queen Elizabeth Stadium, Universities, the Cultural Centre on the tip of the Kowloon

Peninsula, together with the Academy of Performing Arts in Wanchai were explicit

testimonies to the breadth of Hong Kong’s prestigious and well-regarded cosmopolitan


42

lifestyle. Further, Hong Kong has long had a reputation for rebuilding itself every 25 years

(Kwong, 1996).

During the 1970’s, the decade which had witnessed the start of the ‘modern’ era in Hong

Kong, came to a close, marked largely by the innovative construction projects, which had

significantly altered the architectural and geographical landscape of Hong Kong (Buckley,

1997). For example, in 1972, the Cross Harbour Tunnel was complete, and in 1973, Jardine

House on Hong Kong Harbour became the first towering high-rise to change the skyline.

In addition, the 1970’s witnessed the ambitious undertaking of the Mass Transit Railway

Corporation. Some twenty-six stations were built from 1975 to 1985, comprising over 35

kilometres of overground and underground railway. Furthermore, more than 20 civil

engineering contractors were used simultaneously using a multi-contractual basis of project

management. It represented an example of the unique contracting system, which Hong Kong

had created, characterised by a diversified balance of contractors of varying national cultural

diversity. Whereas ‘local’ contractors were responsible for the above groundwork, ‘foreign’

contractors managed the underground, reclamation and tunnel work.

This contracting system, however, was not simply an understood ‘tradition’. Rather, it was

regulated by complex and codified government rules and procedures. Namely, all contractors

were categorised into one of two Lists either for ‘locals’ or ‘foreigners’ (Ministry of

Construction, 1997). Under List I for ‘locals’, there were five different categories graded by

the government. These included: Building, Port Works, Road and Drainage, Site Formation,

and Water Works. This ‘List’ was subsequently divided into different groups according to

fiscal size and value. Groups ‘A’, ‘B’ and ‘C’ comprised contractors who could tender for

work up to the fiscal value of HK$6 million, HK$30 million, or contracts of unlimited size,

respectively.

Alternatively, List II was for ‘foreign’ contractors whose regional headquarters were located

outside of Hong Kong. All List II contractors were restricted to projects with a contract value

over and above HK$30 million. Although this brought them into competition with Group ‘C’

‘local’ contractors, such a system remained extremely successful in that it resulted in the

development of project-based joint ventures which Hong Kong is renowned for.

Of particular significance, however, project-based joint ventures provided both List I and II

contractors with opportunities to maximise their involvement on public and/or privately


43

funded construction projects of varying size and complexity (Walker, 1995). List I and II

contractors maximise the strengths and advantages of collaboratively working alongside each

other. Whereas the List I contractors brought ‘local’ workforce and knowledge, the List II

contractors enjoyed the benefits and advantages of the ‘no-tariff’ policy of the Hong Kong

government regarding the importation of ‘foreign’ goods, as well as equipment and services

by ‘foreign’ companies. Furthermore, many ‘foreign’ contractors sought to become

‘localised’ through the development and establishment of permanent regional headquarters in

Hong Kong, thus becoming eligible for List I status and access to further areas of work.

Many of Hong Kong’s largest construction companies having different origins and are

generally part of large corporations with headquarters outside Hong Kong. It is these

construction companies with their overseas headquarters that are described as foreign

construction organisations (Walker, 1995). Some of these companies participated in this

research. Foreign construction organisations can be best described as those companies that

transfer senior foreign nationals from their home countries, in this case French executives for

Dragages, Japanese executives for Nishimatsu and PRC Chinese executives for China

Harbour, to manage and control their business interest in Hong Kong. Whilst all these

companies employed senior expatriates, both local Hong Kong Chinese and non Chinese,

neither of these persons were included on the executives boards of any these companies. This

“foreign” definition also extends to these companies who remit either all their gross turnover,

in the case of Nishimatsu to their head office in Japan, or profits or losses for use in their

home countries. Nishimatsu, whilst classified as a local company in Hong Kong, who pay

their share of Hong Kong taxes, are also required, as part of the global Nishimatsu Company,

to pay taxes in Japan based on their overall worldwide turnover and expenses. Taxes paid in

Japan are offset with the taxes paid in Hong Kong. Similar principles and arrangements

applied to Dragages and China Harbour. From a taxation and profit perspective, joint ventures

are a combination of two or more entities that have formed an alliance for the purpose of

entering into a specific business transaction, not to exist into perpetuity but in order to make a

profit. The taxable income or loss is passed through to the partners who report it in their

respective tax returns. Therefore, most joint ventures incur no separate tax and the income or

loss generated by the ventures incurs no separate tax. Avoiding double taxation in this way is

usually the goal of joint venture participants (J.Morris, 1987). It is this type of arrangement

that Dragages, Nishimatsu and China Harbour Engineering generally followed and adopted

with the approval of the Hong Kong Department of Inland Revenue.


44

Under the project-based contracting system, the pace of construction in Hong Kong

accelerated with the economic boom of the 1980’s (Meyer, 2000). During this period of

commercial prosperity, the high-rise office towers appeared on the waterfront, becoming

famous landmarks in themselves. Such examples included: the Bond Centre (renamed the

‘Lippo Centre’), the new Standard Chartered Bank Headquarters in Central, Exchange

Square, as well as the new Hong Kong and Shanghai Bank Headquarters, which represented

an example of the skilful integration of ‘local’ and ‘foreign’ workers, contractors and

suppliers. Perhaps the most famous building of this period was the 70-storey Bank of China

office tower—at the time of its completion was considered to be the tallest office building in

the world outside of the USA.

Throughout the last twenty years, the topography of Hong Kong continued to provide

seemingly daunting challenges. For example, as huge container terminals were built to meet

the demand created by the growth of the emerging economic growth of China, reclamations

of land continued all along the western end of Victoria Harbour (Carroll, 1999). Thus, right

from the beginning of Hong Kong’s colonial history, this region continued to be ‘burrowed,

tunnelled, and manipulated’ by large and complex construction and engineering infrastructure

projects.

No construction project has been as challenging as the Chek Lap Kok Airport, which was

built in the 1990’s (Baran, Pan, & Kaynak, 1996). Designed to handle 85 million passengers

and 8.9 million tonnes of cargo per year by 2040, this vast undertaking involved reclaiming

75% of the 1248-hectare airport platform from the sea, together with the construction of new

railways, highways, bridges and a residential town for 20,000 citizens. Moreover, the airport

railway comprised 35 kilometres of road, including 8 kilometres of tunnels, and 6 kilometres

of elevated structures. Furthermore, the Lantau-fixed crossing included the longest-span

suspension bridge in the world (i.e., 2.2 kilometres), in carrying both rail and road traffic.

Concurrently, construction and engineering companies in Hong Kong have continued to build

container terminals, including the Western Harbour tunnel, Tsing Yi Bridge, and a complex

series of highways across the New Territories to service the increased traffic volume of

people and commerce with mainland China during the 1990’s (Hong Kong Government,

1992; Zhang & Kumaraswamy, 2001). At present, the ‘New Hong Kong Tunnel Company

Limited’ currently holds the franchises with which to construct and operate the combined

road and rail tunnels between Kwun Tong and Quarry Bay, until 2008 and 2015, respectively.


45

Hong Kong continues to rapidly develop in response to the demands of a large population in a

relatively small area. In part, this appears fuelled by the increasing political and economic

activity within the construction and engineering industry, through its proximity to the Pearl

River Delta. Furthermore, consistent with pro-business ‘laissez-faire’ economic traditions, the

sustained initiatives of the Hong Kong SAR government have allowed for increased

flexibility, profitability, commercialisation, private finance and collaboration between ‘local’

and ‘foreign’ contractors within the construction and engineering industry (Ngo, 1999;

Walker, 1995). Project-based joint ventures are alive and well in post-1997 Hong Kong.

2.6. Relationship-Based Procurement of Contracts and the Strategic Positioning of

Joint Ventures within the Hong Kong Construction and Engineering Industry:

Implications for Understanding the Congruence between Organisational Development

and Managerial Practice.

According to Tam (1999), there exist a number of inherent motivations in forming project-

based joint ventures in the construction and engineering industry. Apart from the provision of

sufficient financial strength to participate in very capital-intensive infrastructure projects, one

is to reduce risk exposure to clients.

In the establishment of project-based joint ventures with other companies, however, there

may be other notable and significant risks. Bing, Tiong, Fan and Chew (1999), list such risks

as comprising: (i) inheriting a partner’s financial problems; (ii) having disagreements

regarding accounting standards; (iii) distrust between employees; (iv) changes in policy

between partner companies involved in the project; (v) lack of management competence; (vi)

disagreements about staff task allocation and responsibilities in the project team; as well as

(vii) organisational knowledge management disputes.

Significant problems, however, may also arise from perceived cultural differences stemming

from companies not adequately understanding the political pressures facing their partners

(Bruton & Ahlstrom, 2003). For example, consistent with the philosophical underpinnings of

institutional theory and the influence of neo-classical economics, the venture capitalist goals,

beliefs, values, behaviour (and subsequent investment in partnership-based joint ventures with

culturally diverse multinational corporations) tend to be influenced by the presiding norms of

corporate governance in regulating economic activity (North, 1990; Roy, 1997; Suchman,

1995).


46

It also remains feasible that joint venture partners risk being implicated in their partner’s

reported corruption and/or illegal activity due to either poor definition or misguided

interpretation of regulatory laws and industry-based standards of practice, as applicable to the

project. Most notably, recent examples of such problems have been provided in the literature

regarding joint ventures working within China (e.g., Luo, 2001; Wang, Tiong, Ting &

Ashley, 1999), as well as the former Soviet Union (e.g., Munns, Aloquili & Ransay, 2000).

Thus, when considered from this cultural perspective, it is apparent that the dynamic nature of

the joint venture relationship is complex.

Moreover, multinational companies may also establish joint ventures as a means to

temporarily merge strategic assets that they may subsequently use together in a collaborative

and collective manner in order to satisfy the needs of stakeholder organisations and salient

parties (Matthews, 1999). Complexity then inevitably emerges from the potentially diverse

intrinsic and extrinsic motivations of various partners; as well as from the ensuing history and

reputation each partner shares with other stakeholders. This may comprise and involve

partners within the supply chain who represent subcontractors, ‘the client’ and other

stakeholders who may not otherwise be immediately visible or vocal. Subsequently,

secondary or hidden stakeholders, such as ‘the public’, may exert considerable influence

through protest actions, political influence or other indirect action that can critically influence

project performance and success (Briner, Hastings & Geddes, 1997; Cleland, 1999).

In support of this, based on a meta-analytic review of 12 previous international joint venture

(IJV) studies, Beamish and Delios (1997) found that between 32% to 61% of the IJV’s had

unsatisfactory or otherwise ‘poor’ performance, defined in terms of measurable conflict

between partner companies. Hence, ascertaining differing types of corporate culture in terms

of managerial and organisational practices that are likely to facilitate and optimise the nature

of the inter-parent relationship remains crucial to joint venture success.

Thus, joint venture and alliance partners assume risk as a result of their alliances with other

partner organisations. Furthermore, each joint venture member has overt and covert links to

relevant stakeholders as well as other client groups. There may also be complexity involved

in the interaction between different dominant organisational or national cultures. However, it

should be noted that all reported differences and complexities associated with organisational

diversity tend to be dealt with or subsumed for the duration of the joint venture relationship.


47

The relationship between joint venture partners has to be strategically and operationally

designed and managed. In fact project management skills are required to successfully

undertake this design process. For example, alignment is sought when selecting a joint

venture or alliance partner. Alignment is achieved when a potential partner is perceived as

being able to appropriately match what a potential partner seeks. Part of the process of

achieving alignment is to identify competency gaps in knowledge management-based

practices within each potential partner company. These gaps are filled when the alignment is

achieved. (Saloner, Shepard & Podolny, 2001).

Subsequently, this process forms part of a scoping and needs analysis phase, which can be

seen as part of a broader briefing or team development stage. In fact, Engwall and Jerbrant

(2003) found evidence to identify the significance of resource allocation management as

crucial to the operational success of enacted and negotiated projects. Their findings were

based on the results of qualitative case-based research investigating key and existent

management challenges, which contingently operate within the context of a multi-project

environment.

In the context of this research, semi-structured in-depth interviews were conducted between

April, 1998 and June, 1999 within the contractual division of a major supplier of signalling

systems for railways, and subsequently, in the research and development division of a middle-

sized private telecom operator. Subsequent findings revealed the importance of such key and

important aspects as project inter-dependency in terms of resource allocation, decision control

and associated problem solving with which to ensure and envisage project success.

Additionally, forming joint venture relationships in this climate requires risk management

skills. Contractual risk management in dispute resolution and avoidance is a core competence

of project management, particularly within developing countries. Technical, legal, logistic,

social, economic, financial, and/or commercial management-related risk problems need to be

resolved and these subsequently affect joint venture performance in terms of the subsequent

lack of management skills, organisational learning, knowledge transfer or low levels of

productivity (Baloi & Price, 2003; Jannadia, Assaf, Bubshait & Naji, 2000).

Moreover, the development of mutual exchange of trust and consensual commitment in joint

venture relationships represents another important project management skill that has also been

more recently recognised (Luo, 2002a; Zaghloul & Hartman, 2003). This is particularly true

in the context of decision-making risk and risk allocation within project-based joint ventures


48

because differing cultural values may pre-empt differing managerial beliefs and ways of

communicating. These influence how expectations and cooperative activity is established and

maintained when pursuing targeted and mutually agreed upon goals and objectives (Bresnen

& Marshall, 2000a, 2000b). Chan and Tse (2003) provide a useful illustration of this through

their survey of 51 respondents involved in international construction projects within Hong

Kong, London and Sydney. Their questionnaire was based on a sample of 10 “yes/no”

questions administered between June 1998 and September 1999. They found that self-

reported cultural differences among respondents in terms of their perceptions of contractual

arrangements and in resolving disputes, actively contributed towards the development and

enactment of dispute and management-related difficulties in international construction

projects. These difficulties were specifically related to the appropriation of contractual

arrangements, project-scope definitions as well as generalised cultural clashes. There will

usually be some degree of uncertainty associated with the initial establishment and

development of project-based joint ventures between multinational construction companies.

Thus, inter-organisational commitment needs to be openly and publicly expressed through the

deployment of open and reciprocal channels of communication among and between all levels

of staff. This can result in new ideas central to the organisational knowledge-based

philosophies being integrated and shared by companies involved in the negotiated joint

venture (Burgess & Turner, 2000).

Differing cultural values, defined in terms of values, beliefs and assumptions unique to a

particular national culture and the particular individual’s background, are likely to create

misunderstandings thereby limiting the potential effectiveness of company performance

(Newman & Nollen, 1996). Thus, understanding the need for “fit” of cross-cultural

communication underlies the effectiveness of coordinating activities that contributes to a

company’s project performance delivery. Research findings of Zeybek, O’Brien and Griffith

(2003), based on a sample of 170 managerial respondents from small-to-medium sized two-

party international joint ventures (involving raw material, financial services, import/export,

manufacturing, pharmaceuticals, etc. located in Almaty, Kazakhstan) concompanies this need

for cultural fit. They found that as perceived national cultural congruence in the international

joint venture (IJV) increased, the perceived potential for miscommunication decreased, as did

the likelihood of influence rather than content-based communication strategies, thereby

influencing the partner’s self-reported IJV performance. Although these findings argued a

relationship between similarities in national culture and partner’s self-reported IJV

performance, their methodological research design did not allow for an examination of the

effect of organisational cultural congruence. This is particularly relevant because it has been


49

recently argued that organisational culture tends to significantly influence the presiding nature

and contextual effectiveness of IJV performance in reducing subsequent inter-organisational

conflict (Fey & Beamish, 2000).

Based on the findings of the relevant literature, individual differences in organisational

culture and perceived commitment of staff toward the project-based joint venture appear to

represent key variables that may influence the effectiveness of project-based joint venture

performance within the construction and engineering industry of Hong Kong. This seems

likely within the context of such knowledge-based management operational indices as inter-

organisational trust, commitment, inter-company cooperation, decision-making practices,

strategic fit and competitive advantage. Limited data exist, however, that helps us understand

the interactive way that project-based joint ventures between multinational contractual

companies within the Hong Kong construction industry function in practice. Consequently,

this presents a knowledge gap that needs to be filled to provide a culturally appropriate model

with which to inform and facilitate collaborative practice when developing, establishing and

maintaining project-based joint ventures within the Hong Kong construction and engineering

industry.

2.7. Understanding Project-Based Joint Venture Performance: Organisational/National

Culture vs. Organisational Commitment In light of the organisational and national culture of partner companies, therefore, the notion

of employees’ commitment to their organisation has long been considered a topic of interest

to organisational researchers. An understanding of employees’ organisational commitment, as

relevant to project-based joint venture performance, is particularly important within the

context of international management. This is because the concept of organisational

commitment, in terms of the job performance of employees, reflects not only the nature of the

tasks being undertaken, but also interpersonal, task, and achievement-oriented motivational

components (Campbell, 1990). According to Triandis (1994), high levels of achievement

motivation have been linked with individualism, and low achievement motivation with

collectivism. This is because both individualism and achievement motivation emphasise

personal (versus group) achievement and task (versus social harmony) orientations.

Alternatively, however, this is not to suggest that collectivists have lower achievement

motivation, relative to individualists, particularly if the construct of collectivism is broadly

conceptualised to include both personal and group attainment. Hence, it is likely that the

outcomes of employee-related behaviours may impact upon such organisational citizenship

behaviours as job dedication, interpersonal facilitation, and political climate within and


50

between the partner companies, thereby either benefiting or inhibiting the overall

performance of the project-based joint venture (Witt, Kacmar, Carlson, & Zivnuska, 2002).

Dating back to the 1960’s, the concept of organisational commitment has tended to be

conceptualised in a variety of ways within the North American literature. One approach has

been to consider organisational commitment in terms of the relative strength of employees’

identification, acceptance, belief and attachment with the organisation’s goals and values

(Mowday, Steers, & Porter, 1979). On the other hand, other researchers have viewed

organisational commitment as the employees’ willingness to exert effort, on behalf of, as well

as maintain membership of the organisation (Meyer, Allen, & Smith, 1993). Furthermore,

notable attention has tended to concentrate on identifying the possible antecedents and

consequences of organisational commitment. Organisational attributes, job details and

personal characteristics have been investigated as possible antecedents. In addition, job

turnover and job performance have been examined, as resultant consequences of

organisational commitment. It appears that the most important attitudinal work-related

factors, which have been, identified in human resource management practices, however, tend

to be job satisfaction, organisational commitment, and the turnover intention of employees. In

terms of the inter-relationships between these work-related variables, it has been suggested

that job satisfaction and organisational commitment are reciprocally related, of which, both

appear to influence the job turnover intention of employees.

According to Meyer and Allen (1991), organisational commitment may be characterised by

three separate dimensions. These are: affective, continuance, and normative commitment.

Affective commitment refers to the emotional attachment of employees to the organisation.

Continuance commitment is associated with the perceived cost to employees of leaving the

organisation. Normative commitment may be regarded as the obligation of employees to

remain with the organisation. Furthermore, normative commitment develops from

organisational commitment norms, which may either develop pre-entry (through familial and

cultural socialisation) or post-entry (through organisational socialisation), or appear predictive

of positive organisational outcomes for employees. It may be argued, however, whereas

normative commitment, which develops out of internalised personal norms may lead to

desirable work outcomes, normative commitment which develops out of feelings of

obligations toward others may be more likely to engender feelings of employee resentment.


51

Within the relevant research literature concerning organisational commitment, it appears that

most attention tends to have focused upon examining both affective and continuance

commitment within the culture of an organisation (Shore, Tetrick, Shore, & Barksdale, 1999).

In part, this may be because affective commitment tends to develop from positive work

experiences, such as job satisfaction and organisational fairness. As such, it is less associated

with lower levels of withdrawal behaviours including employee absenteeism and tardiness

(Allen & Meyer, 1996). Continuance commitment, however, tends to be influenced by

employees’ lack of job alternatives, or anything that increases employees’ chance of leaving

an organisation due to investment within another company through time, money, and/or

effort. Hence, continuance commitment relates directly to the need to stay with the

organisation, and is not thus related to positive organisational or individual outcomes. Among

individualistic cultures, therefore, the priority of individual goals over group goals only exists

to the extent that the employee feels his or her commitment toward the organisation is to his

or her advantage (Allen, Miller, & Nath, 1988). In collectivistic cultures, however, the

relationship between employer-employee relationship within an organisation tends to contain

embedded moral overtones, wherein mutual obligation and loyalty are regarded as reciprocal,

and change of employment is socially disapproved of, as is firing due to poor performance

(Hofstede, 1991).

Based on a sample of 891 Turkish private sector employees (487 males, 404 females), Wasti

(2002) examined the antecedents and consequences of affective and continuance commitment

upon the work practices and personal experiences of such individuals. In regard to Turkey

being a predominantly collectivistic culture, it was proposed that this would generate

expectations of employee loyalty towards the organisation, together with associated perceived

costs in the violation of such expectations. Of the sample which was gathered, the modal age

was 25 to 29 years, and 74% of the respondents had furthered their education beyond high

school. Furthermore, 32.5% were office workers, 19.5% were supervisors, 15% were

professionals, 14% were managers, and the remaining 8% comprised ‘blue-collar’ workers.

The modal tenure of workers within the sample was 1 to 5 years (45%).

In the methodological design of the research conducted by Wasti (2002), participants were

administered a variety of measures. These included measures of Affective and Continuance

Commitment (Meyer, Allen, & Smith, 1993), Satisfaction with Work (Smith, Kendall, &

Hulin, 1969; revised by Roznowski, 1989), Turnover Intentions (as given by three items

assessing Work Withdrawal; Hanisch & Hulin, 1990, 1991), Subjective Well-Being (Diener,


52

1984; Diener, Emmons, Larsen, & Griffin, 1985), as well as Allocentrism and Idiocentrism

(Singelis, Triandis, Bhawuk, & Gelfand, 1995). The latter measure, which was used to assess

employee-related Allocentrism and Idiocentrism, was composed of four 8-item subscales.

These comprised Horizontal Individualism, Vertical Individualism, Horizontal Collectivism,

and Vertical Collectivism. In support, Triandis and Gelfand (1998) show that Individualism

and Collectivism cultural dimensions can be further delineated within an organisation as

‘horizontal’ (emphasising ‘equality’) or ‘vertical’ (emphasising ‘hierarchy’).

Hence, items which were reflective of such constructs as Allocentrism and Idiocentrism, were

thus used to assess respondents’ level of Collectivism or Individualism, as regards their

preferential extent in working either by themselves and/or with others, through shared and

equitable consultation in organisational decision-making and work practices.

Although there was differing endorsement of collectivist cultural values from results obtained

among the sample, Wasti (2002) found that affective commitment tended to be a function of

positive work experiences, as well as desirable work and personal outcomes. Besides the

significance of employees’ investments in the organisation and perceived lack of work

alternatives, loyalty norms and generalised approval of the employee’s in-group increased the

continuance commitment of respondents.

Furthermore, among allocentrics, as compared to idiocentrics, the influence of loyalty norms

and in-group approval tended to be stronger, together with that of more positive job

outcomes, as regards lower levels of turnover intentions and work withdrawal (e.g.,

neglecting assigned duties, tardiness). Within a collectivist culture such as Turkey, therefore,

where the employer-employee relationship is regarded as more personal and long-term

oriented, loyalty norms significantly increased the continuance commitment of employees.

Consistent with there being a degree of market and cultural uncertainty associated with the

development and establishment of project-based joint ventures between companies,

organisational commitment thus needs to be openly expressed through the interchanged

deployment of reciprocal channels of communication among and between all levels of staff.

Specifically, this is to allow new ideas to become integrated and accepted, as central to the

organisational knowledge-based philosophies, which remain shared by companies who are

involved in the project-based joint venture (Burgess & Turner, 2000).


53

2.8. Understanding Project-Based Joint Venture Performance: Organisational/National

Culture vs. Inter-Organisational Trust In light of perceived differences in organisational and national culture, inter-organisational

trust is central to project-based joint venture performance. Most notably, concepts such as

inter-organisational trust and organisational commitment tend to be closely related in

practice—these mutually reinforce mutual competitiveness of inter-company partnerships.

Also, inter-organisational trust tends to be based upon beliefs of how partner companies will

or will not behave in their relationship (Cullen, Johnson, & Sakano, 2000). The literature

supports inter-organisational trust as representing an important independent variable (‘cause’)

of joint venture performance in terms of enhanced cooperation, cost savings, capability

improvement, and increased strategic flexibility between partner companies (Mayer, Davis, &

Schoorman, 1995; Saxton, 1997).

Inter-organisational trust may also be regarded as a psychological state in that it comprises the

volitional intention to accept vulnerability, risk, and reliance, based on positive expectations

of the intentions and/or behaviour of another organisational company (Rousseau, Sitkin, Burt,

& Camerer, 1998). In turn, it is also recognised that inter-organisational trust represents a

multi-dimensional construct, characterised by cognitive and affective components, as well as

macro (inter-organisational) and micro (interpersonal) elements (Sheppard & Sherman, 1998).

Whereas ‘cognitive’ trust is based on rational choice (i.e., a belief that the other party will

perform an action that is beneficial), ‘affective’ trust relates to the emotional attachment

caused through the reciprocation of interpersonal care and concern by the other party

(McAllister, 1995). Inter-organisational trust, therefore, refers to the confidence in the intent

and ability of partner companies to positively meet their obligations and offer organisational

knowledge contributions towards the inter-company partnership. Therefore, inter-

organisational trust may be regarded as an economically and socially embedded phenomenon,

which in turn is shaped by environmental, organisational and individual contingencies,

including market uncertainty and resource interdependence, due to partner companies’

behaviour and expressed commitment towards the project-based joint venture (Rousseau et

al., 1998).

So it can be said that inter-organisational trust represents an important variable of joint

venture performance in facilitating norms of group inclusion, toward furthering the

commitment of partner companies to develop, establish and maintain a cooperative

relationship with one another (Zaghloul & Hartman, 2003).


54

Further, inter-organisational trust is particularly important, given decision-making risk within

project-based joint ventures between the different partner companies. In other words inter-

organisational trust relies upon the importance of mutual interdependence and inter-partner

organisational learning in facilitating mutual competitive advantage. More specifically, this

relates to the administrative and coordination costs which tend to be associated with the

shared control and transfer of organisational resources and knowledge in the management of

the project-based joint venture between partner companies (Parkhe, 1993).

Inter-organisational trust, however, may be influenced by other institutional, organisational

and individual factors. According to Zaheer, McEvily, and Perrone (1998), such factors may

include: (i) alliance age; (ii) ‘cultural distance’ between partner companies; (iii) market

uncertainty; (iv) resource interdependence; (v) risk commensuration; and (vi) reciprocal

commitment. First, in regard to alliance age, it has been demonstrated that ‘new’

organisations tend to be more susceptible to financial risk and failure, particularly in terms of

their perceived liability of both ‘foreignness’ and ‘newness’ within merging business markets

(Yan & Gray, 1994). This is because organisational routines tend to be rarely neither perfect

nor stable, as characterised by the irregularity of the nature of organisational politics and

interpersonal working relationships within such an environment. Hence, inter-organisational

trust tends to play a more pivotal role in offsetting competitive disadvantage, as well as

through enhancing the coordination and transfer of organisational learning between partner

companies, in contributing to joint venture performance (Fichman & Levinthal, 1991).

Within the relevant research literature, the concept of ‘cultural distance’ (or ‘cultural

divergence’) between partner companies tends to have been operationally defined in a number

of different ways. Whereas some researchers (e.g., Newman, 1995) have defined and

measured ‘cultural distance’ along the lines of Hostede’s (1980, 1983) dimensions, others

have sought to measure ‘cultural distance’ in terms of perceived differences by using the

nationality of respondents as a proxy for the concept of ‘national culture’ (e.g., Ahmed & Li,

1996). Common to such research studies that have examined the impact of culture upon joint

venture performance, however, is that whereas national ‘cultural divergence’ tended to be

associated with organisational difficulties between partner companies, such a situation

improved when ‘cultural divergence’ was reduced. More specifically, ‘cultural divergence’

was defined in terms of items which referred to the ability to communicate, to develop trust,

and to share a compatible management system, thus reducing the likelihood of organisational

uncertainty, conflict and opportunism between partner companies within the project-based

joint venture (Williamson, 1993).


55

Accordingly, it may be argued that the likelihood of fewer national cultural differences

between differing partner companies may serve to facilitate open and prompt communication.

Hence, when the perceived level of ‘cultural distance’ between partner companies becomes

shorter, it is likely that the blending and harmonising of the differing organisational cultures

will become easier. Specifically, this may be through the development and establishment of

common values and norms, which serve to otherwise strengthen the socialisation process in

maintaining and revitalising inter-organisational, trust within the inter-company partnership

(Das & Teng, 1998). As a result, the extent and nature of such inter-company communication

aids in promoting a process which enables one company to examine each others credibility

and trustworthiness, through the cooperative transfer and exchange of organisational

resources.

The link between inter-organisational trust and performance, however, may be influenced by

the extent and degree of market uncertainty. Based on the assumption of a positive

association between inter-organisational trust and performance, this inherently presumes

constant or stable market conditions. The plausibility and validity of such an assumption,

however, appears invalid. This is because when companies enter into a partnership with one

another, in the form of a project-based joint venture, regulatory and institutional policies seek

to moderate and influence industrial and market structures within the environment (Luo,

2000). As such, when the market remains relatively unstable, the willingness of companies to

engage in cooperative and trusting relations with one another appears limited by the extent to

which such companies can at least ‘break-even’ financially in the short-term to ensure the

successful and timely completion of the specified project (Williamson, 1993).

Moreover, the intentions of companies to engage in trusting relations with one another appear

regulated not only by contractual binding but also from credible confidence regarding the

intentions or competence of another company through the exchange and transfer of

organisational expertise and knowledge (Lewis & Weigert, 1985). In particular, the

establishment and development of ‘united’ and ‘cohesive’ organisational partnerships appears

regulated by the extent to which both parties share common goals and are thus confident in

the realisation of positive gains and higher payoffs through the involvement of joint effort.

This embodies the acceptance of operational risk or vulnerability, which tend to be difficult to

avoid, concerning the level of uncertainty associated with the potentially significant (and/or

disappointing) outcomes of decisions or partnerships for either (or both) parties involved

(Sirkin & Pablo, 1992; Xin & Pearce, 1996).


56

Subsequently, according to Yan and Gray (1994), it appears rare that different partner

companies may share common strategic goals, particularly in light of the differences in their

industrial experience and environmental familiarity (Luo, 2000).

A common link which connects partner companies in the development and maintenance of

long-term cooperative relationships, however, is resource interdependence (Parkhe, 1993).

Namely, the stronger the level of resource interdependence between the differing partner

companies, the higher the likelihood of more opportunities and benefits, as a result of the

exchange and transfer organisational knowledge as created though reliance upon inter-parent

cooperation and trust (Ring & Van de Ven, 1994). Based on high levels of resource

interdependency, this is also likely to additionally save on coordination costs, as well as

create more opportunities for inter-organisational learning between the partner companies

(Hamel, 1991; Mohr & Spekman, 1994).

The establishment and development of project-based joint ventures between partner

companies, however, entails the acceptance and management of risk commensuration.

Specifically, risk commensuration refers to the extent to which risk, whether financial or

operational, remains substantially shared between the companies involved in the partnership.

Of particular concern, if such risk appears dominated skewed to one party, or alternatively,

one party can not spread such risk to other companies, it is probable that such a partnership

will inevitably tend to leave one partner company at a substantial disadvantage in investment,

relative to the other (Buckley & Casson, 1988). Hence, when the level of risk which is

maintained remains commensurate with each party through equity sharing and contractual

stipulations, this is likely to ensure the expressed commitment of each organisational

company towards the partnership, in thus enhancing inter-organisational trust, as well as

inter-parent cooperation and adaptation in an uncertain market environment (Johnson, 1997).

Most importantly, however, inter-organisational trust can not be sustained nor maintained

unless each organisational company remains reciprocally committed towards the partnership,

in terms of the investment of time, knowledge, resources, in accordance with the needs of

each partner company (Lewicki & Bunker, 1996). Hence, the reciprocal commitment of each

company, involved within the partnership, serves as a stabilising influence, particularly in

offsetting potential market uncertainties and inter-company conflict. As such, the

development of mutual reciprocal commitment necessitates the requirement for desirable

accommodations in inter-parent cooperation and adaptation through acting according to


57

mutual interests, rather than competitive self-interest alone, in the exchange and transfer of

organisational expertise and knowledge (Saxton, 1997).

Hence, the significance of perceived differences in the organisational and national culture of,

and between, partner companies appears to play an important role in the establishment of

inter-organisational trust and organisational commitment, in affecting project-based joint

venture performance (Fukuyama, 1995). In support, based on an analysis of 255 international

strategic alliances between partner companies in the, Chinese provinces of Jiangsu, Zhejiang,

Shanghai, and Shangdong, Luo (2002a) examined the relationship between alliance age,

‘cultural distance’ between partner companies, market uncertainty, resource interdependence,

risk commensuration, and reciprocal commitment of partner companies. More specifically,

the methodological approach which was undertaken, entailed distributing and administering

questionnaires to general managers of manufacturing joint ventures, composed of two partner

companies, within each of the four specified provinces of the PRC. Of the 255 managerial

personnel who were sampled, these comprised 89 foreign expatriates and 166 local nationals.

Foreign expatriates were comprised of managerial personnel, originating from such countries

as: The United States (n = 27), United Kingdom (n = 24), Taiwan (n = 22), Japan (n = 20),

Italy (n = 19), Germany (n = 17), Singapore (n = 17), Hong Kong (n = 16), Canada (n = 14),

France (n = 13), South Korea (n = 12), Australia (n = 9), and Others (n = 45).

In particular, Luo (2002a) examined how the relationship between inter-organisational trust

and joint venture performance was influenced by such moderator variables, which comprised:

alliance age, ‘cultural distance’ between partner companies, market uncertainty, resource

interdependence, risk commensuration, and reciprocal commitment of partner companies.

Furthermore, the circumstances under which the positive link between inter-organisational

trust and joint venture performance became stronger or weaker were investigated. Based on

the subsequent results that were gathered, it was found inter-organisational trust played a

significant role in enhancing joint venture performance. This was found, particularly where

the age of the alliance was young, the level of risk remained commensurate with both parties

involved, market certainty was apparent, inter-partner resource dependency was high, as well

as in cases, where there existed high levels of commitment to the ongoing relationship, by

each partner company. Of particular interest, ‘cultural distance’ between partner companies

did not tend to moderate the relationship between inter-organisational trust and joint venture

performance. However, ‘cultural distance’ did serve to influence the level of inter-

organisational trust between partner companies.


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2.9. Understanding Project-Based Joint Venture Performance: Strategic Fit, Inter-

Parent Cooperation, Decision Control, and Commitment to Joint Venture Within the context of the project-based joint venture between differing companies, therefore,

the significance and importance of ‘strategic fit’ cannot be underestimated. According to

Saloner, Shepard, and Podolny (2001), ‘strategic fit’ may be defined as the ability of an

organisation to appropriately ‘match’ what can be offered by other partner companies, and

thus, identify and address perceived competency gaps in the levels of organisational

knowledge, resources and associated assets required, in order to ensure the success of project

performance.

‘Strategic fit’, therefore, relates to the provision of opportunities to share, exchange, and

manage the value-added benefits of ‘knowledge’, as relevant to the strategic and business

goals of the organisational company, in order to ‘build and nurture’ a knowledge-sharing

culture (Liebowitz & Megbolugbe, 2003).

This may be through the sharing of organisational resources and, technical skills,

competencies, as well as previous lessons learned through former arrangements, in terms of

ensuring and facilitating collaborative practice as well as interdependency between differing

partner companies. Hence, the concept of ‘strategic fit’ relates to the significance and

importance of project interdependency between companies. This is in terms of the

organisational management and allocation of knowledge-based skills, competencies, and

resources, as well as in decision-making and problem-solving processes with which to ensure

mutual and sustainable competitive advantage (Engwall & Jerbrant, 2003).

In terms of ‘strategic fit’, the relational contract which is established between companies,

within a project-based joint venture, represents a legal framework which, in turn, regulates

and defines each party’s rights, duties and obligations within the specific nature of the inter-

company partner relationship (Hackett, 1993). Thus, such a relational agreement establishes

and facilitates the process of inter-company knowledge transfer, and hence, reduces the

potential for organisational uncertainty and opportunism, on the part of one or more partner

companies. Specifically, this is through limiting each company’s ability to pursue private

goals, at the expense of common benefits, through ensuring the organisational coordination

and sharing of activities, resources and management strategies.

The context and nature of such contractual arrangements between differing companies,

therefore, is particularly important in the management of associated risk and uncertainty


59

(Poppo & Zenger, 2000). Such organisational risk uncertainty may be related to present and

future environmental conditions, together with the level of risk and uncertainty associated

with whether partner companies are able to rely on inter-organisational trust in countering

potential and adverse organisational problems which may be experienced within the project-

based joint venture.

Irrespective of the specificity of contractual arrangements within project-based joint ventures,

however, inter-parent cooperation is paramount in ensuring project success and performance.

For example it is not possible for managers to be able to anticipate, predict and contractually

resolve every future contingent event that may or may not occur, in order to maintain the

continuity of the relationship between companies. Rather, inter-parent cooperation becomes a

necessary but vital complement required to adapt to and overcome organisational problems,

conflicts and contingencies (e.g., market uncertainty, product development and information

transfer) in regulating joint venture performance.

From an economic perspective, although it may be argued that companies have “an

inalienable de facto right to pursue their own interests at the expense of others” (Buckley &

Casson, 1988, p. 34), it is important for a cooperative culture to be established within project-

based joint ventures. In line with the development of a culture of inter-parent cooperation

between differing companies, there follows a social norm of reciprocity (Granovetter, 1985).

This may be in terms of the sharing of organisational knowledge and resources with which to

attain mutual competitive advantage.

Further, the nature and level of such inter-company cooperation tends to be initiated by the

expectation that an organisational company will reciprocate beneficial behaviour in order to

maintain future social exchanges with partner companies. In addition, it has been suggested

that the strength of previous inter-parent cooperation, in terms of length, quality and form

(e.g., licensing, export, joint marketing), aids in determining and influencing the quality of the

cooperative relationship, which is established between partner companies (Doz, 1996; Gray &

Yan, 1997). For example, this may be in terms of the transfer and exchange of specialised

organisational resources, skills, and knowledge, which aid in enhancing mutual competitive

advantage.

Although organisational and national culture may influence work practices and behaviour in a

project-based joint venture, organisational learning and knowledge transfer between partner

companies are thus essential in the development and establishment of sustainable competitive


60

advantage (Bessant & Francis, 1999). As such, it is important to cooperatively manage a

‘learning and unlearning processes between partner companies in the acquisition and

development of such new competencies. In turn, this may require consideration of

technological knowledge, finance, marketing, human resources and strategic positioning in

the implementation of such organisational challenges.

The transfer of new organisational knowledge is often an extended process, requiring

considerable investment in organisational learning, adaptation and management expertise by

partner companies. Most notably, the nature of interpersonal and inter-organisational

relationships are likely to have pervasive and significant influence upon the macro-economy

and micro-business conduct of project-based joint ventures between differing partner

companies within Hong Kong construction and engineering industry (Xin & Pearce, 1996).

Hence, the effectiveness and success of partner arrangements between differing partner

companies relies heavily upon such principles as inter-organisational trust, cooperation, and

teamwork (Naoum, 2003). Success depends upon all parties and workers being

collaboratively involved in the decision-making process, rather than the adoption of a ‘top-

down’ approach. Specifically, in the latter case, this would entail management alone deciding

upon the delegation of tasks and responsibilities in facilitating organisational knowledge

transfer between different partner companies in the attainment of sustainable competitive

advantage.

As previously mentioned, companies seek to develop and establish project-based joint

ventures with other partner companies for varied reasons in order to manage ‘perceived level

of risk’. According to Bing, Tiong, Fan, and Chew (1999), such ‘risk’ tends to be

multifaceted. This may comprise: (i) inheriting a partner’s financial problems; (ii)

disagreements regarding accounting standards; (iii) distrust between employees; (iv) changes

in policy between partner companies involved in the project; (v) lack of management

competence; (vi) disagreements about staff task allocation and responsibilities in the project

team; as well as (vii) organisational management disputes. Alternatively, it is feasible that

partner companies may risk being implicated in another organisation’s reported corruption

and/or illegal activity, through misguided interpretation of regulatory laws and industry-based

standards of practice, as applicable to the project-based joint venture. The project goals,

beliefs, values and subsequent behaviour of individuals and groups tend to be influenced by

the corporate governance of organisations.


61

This is consistent with the principles of institutional theory and neoclassical economics. Also

the political, social and legal norms of institutional organisations may also regulate and limit

economic activity, engagement and investment in partnership-based joint ventures with other

companies (North, 1990; Roy, 1997; Suchman, 1995). As a result, these organisations assume

some ‘perceived level of risk’ through the development and establishment of project-based

joint ventures with other partner companies. For example, this may be through links to

relevant stakeholders as well as other client groups. There may also be complexity in the

interaction of differing organisational and/or national cultures.

Forming joint venture relationships thus requires risk management skills. In particular,

contractual risk management in dispute resolution and avoidance represent core skills. For

example, management-related risk problems may be technical, legal, logistic, social,

economic, financial, and/or commercial, which in turn may affect joint venture performance.

This may be due to the lack of management skills, knowledge transfer, and inter-

organisational learning (Baloi & Price, 2003; Jannadia, Assaf, Bubshait, & Naji, 2000).

In order to manage ‘perceived level of risk’, therefore, a number of inherent motivations exist

in forming project-based joint ventures with other partner companies within the construction

and engineering industry (Tam, 1999). For example, this may be to collaboratively merge

knowledge-based resources and assets in order to satisfy the needs of relevant primary

stakeholders, such as subcontractors and customers (Matthews, 1999). Apart from the

provision of sufficient financial strength to participate in very capital-directed infrastructure

projects, another incentive may be to reduce perceived risk exposure to clients. This may in

terms of expected or unexpected cash flow, or other financial problems, such as the capacity

to pay tolls for the completion of road, bridge, or tunnel projects (Briner, Hastings, & Geddes,

1997; Cleland, 1999). In turn, such action may be influenced by the previous reputational

relationship of, and between, differing companies. Furthermore, secondary stakeholders, such

as the general public, may also exert considerable influence through protest actions, political

influence or other indirect action, which itself may critically influence project performance

and success between differing partner companies. In the management of ‘perceived level of

risk’ within project-based joint ventures, therefore, inter-parent cooperation in the

management and sharing of organisational learning, knowledge and resources is paramount in

regulating joint venture performance.

In support, based on a sample of 293 technological and capital-intensive based joint ventures

between differing companies, Luo (2002b) found a positive relationship between inter-parent


62

cooperation and joint venture performance. Namely, as inter-parent cooperation (in the

distribution of authority, managerial rules, policies, decision-making, mutual consultation)

progressively increased, there were increases in the performance of the joint venture.

Performance was assessed in terms of (i) sales level – total domestic and export sales; and (ii)

return on investment. Furthermore, Pearce (2001) suggests that the relationship between inter-

parent cooperation (assessed in terms of organisational flexibility, information exchange and

shared problem solving) and joint venture performance tends to be mediated in turn by the

nature of the interpersonal managerial relationships within the project, as related to consensus

building and decision-making.

Closely aligned to the concept of inter-parent cooperation, in regulating the nature of joint

venture performance, however, is decision control, in terms of the procedural justice inherent

in decision-making processes and practices. According to Leventhal (1980), procedural

justice focuses on how decision-making procedures are implemented in terms of how they

affect those who have a stake in, but limited control over, the outcome of the decision. In

particular, perceptions of procedural justice tend to rely upon the consistent application of

criteria, suppression of bias, use of accurate information, opportunity for error correction,

representativeness, and ethical treatment.

As a consequence, procedural justice in decision control has a substantial impact upon the

development of organisational attitudes and behaviours, particularly more so when the

outcome of the decision is unfavourable (Brockner & Wiesenfeld, 1996). The reason why

individuals may react so strongly to issues of procedural justice in regard to decision control

could relate to individuals caring about the fairness of decision-making procedures in order to

protect and secure their own long-term self-interests (Lind & Tyler, 1988). Alternatively,

individuals may tend to value fair procedures because consistency in decision-making

inherently afcompanies their relational identity and standing in their membership,

identification and commitment towards a particular group or organisation within the project-

based joint venture (Lind, 2001; Tyler & Blader, 2000). Specifically, within the context of a

project-based joint venture between differing companies, decision control may be defined as

the process by which one organisational company may seek to influence the behaviour and

performance output of another. Such influence may be exerted as a result of differences in

national background, language, cultural values, as well as management styles, which

accentuate possible conflicts of interest in the bargaining power and the ability of partner

companies to learn from one another (Inkpen & Beamish, 1997).


63

Further, there tends to be inherent tension and conflict in decision-making processes through

shared ownership and control of the arrangement between differing companies, in regulating

the nature of project-based joint venture performance. This in turn tends to be influenced by

the desire of individual organisations to achieve operational autonomy, while at the same

time, recognising the interdependent nature of their relationship with other partner companies,

in joint venture management teams. In particular, Pratt (1998) afcompanies that organisational

identification plays an important role in shaping individual decisions to cooperate.

Organisational identification refers to the extent to which individuals tend to identify with the

strategic goals and objectives of their own organisation (Kramer, 1993). Identifying with a

particular group, therefore, has important consequences. That is that individuals are likely to

exhibit a favourable bias towards members of their own ‘in-group’, by regarding them as

trustworthy, honest, and cooperative, resulting in a group-based level of trust (Dutton,

Dukerich, & Harquail, 1994).

Within the context of a project-based joint venture, such a relationship is likely to be

composed of two or more ‘cooperating’ companies. In such an arrangement, there are likely

to be distinct subgroups or departments (e.g., engineering, marketing, research and

development), of which individuals may decide to satisfy self-interests, subgroup interests, or

alternatively, the interests of the larger ‘collective’ (Wit & Kerr, 2002). In regard to the

different subgroups that may exist within an organisation, each may be governed by their own

specific internal norms, external reputations, and the nature of their previous and/or current

relationship with other subgroups within the organisation. As such, the perceived differences

and commonalities between subgroups may influence and shape how members seek to

interact and work in a collaborative manner with other subgroups within the organisation.

Deaux (1996) argues that although individuals may identify with multiple groups (e.g.,

employer, union, professional body), within and across organisational boundaries, their

loyalties are based on the strength of their relational identities. Hence, within the membership,

created between differing partner companies through a project-based joint venture, managers

and employees may identify both with their own team, and that of the project-based joint

venture as a coupled ‘organisation’. Similarly, organisational personnel may be more or less

likely to identify with another partner company, to the extent that they have an association

with that company. Commitment to the joint venture is, therefore, closely aligned with the

concept of organisational commitment. This means that while membership within the project-

based joint venture is likely to be important to the team as a whole, managerial personnel may

tend to identify more with the project-based joint venture than with either of the partner

companies. In part, this may be explained by the managerial teams’ activities and


64

responsibilities being concern only with the performance of the project-based joint venture,

thus affording managerial membership of the project relative to the individual partner

companies, as being more salient.

Alternatively, it may be argued that the fate of the management team within the project-based

joint venture tends to be more closely linked with the outcomes of the joint venture, thereby

underlying the significance of the joint venture to the management team. This is not to

suggest, however, that all management teams are likely to be highly committed toward the

joint venture. For example, it is possible that individuals may identify with a particular group

or organisation, although it may not represent a highly cohesive unit (Mael & Ashforth,

1995). Furthermore, prior affiliation or incentives built into organisational compensation

structures may induce individual managers to be more or less loyal to the project-based joint

venture and individual partner companies (Pearce, 1997).

In general, management team commitment to the joint venture tends to be greater, than

commitment to the individual partner companies (Inkpen & Beamish, 1997). Johnson,

Korsgaard, and Sapienza (2002) found evidence, based on a sample of 54 manufacturing

international joint ventures (mainly between Japanese-U.S. (60%), European-U.S. (11%), and

Canadian-U.S. (7%) companies) to positively afcompany the position of management

identifying more strongly with the project-based joint venture than individual partner

companies. Furthermore, it was also found that managerial commitment to the joint venture

tended to be positively and significantly associated with control over the decision-making

process. There was, however, limited support for the effects of decision control of managers

in reconciling discrepancies in commitment toward the joint venture and the partner

companies. There was also no significant association between decision control of managers

and their commitment towards individual partner companies.

The effect of organisational identification on inter-parent cooperation, however, depends to a

large extent upon the context in which decisions to cooperate occur, in terms of their

underlying distinct and incompatible interests. For example, based on a sample of 177

graduate management students, Polzer (2004) examined the effects of organisational

identification on individual decisions to cooperate. In this research, individuals were

randomly assigned to ‘three-person’ subgroups, which in turn were paired with another

‘three-person’ subgroup to form a ‘six-person’ collective. Individuals were then assigned with

addressing and resolving written social dilemmas, where choice was restricted to favouring

either self-interest, subgroup-interest, or collective-interest. The findings revealed that higher

‘organisational’ identification resulted in lower cooperation with the ‘collective’ (and higher


65

cooperation with the ‘subgroup’) when the opposing ‘organisation’ possessed an

individualistic culture and reputation. In terms of the relevance of such findings towards

project-based joint ventures, therefore, cultural differences tend to affect cooperation.

Namely, when faced with dilemmatic decisions, people from individualistic cultures are more

likely to defect towards identifying more with the goals and objectives of their own

organisation, rather than the ‘collective’, relative to those people from collectivistic cultures

(Cox, Lobel, & McLeod, 1991).

Developing and maintaining a ‘cooperative’ culture that seeks to facilitate and promote

organisational learning and knowledge management transfer within and between differing

partner companies is, therefore, critical to the fulfilment of mutually agreed upon objectives.

This is important as creating, disseminating, evolving, and applying knowledge, towards the

attainment of sustainable competitive advantage, represents an interactive process, as

supported by resources, business strategy, cultural values, and work processes (Berdrow &

Lane, 2003). As such, knowledge management tends not to be a simplistic process. Rather,

knowledge management represents a collective endeavour, which is open and governed by

social and political processes. In turn, this can result in conflict due to differing organisational

subcultures, ideologies, norms and worldviews, in regard to knowledge transfer between

partner companies within the project-based joint venture.

An understanding of the purpose, significance, and inter-relatedness of organisational

knowledge between partner companies, therefore, aids in developing and managing future

long-term strategic goals. This is so, particularly, in anticipating areas of potential conflict,

rather than merely attempting to ‘bridge’ the knowledge-based deficiencies, limitations, and

complementary resources of partner companies in the short-term (Tidd & Izumimoto, 2002).

Thus, limited awareness of the organisational and national cultural attributes, relevant to the

assumptions, values, and norms of work practices and behaviours of the differing companies,

may inevitably lead to failed misunderstandings in the management and transfer of

knowledge-based skills within the project-based joint venture (Hoecklin, 1995).

2.10. Methodological Limitations of the Relevant Research Literature: Rationale of the

Present Research in Understanding Satisfaction with Project-Based Joint Venture

Performance From a critique of the relevant research literature, it is apparent that companies need to

develop collaborative partnerships with one another, through project-based joint ventures.

This is in order to effect and sustain competitive advantage within the marketplace, through


66

the value-creation, development, and transfer of organisational skills and knowledge

(Isabella, 2002). According to Barney (1991), however, ‘sustainable competitive advantage’

is quite distinct from that of ‘competitive advantage’. Sustainable competitive advantage is

achieved only through the implementation of value-creating strategies (i.e., organisational

assets, capabilities, processes, information and knowledge) that are not being simultaneously

implemented by other current or potential companies. Also, there should be no companies

capable of duplicating the benefits of such implemented organisational strategies.

In order to attain sustainable competitive advantage through project-based joint ventures,

however, partner companies need to learn how to cooperate and work together. This is

achieved through the development of a shared sense of inter-organisational solidarity, within

the long-term, rather than merely favouring competitive self-interest alone. This is

particularly important, given that companies often tend to differ in their extent and type of

experience with inter-company partnerships, organisational and national cultures, as well as

through management policies, procedures and philosophies (Cullen, Johnson, & Sakano,

2000).

Consistent with the notion of ‘strategic fit’ within project-based joint ventures, therefore,

inter-company partnerships need to be mutually compatible in order to ensure the

establishment and maintenance of inter-organisational trust and organisational commitment

(Parkhe, 1998). Partner companies thus need to invest considerable attention and energy

towards addressing and managing the complexity and nature of inter-company relations, in

order to ensure the success of project-based joint venture performance. As such, this

recognises the interdependent nature of the relationship between partner companies, in terms

of the transfer and equitable sharing of organisational learning and competencies, expertise,

assets, and resources.

Hence, there needs to be flexibility in the extent to which differing companies are able to

work creatively or in an innovative manner with one another, in line with changing

circumstances and unforeseen problems which may occur within the project-based joint

venture. An important aspect which defines how well companies learn to innovate and

compete with one another within the marketplace, however, is through knowledge

management practices in the transfer and sharing of organisational and knowledge-based

skills and resources (Lei & Slocum, 2002).


67

The effectiveness and efficiency of collaborative practice within inter-company partnerships,

is paramount in facilitating sustained and mutual competitive advantage in the Hong Kong

construction and engineering industry. This is because Hong Kong, as a major commercial

centre, represents one of the fastest growing economic regions within Southeast Asia—the

construction and engineering industry contributes significantly towards Hong Kong’s annual

GDP (U.S. Department of State, Bureau of East Asian and Pacific Affairs, 2003).

Tam and Harris (1996) argues that the Hong Kong construction and engineering industry

represents an international market where contractors from all over the world are able to access

and leave with few perceived barriers. The competitive status of this industry, however, is

keen. With rising labour costs, and stringent environmental and safety control, such factors

tend to negatively impact upon both the quality of work undertaken and project construction

completion times. Hence, in light of strained organisational resources of partner companies,

this has tended to lower the performance of this industry. This appears to be partly due to the

inexperience of organisational staff in the management of effective inter-company

partnerships, resulting in subsequent lack of buildability (Tam, 2000).

In terms of the measurement of joint venture outcome, researchers have tended to rely upon

two main types of methodology. One approach has been to measure the survival of joint

ventures through liquidation or acquisition. In general, however, financial measures of joint

venture performance tend to be largely unavailable, as partner companies rarely report

financial information separate from their consolidated financial statements. In addition, such

financial measures cannot adequately account for non-financial goals and objectives pursued

by joint venture partner companies that are critically important to joint venture performance

(Anderson, 1990). Therefore, in recognition of the inadequacy of sole reliance upon financial

measures, an alternative approach has been to assess the perceived level of satisfaction of one

or more partner companies. Regrettably, however, limited attention has been paid towards

addressing inter-relationships between different measures of joint venture performance

(Hatfield, Pearce, Sleeth, & Pitts, 1998).

Of notable exception, within the relevant literature, a positive and significant association has

been found between satisfaction of the joint venture and joint venture survival (Geringer &

Herbert, 1989). This is not to suggest, however, that measures of satisfaction of the joint

venture nor survival represent appropriate indices of ‘success’. Although objective measures

such as return on investment, growth, market or shareholder value, could be readily used to


68

ascertain the degree and extent of joint venture ‘success’ between differing partner

companies, there are obvious pitfalls in reliance upon such indices of joint venture ‘success’.

Specifically, such measures of ‘success’ may be biased and incomplete, in that such aspects

including tax consideration transfer pricing practices, or the ‘competitive secrecy’ of ‘inside’

financial and marketing data, may otherwise render such data as highly questionable (Kogut,

1988). So measuring the ‘subjective’ appreciation of the extent of satisfaction (or

dissatisfaction) with joint venture performance appears to represent a more tenable and

appropriate characteristic of joint venture performance, regardless of whether the joint

venture is financially or commercially ‘successful’ for the involved partner companies. An

understanding of joint venture performance, however, relies upon the nature of the inter-

relationships between a number of important variables. Primarily, change in terms of the

exchange and transfer of organisational knowledge, competence and expertise is essential

towards growth, sustainability and competitiveness, particularly within the Hong Kong

construction and engineering industry (Bessant & Francis, 1999). For example organisational

research demonstrates that the simple generation of ideas, which aid in sustainable

competitiveness, is not the same as making effective use of such available technology

(Dodgson & Bessant, 1996). Rather, such innovative practice necessitates the need for

organisational learning, specifically through individuals interacting and sharing such

knowledge. In turn, this can become part of the organisational culture, through the transfer

and exchange of shared concepts, values, and beliefs among workers, within and between the

differing partner companies. Such learning, however, is not automatic, rather, organisational

learning within and between differing partner companies tends to be influenced by a myriad

of different factors. Consequently, such factors may directly or indirectly impact upon, shape,

and influence the competitiveness of companies, engaged within such relationships. As

already discussed, such factors may comprise: national and organisational culture, the

perceived extent and level of ‘cultural divergence’ between partner companies, organisational

commitment, inter-organisational trust, strategic fit, inter-parent cooperation, decision control,

as well as managerial-related commitment towards the joint venture.

Recently, the significance of ‘value management’ has been considered as integral toward

facilitating the effectiveness and efficiency of project performance within the Hong Kong

construction and engineering industry. According to Fong and Shen (2000), value

management may be defined as “an organised function-oriented team approach directed at

analysing the functions of a product, system, or supply, for the purpose of enhancing its value


69

by identifying and eliminating unnecessary costs and achieving the required performance at

the lowest life-cycle project cost” (p. 318).

Although the concept of value management was originally used by technicians in reference to

cost reduction in engineering and manufacturing processes, such a principle may also be

contingently applied to organisational culture, in terms of management practices and activities

and company policy, in addressing solutions to problems experienced by construction and

engineering professionals (Dawson, 1996). Of particular concern, is that few managerial

personnel, employed within the Hong Kong construction and engineering industry, appear to

be aware nor adequately understand the significance nor applicability of how ‘value

management’ practices may otherwise serve to enhance collaborative-based practice (Fong &

Shen, 2000). Rather, within the Hong Kong construction and engineering industry, it appears

that as construction and engineering costs tend to constitute only a small portion of the total

cost of development projects, many developers within Hong Kong tend to remain relatively

‘short-sighted’ (Dawson, 1996).

Principally, short-sightedness is evident through the use of ‘traditional’ procurement methods

of construction, through developers’ exclusive focus upon such outcomes as profitability,

rather than through seeking to enhance value improvement. Hence, such short-sightedness

fails to take account of the significance of the inter-relationships between such other variables

as: national and organisational culture, the perceived extent and level of ‘cultural divergence’

between partner companies, organisational commitment, inter-organisational trust, strategic

fit, inter-parent cooperation, decision control, and managerial-related commitment towards

the joint venture. As a result, there exists limited data of the nature of the inter-relationships

between such aforementioned variables with satisfaction with joint venture performance.

As construction and engineering problems tend to remain extremely complex and ill-defined,

it is likely that without proper methodologies to follow, consultants will find it very difficult

to satisfy clients’ requirements at the lowest life-cycle cost. Furthermore, as the traditional

procurement system within the Hong Kong construction and engineering industry is

characterised by clear separation of the design and construction phases, it remains difficult for

contractors to input their expertise and technical knowledge into the design process. In the

context of ‘value management’, this is vital, particularly in addressing concerns regarding the

lack of buildability and long completion periods for project-based joint ventures that

otherwise seek to satisfy clients’ requirements with a relatively low life-cycle costs (Walker,

1989).


70

Hence, to date, it appears that many studies have not taken into account the significance of

both national and organisational culture upon the functioning of project-based joint ventures

between partner companies within the Hong Kong construction and engineering industry

(Hempel, 1998). For example, significant problems may arise from perceived national and

organisational cultural differences, stemming from companies not adequately understanding

the market uncertainty, commensurate risk, and the prevailing environmental pressures facing

their partners, in the exchange and transfer of organisational competencies and knowledge

(Bruton & Ahlstrom, 2003). Hence, it is important that relevant information be gathered in

order to understand, and facilitate collaborative practice in the development of sustainable

competitive advantage, between partner companies within the Hong Kong construction and

engineering industry. In light of the perceived and apparent limitations of the relevant

research literature, therefore, the rationale of the present research seeks to address such

perceived deficiencies and gaps in present knowledge.

2.11. Chapter Summary A critical review of the relevant research literature was presented in this chapter. It related to

understanding the nature and dynamics of cross-cultural knowledge–based management

practices. It also included a review of organisational learning, and the strategic planning and

management in the creation of sustainable competitive advantage within the Hong Kong

construction and engineering industry.

Also the role of ‘knowledge management’ in facilitating organisational learning and

knowledge transfer between partner companies was critically appraised. A socio-historical

background of varying cultural determinants in influencing joint venture performance, within

the Hong Kong construction and engineering industry, was then reviewed.

The research literature review presented in this chapter formed the basis for developing

empirical instruments, to test hypotheses and explore and answer the research questions

developed in both Study One and Study Two. In Chapter Four, Study One for example, the

questions sought to explore and understand the nature of and characteristics of project based

joint ventures in influencing the managerial design of organisational structures amongst

senior executives (See the questionnaire in Appendix B).

In Chapter Five, Study Two, the questionnaire further developed by insights and

developments gained through Study One of this thesis, provided a detailed examination of


71

instrument development procedures used to develop and frame the empirical instruments

covering reliability and validity of the Strategic Alliance Contracting Inventory (SACI) in this

research.(SACI questionnaire is included as Appendix D)

Accordingly, the literature review presented in this chapter provided the basis for framing

questions used in both Study One and Study Two and the rationale linking the literature

review to both Study One and Study Two.


72

In Table 2.2, examples demonstrate clear links between this literature review chapter, Study

One in Chapter Four and Study Two in Chapter Five.

Table 2.2 – Linkages between Literature Review and Studies One and Two

Study One Study TwoQuestionnaire References SACI References

2.1 Significance of Strategic Alliance * Competitive Advantage Issues A1-2, B6, B9, B12, B13, D10, Q4, Q12, Q24, Q67-Q69 attainment of Sustainable E1-5, E15-17, E25, H5 Competitive Advantage

* Strategic Alliance/Scope Issues B10, E6-E8, E10-E11, F3, F4, Q3, Q9, Q10, Q21, Q22, Q23, F6, I2, M5 Q25, Q28, Q30, Q32, Q36, Q41,

Q42, Q47, Q49, Q50, Q52, Q592.2 Organisational and Cultural * Cultural Divergence Issues L1-L2 Q2, Q8, Q13, Q17, Q23,Q27,Q36

Knowledge and Competence in Q39, Q40, Q41, Q42, Q49, Q52, Hong Kong project based JV's Q56,Q59,Q60,Q63,Q64,Q65,Q66

* Organisational Issues G6, G7, K1-K7, L2-L4, L6 Q45, Q48, Q55, Q56, Q75-Q89

* Knowledge Management Issues H4, H8, H9, H10, H11 Q13, Q15, Q19, Q25, Q40, Q61, Q64 Q67, Q69

* Competency Issues A3, B17, D1, D2, D4-D9, D11-D15 Q9, Q13, Q14, Q20, Q24, Q37 E18, E29-E31, H5, L4, M1, M7

2.3 Implications of Knowledge * Competitive Advantage Issues A1-2, B6, B9, B12, B13, D10, Q4, Q12, Q24, Q67-Q69 Management Economy in E1-5, E15-17, E25, H5 Creation of Sustainable in Hong Kong Construction and * Organisational Issues G6, G7, K1-K7, L2-L4, L6 Q45, Q48, Q55, Q56, Q75-Q89 Engineering Industry

2.4 Impact and Influence of * Organisational Issues G6, G7, K1-K7, L2-L4, L6 Q45, Q48, Q55, Q56, Q75-Q89 Organisational and National Culture upon Operational * National Cultural Issues L1-L2 Q2, Q8, Q13, Q17, Q23,Q27,Q36

Functioning of JV's Q39, Q40, Q41, Q42, Q49, Q52, Q56, Q59, Q60, Q63, Q64, Q65, Q66

2.5 Political and Cultural Influences * Cultural Influences Issues L1-L2 Q2, Q8, Q13, Q17, Q23, Q27, Q36 upon Historical Development Q39, Q40, Q41, Q42, Q49, Q52, of HK's Construction and Q56, Q59, Q60, Q63, Q64, Q65, Q66 Engineering Industry

* Historical Issues I3, I4, Q4, Q9, Q11, Q502.6 Contract Procurement and Strategic * Strategic Alliance/Scope Issues B10, E6-E8, E10-E11, F3, F4, Q3, Q9, Q10, Q21, Q22, Q23,

positioning of JV's and implications F6, I2, M5 Q25, Q28, Q30, Q32, Q36, Q41, and understanding Organisational Q42, Q47, Q49, Q50, Q52, Q59 Development and Managerial practice

* Organisational Issues G6, G7, K1-K7, L2-L4, L6 Q45, Q48, Q55, Q56, Q75-Q89

* Managerial Practice Issues L5, L8, M3, M5 Q1, Q2, Q3, Q11, Q12, Q16, Q18, Q21 Q26, Q31, Q43

2.7 JV Performance with Organisational * Organisational Issues G6, G7, K1-K7, L2-L4, L6 Q45, Q48, Q55, Q56, Q75-Q89 Culture and Inter Organisational Commitment * Cultural Influences Issues L1-L2 Q2, Q8, Q13, Q17, Q23, Q27,Q36

Q39, Q40, Q41, Q42, Q49, Q52, Q56, Q59, Q60, Q63, Q64, Q65, Q66

* Commitment Issues E19, E20, F1, F2, F5, H1, H2 Q58, Q70, Q71, Q72, Q73, Q74, Q75 Q87

2.8 JV Performance with Organisational * Organisational Issues G6, G7, K1-K7, L2-L4, L6 Q45, Q48, Q55, Q56, Q75-Q89 Culture and Inter Organisational Trust * Cultural Influences Issues L1-L2 Q2, Q8, Q13, Q17, Q23,Q27,Q36

Q39, Q40, Q41, Q42, Q49, Q52, Q56, Q59, Q60, Q63, Q64, Q65, Q66

* Trust Issues E14, F6, G7, G8 Q6, Q11, Q14, Q16, Q20, Q38, Q53, Q61, Q65

2.9 JV Performance with Strategic Fit, * Strategic Fit Issues B10, E6-E8, E10-E11, F3, F4, Q3, Q9, Q10, Q21, Q22, Q23, Inter-Parent Co-operation, Decision, F6, I2, M5 Q25, Q28, Q30, Q32, Q36, Q41, Control and Commitment Q42, Q47, Q49, Q50, Q52, Q59

* Inter-Parent Company Co-Operation E21-E23, E26-E28, I5, I6, Q18, Q19, Q26, Q31, Q33, Q37 Issues Q44, Q45, Q48, Q62, Q63

* Decision/Control Issues B18, B19, H3 Q5, Q17, Q46, Q47, Q54, Q62

* Commitment Issues E19, E20, F1, F2, F5, H1, H2 Q58, Q70, Q71, Q72, Q73, Q74, Q75 Q87

Literature Content Common Issues/Links


73

This context helps to explain the purpose of establishing strategic alliances between foreign

and local-based contracting corporations in Hong Kong. Moreover, a detailed understanding

of factors, which influence and/or hinder the development of project-based joint venture

partnerships, within the Hong Kong construction and engineering industry, were also

explored. This literature review identified that there have been a limited number of studies of

the way that cross-cultural International Joint Venture’s (IJV’s) actually operate in the Hong

Kong infrastructure construction sector.

This was found to be particularly so where the subject of enquiry is to investigate how cross-

cultural understanding impacts upon organisational learning that may lead to competitive

advantage. Identification of this knowledge gap guilds the course of this research. Finally, in

light of the apparent methodological limitations of the relevant research literature, the

rationale of the present research was then justified.

CHAPTER THREE

METHODOLOGY AND RESEARCH DESIGN

The purpose of this chapter is to provide a critical review of differing types of research

methodology and design and to both explain and justify the chosen research approach for the

study. Specifically, the advantages and disadvantages of the differing types of qualitative and

quantitative methodological design are discussed and presented to indicate why the chosen

research approach was appropriate.

Detailed discussion of the research approaches and treatment of data for analysis

including justification for tools chosen, are provided separately within Studies One and

Two, to better manage the flow and justification within each Study.

3.1 Understanding the Purpose and Significance of Methodological Research Design.

Sekaran (1992) describes methodological research design as representing a planned and

structured process of investigation of an identified research question that is logically conceived,

developed, and answered as reliably, accurately, and objectively as possible. This is

accomplished through gathering and analysing relevant and purposeful data. The purpose of

research is to add significant, substantive and meaningful information to what is known about

particular phenomena by identifying gaps or limitations about a particular concern in

contemporary knowledge that necessitates further explanation.

The methodological research design needs to be reliable, valid and rigorous. It should allow

results to be replicated with some satisfactory degree of precision and confidence within other

settings (Sekaran, 1992). Thus, the research problem must be defined in terms of

examinable research questions and hypotheses (Punch, 2000).

Generally, research questions are relatively broad and hence do not identify what are likely to

be the key investigative variables of the research problem. Hypotheses, however, are more

specific in identifying and defining independent and dependent variables of interest and

significance to the researcher. Such hypotheses may provide tenable evidence with which to

support or dispute existing evidence which may be the subject of contentious debate within the

relevant research literature (Walker, 1997).

Chapter Three: Methodology and Research Design

75

Two main types of research design can be deployed when investigating a particular type of

research problem, qualitative and quantitative. Although qualitative and quantitative-based

approaches produce useful data through which valid conclusions may be drawn, they represent

two differing approaches; each with inherent advantages and disadvantages. One approach may

be considered more appropriate in terms of data collection and analysis procedures to be

undertaken than the other, depending on the nature of the identified research problems and

hypotheses (Stangor, 1998).

3.2. Research Purpose and Approach: Implications for Research Method Reliability and

Validity.

Research may be exploratory, descriptive, predictive or explanatory in nature, seeking to

understand and/or clarify a particular concern, or alternatively, confirm or refute a particular

research problem (Singleton, Straits & Straits, 1993). Hence, the nature and purpose of research

will influence the research design in terms of the location of the study, its duration, sampling

design, data collection methods, and analytical procedures. Figure 3.1 provides a schematic

representation of a research design.

Exploratory-based research (using a qualitative research design) relies upon the

researcher assuming the role of the ‘naïve enquirer’ in possessing only limited and

salient knowledge about a particular topic (Patton, 1990). Hence, exploratory-based

research relies upon inductive-based scientific reasoning where an in-depth analysis of

multiple sources of relevant data may be undertaken to examine and discover

undertaken to examine and discover patterns that reflect the relevant literature

(Eisenhardt, 1989). Such research findings can then guide more extensive research

through identifying suitable and appropriate research hypotheses.

Qualitative research design uses a wide range of data gathering strategies, including

structured, semi-structured and unstructured interviews (Punch, 2000; Stangor, 1998).

The choice of structured, semi-structured, or unstructured interviews depends upon

whether questions and expected response categories are pre-planned, structured and

standardised across differing respondents and situations. A balanced choice helps

researchers limit potential bias while maintaining question flexibility and variation.


76

DETAILS OF STUDY MEASUREMENT DATA ANALYSIS

Purpose of the Study Types of Investigation Extent of Researcher

Interference

Study Setting Measurement and

Measures

Exploration

Description

Hypothesis

Establishing: Causal

relationships

Correlations

Group Differences

Ranks

Minimal: Studying

events as they normally

occur

Manipulation and/or

control and/or

stimulation

Contrived

Noncontrived

Operational Definition

Items (Measure)

Scaling

Categorising

Coding

1. Feel for data

Problem Statement

2. Goodness of data

Unit of Analysis

(population to be

studied)

Sampling Design Time Horizon Data Collection Method

Individuals

Dyads

Groups

Organisations

Machines etc

Probability/

Nonprobability

Sample Size (n)

One-shot (cross-

sectional)

Longitudinal

Observation

Interview

Questionnaire

Physical Measurement

3. Hypothesis Testing

Figure 3.1: Representative-Based Model of Research Design (Source: Sekaran, 1992, p. 93).


77

Qualitative research design might entail using case studies, ethnography, or grounded

theory approaches, dependent upon the nature and type of research problem being

investigated (Roberts, 2002; Yin, 1994). Case study research generates and develops

hypotheses and new theories through triangulation of multiple data collection methods

such as interviews, observations, or using documentary evidence (Eisenhradt, 1989).

Ethnography uses the researcher as an observing participant who interprets meaning

from observations. Grounded theory approaches are guided by an iterative data

collection procedure, directed by emergent relationships identified through a cycle of

data gathering and analysis (Punch, 2000). Case study, ethnography, and grounded

theory approaches, therefore, provide a complete and contextual understanding of a

particular phenomenon. The purpose of qualitative-based research is therefore, to

develop an holistic and broad understanding of a particular topic through gathering

information-rich and diverse data (Patton, 1990). Hence, qualitative research makes

restricted use of standardized research instruments. This approach may be considered

optimal in gathering data on everyday life experiences of the participants, particularly

where there exists only limited information. However, results gained through the sole

use of a qualitative methodological design may not be readily generalisable beyond that

of the target sample under study because they are particularised to the target sample.

Quantitative-based research may also be used to predict and/or explain the nature and

significance and inter-relationships of key identified variables. The quantitative

approach has been termed as the ‘traditional’, ‘positivist’, ‘experimental’, or ‘empirical’

paradigm (Singleton, Straits & Straits, 1993). Such research is hypothetical-deductive.

and begins with the conceptualisation of a defined theoretical framework through which

specific hypotheses are formulated and results are then drawn of the existent

relationships among specified independent and dependent variables (Sekaran, 1992).

Conversely, the inductive method (or qualitative approach, otherwise termed as

‘constructivist’, ‘naturalistic’ or ‘phenomenological’) begins with the data gathered,

through which hypotheses are then formulated and theories developed. Such qualitative

research tends to be based on few cases. However, data, which is gained from

quantitative research, is based upon the statistical aggregation of information gained

through the purposeful sampling of a larger and more representative number of


78

respondents. For example, this may be through the administration of surveys or

appropriate instrumentation (e.g., questionnaires, Likert-type rating scales) that is

composed of particular questions relevant to the research problem being investigated.

However, the nature of complex management research questions tends to more

frequently require exploratory, descriptive, predictive and explanatory treatments to

obtain multiple and varied perspectives concerning particular phenomena. Furthermore,

such research may or may not be retrospectively based in requesting participants to

recall particular relevant experiences.

Based upon a critique of qualitative and quantitative-based research, the methodological

design of the research study presented in this dissertation incorporates elements of each

type of methodology in two separate yet inter-related studies. The aim is to develop a

detailed and contextual understanding of how organisational learning and knowledge-

based management practices provide construction companies undertaking infrastructure

projects in Hong Kong with a competitive advantage. Competitive advantage in this

research context may cover all or some of the following areas, performance quality,

price, technologies used or available, engineering skills, financial strength, site safety,

speed of delivery, personable manner of employees, geographical location and political

influence. These types of competitive advantages have been lumped together for the

purposes of this research.

In Study One, in Chapter Four, exploratory interviews were used to examine the

organisational learning and knowledge-based management practices of project-based

joint ventures across differing organisations (research questions 1-5). In Study Two, in

Chapter Five, a reliable and valid research instrument was developed to investigate the

nature and significance of inter-relationships between key and pertinent variables

concerning joint venture performance, were investigated (research questions 6 and 7).

Of concern, however, are such issues as methodological reliability and validity.

Reliability refers to the likelihood that the same measurement procedure will yield the

same description of the phenomena if that measurement is repeated (Kaplan &

Saccuzzo, 1997). Validity indicates the extent to which research captures the

phenomena for which it claims to measure (Sangor, 1998). Two types of validity exist:


79

internal and external. Internal validity refers to whether the study adequately describes

the phenomenon it sets out to examine, in the ability to draw inferences from

observations. External validity refers to the extent to which the subsequent findings of

the study may be generalised (Singleton, Straits & Straits, 1993).

Hence, reliability and validity of Study One and Study Two procedures were adopted in

order to minimise measurement error, bias, and enhance the rigour of the research

findings and their interpretability. First, as qualitative data poses a threat to internal and

external validity assessment, in-depth interviews were used in Study One to gain an

understanding of participants’ industry experience of project-based joint ventures. A

standardised interview schedule was used for these interviews. Results gained through

this exploratory research design sought to minimise the possibility of only providing

purely descriptive measurements through using specific Likert-type indicators with

which to adequately quantify the qualitative-based data gathered in Study One in a

standard, clear and unambiguous way. Respondents were also provided with the

opportunity to more fully explain their answer and check with the researcher that their

answers reflected their intended meaning.

Interview-based research does have a potential reliability problem of the researcher

influencing in-depth field research measurements. However, such research does have

high internal validity because it enables the researcher to more fully understand the

situation context from the involved actors’ perspective. Collection of qualitative data,

gathered through in-depth interviews provides rich descriptions that enabled a deeper

understanding of the situation and the rationale underlying the operational nature and

functioning of project-based joint ventures. Interviews were taped and transcribed so

that any inconsistency could be verified. Study One respondents comprised a highly

representative sample of organisations from different cultural backgrounds engaged in

project-based joint ventures in the Hong Kong construction and engineering industry.

Based on the findings of Study One, multiple sources of quantitative-based evidence

were then used to develop and construct a reliable and valid research instrument for

Study Two. This was achieved through triangulation in data collection and analysis in

Study One, together with a critical review of the relevant research literature.


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However, it should be noted that the scope of Studies One and Two remained

necessarily limited in terms of understanding the nature and significance of

collaborative-based practice between foreign and local contractors engaged in project-

based joint venture infrastructure projects within the Hong Kong

construction and engineering industry. Moreover, there is likely to be measurement bias

due to the nature of the sample that was accessed in terms of those who elected to

participate within this research.


In this chapter, a critical review of the significance, advantages and disadvantages of

differing research design methodology, dependent upon the proposed purpose of

research, were critically appraised and discussed. Further, in light of such justification,

a brief descriptive summary of the methodological design of the present research for

Study One in Chapter Four and Study Two in Chapter Five was given.

Detailed discussion of the research approaches and treatment of data for analysis

including justification for tools chosen are provided within Study One and Two

chapters, to better manage the argument’s flow and justification.

CHAPTER FOUR

STUDY ONE: INTER-ORGANISATIONAL CULTURE,

COMPETITIVE ADVANTAGE,

AND PROJECT-BASED JOINT VENTURE BEHAVIOUR

In the previous chapter, the rationale for the type of qualitative and quantitative-based

methodology utilised in this research was discussed and examined. The present chapter

describes the purpose, objectives, methodology, results, and discussion of Study One. Based on

the results and key findings of Study One, their implications for Study Two are given.

4.1 Purpose of Study

The purpose of Study One was to investigate and explore senior executives’ perspective of the

inter-organisational culture of project-based joint ventures between partner companies within

the Hong Kong construction and engineering industry. In particular, this study concentrated

upon examining senior executives’ understanding of what inter-organisational cultural-related

attributes and characteristics were considered to be important in developing, establishing, and

maintaining project-based joint ventures in promoting knowledge-based competitive advantage

with other companies within the Hong Kong construction and engineering industry. It was

anticipated that the perceived motivations of senior executive personnel represented significant

influences in shaping the managerial design of inter-organisational structures and knowledge-

management cultures in the achievement of sustainable competitive advantage within this

industry.

The methodology, results, and conclusions of this research were presented at an internationally-

refereed Conference [ i.e., Walker, D.H.T., & Johannes, D.S. (2001). Organizational learning

intentions and joint ventures in Hong Kong infrastructure projects: A pilot study. ARCOM

Seventeenth Annual Conference; Salford, UK; See Appendix H]. Two further refereed papers

also detailed in Appendix H, were published upon the receipt of constructive feedback,

comments, and criticism from conference participants and others who read the manuscripts.

These were published in the subsequent conference proceedings:

Chapter Four: Study One

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• Walker, D.H.T., & Johannes, D.S. (2003). Construction industry joint venture

behaviour in Hong Kong – Designed for collaborative results? International Journal

of Project Management, 21 (1), 39 – 49.

• Walker, D., & Johannes, D.S. (2003). Preparing for organisational learning by HK

infrastructure project joint venture organisations. The Learning Organisation, 10 (2),

106 – 117.

4.2. Method

4.2.1. Qualitative Methodology in Understanding the Inter-Organisational Culture and

Competitive Advantage of Project-Based Joint Ventures

In order to understand the relationship between inter-organisational culture and competitive

advantage within project-based joint ventures in the Hong Kong construction and engineering

industry, qualitative methodology represents one type of approach in which wide-ranging and

rich data may be gathered about a particular topic. For example, such data may be gathered in

regard to the subjective experiences, self-perceptions and opinions of individuals, which are in

turn informed by multiple domains of understanding (e.g., social, cultural, economic, political,

ethical) (Fossey, Harvey, McDermott, & Davidson, 2002). Gathering qualitative information is

therefore essential in order to systematically inform the course and direction of future

quantitative-based research efforts with which to examine the validity of formulated hypotheses.

More specifically, interview-based research has been shown to be an effective tool in learning

how and why a phenomenon exists.

In-depth interviews, whether structured or unstructured, represent one type of qualitative-based

approach that may be undertaken through which an understanding of the experiences and

perspectives of respondents may be gained. It is important, however, that the ‘unit’ of analysis

be defined. The ‘unit’ of analysis for this exploratory study is project-based joint ventures

within the construction and engineering industry of Hong Kong. Furthermore, senior executives

with extensive knowledge of the inter-organisational culture and relations within these project-

based joint ventures were used in order to gain highly ‘reliable’ context-dependent data.

Yin (1994) proposed that exploratory research enables investigators to refine their data

collection plans, and thus may be used to develop more relevant lines of questions through

exemplary analysis of a presenting situation which previous research has not had the

opportunity to examine in detail. Based on in-depth interviews which were conducted with 90


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corporate executives of international companies, Welch, Marschan-Piekkari, Penttinen, and

Tahvanainen (2002) suggest that data from such personnel aid in improving our understanding

of international business settings, particularly where access to such personnel is considered

difficult. Hertz and Imber (1993, p3) state that this is because, by their very nature in terms of

their professional status and standing, such executive personnel “establish barriers that set their

members apart from the rest of society”. Hence, bias in sampling represents an unavoidable

methodological concern of qualitative research in which in-depth interviews are conducted with

senior executives (Macdonald & Hellgren, 1998). There is, however, consensus that such

personnel, rather than less senior staff, tend to be more open and frank when responding to

demanding and probing questions, particularly when asked to assess and evaluate indicators of

organisational and operational performance (Ostrander, 1993). However, the findings of such

research gathered from senior executives inevitably tend to remain subject to both interference

and censorship from such personnel in that “the theoretical categories driving research are

largely irrelevant to their interests” (Hirsch, 1995, p. 77).

Potential methodological concerns exist regarding the reliability and validity of qualitative

research with executive personnel. However, the potential for information-rich data cannot be

understated nor underestimated in furthering our level of understanding of the inter-

organisational culture of project-based joint ventures within the Hong Kong construction and

engineering industry. This is particularly more so given the principal investigator’s personal and

professional access to such key executive personnel representative of the status and networked

culture of inter-organisational and operational relationships of project-based joint ventures

within this industry. Furthermore, significant examples of such research methodology have

previously been used in order to investigate the organisational and operational culture of

project-based joint ventures (e.g., Brock & Barry, 2003; Buckley, Glaister, & Husan, 2002).

Hence, such research seeks to support the scientific rigour of the following methodological

approach, as undertaken in this present research.

The methodological approach of this exploratory research will now be described and detailed,

which was undertaken with senior executive personnel who were involved in the governance of

project-based joint ventures within the Hong Kong construction and engineering industry.

4.2.2. Procedure

In depth face-to-face interviews were conducted with senior executive personnel of their

respective construction and engineering companies in Hong Kong. Initially, the researcher

telephoned such individuals to explain the purpose and benefits of the present research. Upon


84

the receipt of assured consent and confidentiality, the researcher telephoned all individuals to

arrange a mutually convenient time to conduct the interviews. Of those respondents who were

interviewed, each possessed extensive knowledge and experience of the organisational culture

and operational functioning of project-based joint ventures within the Hong Kong construction

and engineering industry. Moreover, these senior executives understood the importance and

significance of cultural-related technology and knowledge transfer between ‘local’ and ‘foreign’

contractors in project-based joint ventures in achieving sustainable knowledge-based

competitive advantage within this industry.

For each interview, individual participants were greeted by the researcher, during which the

purpose and nature of the session were explained. A standard interview schedule was used to

guide each of the interview sessions (refer to Appendix B). In response to the questions which

were posed by the researcher, all participants were encouraged to present their own

individualised points of view in discussing their ideas freely and openly. On obtaining several

responses, the researcher probed until all relevant views had been expressed. The researcher

then moved onto the next question. Any digression from the question posed was allowed to

continue for a time before the researcher guided the respondent back to the original point. The

average duration of each interview was approximately two hours.

4.2.3. Instrumentation

Interviews were based upon a structured questionnaire that was composed of 143 questions with

which to provide focus to the session., A Likert-type scale of ‘1’ (very low) to ‘6’ (very high),

with no ‘neutral’ point available, was used for individual items to force respondents to make a

‘non-neutral’ response.

The questionnaire was developed through a systematic process of critical reflection and

appraisal of the relevant research literature. First, numerous short discussions and meetings

were held with several of the nine respondents, during which general ideas and concerns

regarding the inter-organisational and operational culture of project-based joint ventures were

investigated and explored. Second, such data was then combined with the principal

investigator’s own observations and reflection, concerning his own extensive and lengthy

experience with similar construction and engineering projects in Hong Kong. Third and finally,

a literature review was undertaken relevant to project-based joint ventures, regarding such

aspects as trust, commitment, inter-organisational learning, competitive advantage, and

knowledge-based management (e.g., Doz & Hamel, 1998; Ganesan, Hall, & Chiang, 1996;

Hampden-Turner & Trompenaars, 2000; Matthews, 1999). The questionnaire could therefore be


85

appropriately researched and constructed with obtained results analysed and used to both inform

and guide understanding of the inter-organisational and operational culture of project-based

joint ventures within the Hong Kong construction and engineering industry.

4.2.4. Sample Size and Characteristics

The sample included nine senior executives who were recruited from five construction and

engineering companies based in Hong Kong. These included two personnel from a French-

owned organisation [ i.e., ‘Dragages at Travaux Public (Hong Kong) Ltd.’ (subsidiary part of

the ‘Bouygues Group’) ], one from a Japanese-owned organisation (i.e., ‘Nishimatsu

Construction Co. Ltd’), four from a United Kingdom-owned organisation (i.e., ‘Gammon

Construction Ltd.’, previously known as ‘Gammon Skanska Limited’), one from The People’s

Republic of China (‘PRC’)-owned organisation (i.e., ‘China Harbour Engineering Group.’), and

one from a Hong Kong-owned organisation (i.e., ‘Zen Pacific Construction Co.’). The gross

annual turnover of those organisations ranged from US Dollars $300 Million to $1Billion.

Interviewed senior executives had their ‘country-of-origin’ as follows: two were French

representing the French-owned organisation; four were from the United Kingdom (UK)

representing the UK-owned organisation; one was from the ‘UK’ representing the Hong Kong-

owned organisation; one was Japanese representing the Japanese-owned organisation; and one

was Chinese representing the ‘PRC’’-owned organisation. These individuals, recruited during

the research data-gathering phase, represented all senior executive personnel who at the time

were available to participate in this research.

4.2.5. Overview of the Data Analysis

Results were analysed through focusing on senior executives’ perspective of the inter-

organisational culture of project-based joint ventures in the Hong Kong construction and

engineering industry. Specifically, such issues which were investigated included: (i) identifying

what project-based joint venture partners wanted (i.e., expansion, maintenance, synergy); (ii)

identifying vulnerability/risk factors and trust/commitment concerns; and (iii) the manner in

which they planned to achieve their aims in order to achieve the objectives which satisfied their

clients’ project-related needs (i.e., organisational and operational foci).

The findings of this research are presented in Tables 4.1 to 4.9. Due to the small sample size (n

= 9) of this exploratory study, however, it was deemed inappropriate to undertake and conduct

complex statistical analysis of the results (e.g., analysis of variance of means, factor analysis).

Results are therefore only based on the raw data (see Appendix C) that were gathered using the


86

structured questionnaire, developed specifically for this exploratory study. Furthermore, only

the raw data of 27 of the 143 questions are presented. These questions had a mean response to

individual items with either ‘high’ (i.e., ‘4’ and above) or ‘low’ (i.e., ‘3’ or below) data values.

Tables 4.1 to 4.9 contain, the individual raw data for responses to questions posed by the

researcher to the nine respondents, together with the sample group means for the French (‘Fr’; n

= 2), United Kingdom (‘UK’; n = 4), and those respondents classified within the group defined

as ‘Other’ [ n = 3; i.e., Japanese (‘Jp’), The People’s Republic of China (‘PRC’), Hong Kong

(‘HK’) ].

4.3. Results

The results are presented in two sections, as follows: (i) JV Design: Culture of Inter-

Organisational Learning (i.e., Attitudes towards Inter-Organisational Learning, Reasons Why

Learning May be Important to JV’s, How Learning May be Achieved in JV’s); and (ii) JV

Design: Organisational and Operational Culture (i.e., What JV’s Want and Offer –

‘Expansion/Maintenance’ and ‘Synergy’; JV Design: Inter-Organisational Trust and

Commitment; Vulnerability and Risk Sharing; Organisational and Operational Foci).

4.3.1. JV Design: Culture of Inter-Organisational Learning

Table 4.1 reports the findings which were obtained from the interviewed respondents (n = 9)

concerning respondents’ attitudes towards the culture of inter-organisational learning within

project-based joint ventures (JV’s) in the Hong Kong construction and engineering industry.

Table 4.1: Attitude Towards the Culture of Inter-Organisational Learning Within JV’s

Item Attitude Towards the Culture of Inter-Organisational Learning Within JV’s A3 Is gaining competence important - both to remedy skill deficits and to develop new

competencies for the future, or through learning internally within the JV and JV partners ? (1 = not important; 6 = very important)

D4 Does your company have adequate capabilities and skills to harness the future ? (1 = inadequate; 6 = adequate)

D5 Do your JV partners possess specialised capabilities and skills ? (1 = inadequate; 6 = adequate)

D6 Will your partners be willing to share them with you ? (1 = willing; 6 = unwilling) D7 Does your dependence on JV partners concern your company ? (1 = concerned; 6 =

unconcerned) D11 Does your organisation face skill gaps ? (1 = not really; 6 = yes sometimes) D12 Are your partners' skills very different from yours ? (1 = not really; 6 = yes sometimes) D13 Do your partners have areas of competence that you don't understand, and vice versa ?

(1 = not really; 6 = yes sometimes) D14 Does the JV partners’ organisation, business processes, and work practices of your partners

reflect the nature of their skill base ? (1 = no reflection; 6 = yes it does reflect) D15 How interdependent and interlinked are the various areas of skills, both for your partners and

for your organisation ? (1 = not really interlinked; 6 = very interlinked)


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K5 Are any of the differences between you and your partners, in how work gets done, likely to make joint work in the alliance hard to perform ? (1 = not really; 6 = yes definitely)

K6 Are these differences likely to make you uncomfortable about working together again in the future ? (1 = not really; 6 = yes possibly)

K7 Might this, in turn, prevent learning ? (1 = not really; 6 = yes possibly) M1 As they enter the partnership, do your managers and specialists feel secure enough in their

position with your company so that they feel free to adjust to the partner's ways of working and to adapt their own behaviour in order to make the alliance work ? (1 = not very secure; 6 = comfortable)

M3 Is mutual dependence accepted by members of the partner organisations ? (1 = not really; 6 = mostly, yes)

M7 Is the enhanced profile of the JV understood and shared by all at the personnel level ? (1 = sometimes not ; 6 = mostly, yes)

Individual Respondent Group Means Item Fr1 Fr2 UK1 UK2 UK3 UK4 Jp1 PRC

1 HK1 Fr

(n = 2)

UK (n = 4)

Other (n = 3)

A3 5 1 5 5 6 6 3 6 4 3.00 5.50 4.33 D4 6 6 2 4 2 1 3 5 3 6.00 2.25 3.67 D5 6 5 2 4 5 3 5 6 5 5.50 3.50 5.33 D6 1 1 5 3 2 5 2 5 5 1.00 3.75 4.00 D7 1 1 1 3 3 1 5 2 3 1.00 2.00 3.33 D11 5 1 6 6 6 6 5 5 5 3.00 6.00 5.00 D12 6 2 4 6 6 6 3 2 5 4.00 5.50 3.33 D13 5 4 2 6 6 6 5 2 5 4.50 5.00 4.00 D14 4 5 2 4 6 6 5 5 5 4.50 4.50 5.00 D15 5 5 2 3 5 6 3 5 4 5.00 4.00 4.00 K5 1 2 4 4 5 6 3 2 3 1.50 4.75 2.67 K6 1 2 4 5 4 6 3 1 4 1.50 4.75 2.67 K7 1 2 4 5 4 5 2 2 4 1.50 4.50 3.33 M1 4 6 4 4 2 3 4 5 3 5.00 3.25 4.00 M3 3 5 4 4 4 2 2 4 4 4.00 3.50 3.33 M7 4 6 5 3 2 3 5 5 3 5.00 3.25 4.33 As shown in Table 4.1, in response to Items A3 to M7, respondents’ attitudes toward the culture

of inter-organisational learning between partner companies were not identified of concern.

However, it was found that all respondents tended to be somewhat concerned with perceived

knowledge-based limitations in the attainment of specialised skills and capabilities in the

project-based joint venture. Although the responses to three of the organisational cultural

competency items (refer to K5, K6, and K7), particularly by the four ‘UK’ respondents, may

suggest a moderate recognition of deficits in the knowledge of organisational culture between

partner companies within project-based joint ventures, this was not notably so. However, the

relatively low responses by the ‘UK’ and ‘Other’ (i.e., Japan, The People’s Republic of China,

Hong Kong) respondents to the mutual dependency items (refer to M1, M3, and M7), indicated

that the cultural sharing of knowledge-based skills and resources between partner companies

was of significant concern. Of exception, however, the ‘Fr2’ and ‘Jp1’ respondents appeared to

attach little or no importance toward establishing and developing project-based joint ventures in


88

order to develop and address identified skill deficits. In contrast, the remaining seven

respondents positively accompanied the significance of such relationships with partner

companies in the development of new skill competencies for the future.

In addition, the responses by all respondents to Items D4 to D6 reveal a recognised need for JV

partners with deficit knowledge-based skills and competencies to make concerted efforts to

‘bridge’ such gaps in order to harness knowledge, capabilities, and technological skills for the

future. In particular, in response to Item D4, the two French respondents indicated that their

companies possessed all the requisite knowledge-based skills in order to ‘harness the future’.

Furthermore, such individuals reported that JV partner companies, with whom they were

involved, possessed specialised capabilities and skills (see Item D5). In addition, the two French

respondents indicated that such companies were willing to share knowledge-based expertise and

learning (see Item D6).

In contrast, however, the ‘HK1’ and four ‘UK’ respondents reported high levels of inadequacy

in possessing organisational knowledge-based skills, relative to their other JV partners, with

whom they were involved, who possessed such skills (refer to Items D4 to D6). Furthermore,

the ‘HK1’ and ‘UK’ respondents adhered to the belief that their own JV partners would be

unwilling to share and exchange their specialised knowledge-based learning skills with their

own organisation.

Conversely, the ‘Fr1’, ‘Fr2’, ‘Jp1’, and ‘PRC’’ respondents conferred that their own

organisational companies possessed either a modest (in the case of ‘Jp1’), or high (in the case of

‘Fr1’, ‘Fr2’, and ‘PRC’’) level of adequacy in terms of knowledge-based skills and capabilities

with which to ‘harness the future’ (see Item D4). Likewise, these four respondents recognised

that their JV partners tended to possess a similar (in the case of Fr1’, ‘Fr2’, and ‘PRC’’) or

greater (in the case of ‘Jp1’) level of specialised skills and capabilities, relative to their own

organisational companies (see Item D5). However, with the exception of the ‘Fr1’ and ‘Fr2’

respondents, the ‘Jp1’, and ‘PRC’’ individuals conferred that ‘partner’ companies remained

willing to share knowledge-based learning with their own company (see Item D6).

All nine respondents, therefore, appeared to express a relatively high level of confidence in the

capacity of their organisation to harness important inter-organisational knowledge-based

learning capabilities and skills for the future through project-based joint ventures. Furthermore,

with the exception of the ‘UK’ respondents where there were mixed responses, there appeared


89

to be general consensus by other individuals, regarding the willingness of partner companies to

share knowledge-based learning.

However, based on Item D7, all respondents expressed high levels of concern regarding their

dependency upon JV partner companies. Hence, such results highlight the capacitated need for

learning. For example, in response to Items D11 to D15, all respondents appeared to be quite

aware of identified skills gap which existed in present levels of organisational technology,

business processes, as well as in their own identified levels of technical competency.

Furthermore, all respondents indicated that this organisational knowledge gap was regarded as

‘mutual’ between JV partners in that the level of inter-organisational skills between partner

companies that were involved in project-based joint ventures tended to be strongly interlinked.

In terms of the perceived differences between partner companies and how this was likely to

influence how work was undertaken and performed, the responses of the nine individuals to

Item K5 in Table 4.1 were interesting to reflect upon. For example, five of the nine respondents

(i.e., ‘Fr1’, ‘Fr2’, ‘Jp1’, ‘PRC1’, ‘HK1’) indicated that low levels of problems were likely to

occur despite the level of perceived differences in the organisational culture of differing partner

companies. In contrast, however, the four ‘UK’ respondents appeared to anticipate strong levels

of difficulty which may arise through differences in how work within the project-based joint

venture was undertaken and conducted in shared co-operation with differing partner companies,

in terms of inter-organisational learning and work methods (refer to Items K6 and K7).

In Table 4.1, the ‘M’ series of questions reveal some interesting results. Namely, according to

Item M1, respondents suggested that managerial security was of concern, and hence, a

perceived barrier to ‘openness’ in supporting the transfer of inter-organisational knowledge-

based learning between partner companies. In support, three of the nine responses were

relatively low (i.e., ‘UK3’, UK4’, ‘HK1’) , four recorded a value of ‘4’ (just above ‘neutral’)

(i.e., ‘Fr1’, ‘UK1’, UK2’, ‘Jp1’), and only two individuals (i.e., ‘Fr2’, ‘PRC1’) expressed high

levels of security in their position towards adjusting and adapting towards their partner

company’s ‘ways of working’ in order to make the project-based ‘alliance’ tenable. In

accounting for such findings, it appears that respondents’ expressed level of reticence towards

their partner company’s ‘ways of working’ in developing and establishing JV’s may be due to a

perceived degree of uncertainty where ‘openness’ and the ‘emotional infrastructure’ for inter-

organisational knowledge-based learning appears constrained (refer to Item M3). There was,

however, ‘guarded optimism’ in that five of the nine respondents (i.e., ‘Fr1’, ‘Fr2’, ‘UK1’,

‘Jp1’, ‘PRC1’) expressed a high level of acceptance towards embracing the organisational


90

cultural diversity and difference in the skills of managers and staff involved in the governance

of project-based joint ventures in the Hong Kong construction and engineering industry (refer to

Item M7).

Given the above, in terms of embracing the differing organisational ‘working culture’ of partner

companies which are involved in joint ventures, the findings from Items M1, M3, and M7

appear to confer, in part, with the process of team building. Namely, such ‘partnerships’

between differing organisational companies may involve a ‘forming, storming, norming,

performing, and mourning’ cycle of team cohesion, which may account for how knowledge-

based competitive advantage may be promoted between organisational companies engaged in

project-based joint ventures (Dunford, 1992; Turner, 1999). Therefore, the framing and

reframing of inter-organisational culture is likely to impact and influence how groups of

individuals may seek to operate and work together through appropriate leadership and the

willingness to learn and experiment with new knowledge-based concepts, tools, and ideas

(Bolman & Deal, 1991).

In support, given by the responses to Items A3 and M7, the results in Table 4.1 demonstrate that

inter-organisational learning is very important to JV partner companies. Other item responses,

however, appear to indicate some level of reticence together with favourable attitudes toward

how inter-organisational learning may be achieved between partners involved in project-based

joint ventures. For example, based on Items D4 to D15, respondents indicated that within the

context of the project-based joint venture between organisational companies, there were

identified organisational knowledge gaps that need to be ‘bridged’ through developed processes

of inter-organisational learning.

An understanding of the significance, and importance of inter-organisational learning in project-

based joint ventures within the Hong Kong construction and engineering industry will be

explored in more detail in Table 4.2.

Table 4.2: Reasons Why Learning May Be Important To JV’s

Item Reasons Why Learning May Be Important To JV’s B8 How focused is your marketing/business strategy for brand, reputation, corporate image,

credibility ? (1 = not important; 6 = very important)

C1 Is it a superior arrangement when a partner can make unique contributions such as enhanced competencies, have good government contacts and “insider” status that cannot be traded easily between companies ? (1 = not really; 6 = highly desirable)


91

C2 Is it desirable to have a partner making unique contributions that cannot be substituted? For example, there is no alternative partner and/or no alternative source for the contribution. (1 = not really; 6 = most definitely)

C3 Is it desirable to have a partner making unique contributions that cannot be developed or copied independently within a reasonable time frame ? (1 = not necessary; 6 = highly desirable)


1 HK1 Fr

(n = 2)

UK (n = 4)

Other (n = 3)

B8 6 6 5 5 6 5 5 6 5 6.00 5.25 5.33 C1 6 6 5 6 6 6 6 5 5 6.00 5.75 5.33 C2 3 2 2 4 6 6 6 6 5 2.50 4.50 5.67 C3 2 2 2 4 6 6 6 6 3 2.00 4.50 5.00

As shown in Table 4.2, the responses to Item B8 indicated that all respondents regarded all the

focus upon ‘brand’, ‘reputation’, ‘corporate image’, and ‘credibility’ as important to ensure

success within the project-based joint venture between partner companies. While this was not

unexpected, such findings reinforced the significance of ‘credibility’ and the ability to provide

suitable skills with which to bridge identified and perceived inter-organisational knowledge

gaps between partner companies within the context of project-based joint ventures in the Hong

Kong construction and engineering industry. Furthermore, with the exception of the ‘Fr1’, ‘Fr2”

and ‘UK1’ respondents to Items C2 and C3, all individuals indicated that it was highly desirable

for partner companies to be able to uniquely contribute their own organisational expertise,

skills, knowledge, and competencies toward the success of the project-based joint venture (refer

to Items C1, C2, and C3). As a consequence, such results afcompany the need for skill-

matching, as well as the importance that partner companies each have a unique contribution to

make towards the success of the project-based joint venture. While this may account for why

project-based joint ventures are established and developed, such joint ventures may also provide

an opportunity to generate knowledge-based learning through exposure to the new skills of

partner companies in order to gain and acquire market-based competitive advantage within the

corporate business sector. The results, as shown in Table 4.3, indicate how this may be

achieved.

Table 4.3: How Learning May Be Achieved Within JV’s

Item How Learning May Be Achieved Within JV’s. D1 If skill gaps were identified within your company, how would you address them ?

(a) Get involved with a more experienced company (1 = likely; 6 = more than likely) D2 If skill gaps were identified within your company, how would you address them ?

(b) Purchase these skills by hiring the right people (1 = likely; 6 = more than likely)


92

D3 If skill gaps were identified within your company, how would you address them ? (c) Licensing appropriate/new technologies (1 = likely; 6 = more than likely)

D8 Do you need to learn capabilities and skills, that you are dependent upon a JV partner yourself, if you don't want your bargaining power in the JV to become weak and your position thus precarious ? (1 = do need to learn; 6 = do not need to learn)

D9 If the required capabilities and skills are new, how much can you benefit from developing them jointly with partners (for example, in engineering) ? (1 = not much; 6 = greatly)

D10 As you plan your strategies (and technology road maps) for the next 5 years, have you considered a number of alliances with different partners allowing you to access the range of required capabilities and skills over this period ? (1 = not much; 6 = greatly)

G7 Do you build bridges between partners at multiple levels ? (1 = not normally; 6 = absolutely) L3 Did you make an effort to learn how partner organisations really operate ?

(1 = not really; 6 = yes, definitely) L4 Do you refrain from making premature judgements about the partner’s ways of working ?

(1 = not really; 6 = yes, definitely) L6 Do you and your partners create space and time (for instance, in joint workshops and seminars)

for members of the partner organisations to share and understand their respective organisational contexts? (1 = not really; 6 = yes, definitely)


1 HK1 Fr

(n = 2)

UK (n = 4)

Other (n = 3)

D1 5 1 4 4 6 6 2 5 6 3.00 5.00 4.33 D2 5 4 4 5 5 6 2 5 4 4.50 5.00 3.67 D3 3 4 2 5 4 3 3 4 3 3.50 3.50 3.33 D8 5 1 6 5 5 6 5 3 4 3.00 5.50 4.00 D9 5 2 1 6 5 6 5 4 3 3.50 4.50 4.00 D10 6 6 5 6 6 6 6 5 5 6.00 5.75 5.33 G7 5 5 6 4 6 5 5 5 4 5.00 5.25 4.67 L3 6 5 5 5 6 4 5 5 3 5.50 5.00 4.33 L4 6 5 5 5 6 2 5 5 3 5.50 4.50 4.33 L6 6 4 4 4 5 6 4 5 2 5.00 4.75 3.67

In Table 4.3, based on the responses to Items D1 to D3, respondents indicated that the most

probable course of action, in acquiring a culture of knowledge-based management and

organisational skills, was through actively involving others through ‘getting involved with a

more experienced company’, ‘hiring the right people’, and ‘licensing new/appropriate

technologies’. Of exception, however, the ‘Jp1’ respondent appeared to remained distinct,

relative to the other eight individuals, in rating Items D1 to D3 consistently low. The differing

responses of the ‘Jp1’ respondent, as compared with the other eight individuals may be due to

the Japanese construction industry tending to maintain very large research and development


93

departments to develop product innovation and technological-based improvement (Harkola,

1994).

Furthermore, based on the responses to Items D8 to D10, respondents indicated that a proposed

organisational strategy for acquiring joint knowledge-based capabilities and skills was through

developing and establishing project-based joint ventures with rival companies. Similarly, an

equally strong consensus appears to prevail in the response to Item G7. Namely, ‘bridges of co-

operative learning’ were considered as the preferred way forward in the attainment of

knowledge-based competitive advantage, and in this case for Item G7, the Japanese response

was in positive agreement with the other eight individuals.

Of particular significance, with the exception of the ‘HK1’ respondent, it is interesting to reflect

upon how the remaining eight respondents indicated how national and organisational culture

seek to strongly influence how inter-organisational knowledge-based learning may be achieved

(refer to Items L3, L4 and L6). In contrast, however, the ‘HK1’ respondent recorded a relatively

low response to these three items.

In accounting for such findings, it may be that ‘locally’-owned companies (as represented by

the ‘HK1’ respondent) set and establish appropriate ‘cultural’ norms in terms of ways of

working, and it is up to ‘foreign’-owned JV partners to learn to be able to adapt to such

practices. Hence, this may present an identified barrier towards the transfer of organisational

knowledge-based learning for ‘foreign’-owned organisations (as represented by the ‘Fr1’, ‘Fr2’,

‘UK1’, ‘UK2, ‘UK3’, ‘UK4’, ‘Jp1’, and ‘PRC’ respondents).

4.3.2. JV Design: Inter-Organisational and Operational Culture

This section examines senior executives’ understanding of the inter-organisational and

operational culture of project-based joint ventures between partner companies within the Hong

Kong construction and engineering industry. The variables which will be explored in examining

the culture of project-based joint ventures include: (i) What JV’s Want and Offer –

‘Expansion/Maintenance’ (Table 4.4) and ‘Synergy’ (Table 4.5); (ii) Inter-Organisational Trust

and Commitment (Table 4.6); (iii) Vulnerability and Risk Sharing (Table 4.7); (iv)

Organisational Foci (Table 4.8); and (v) Operational Foci (Table 4.9).

One dimension of what JV’s want and offer is through business expansion, maintenance of

profits, and/or the creation of new business opportunities, as presented in Table 4.4

(‘Expansion/Maintenance’) and Table 4.5 (‘Synergy’).


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Table 4.4: What JV’s Want and Offer – ‘Expansion/Maintenance’

Item What JVs Want and Offer – ‘Expansion/Maintenance’ A1 Does each partner seek to gain strong competitive capabilities through forming a JV ?

(1 = not important; 6 = very important) A2 Do JV’s have expectations to leverage joint resources between partners to exploit new

opportunities ? (1 = less expectations; 6 = high expectations)

A4 Do JV partners seek to create value and better profits for its shareholders ? (1 = not important; 6 = very important)

E8 Are you content with your present position in the market ? (1 = not satisfied; 6 = very satisfied)

Individual Respondent Group Means Item Fr1 Fr2 UK1 UK2 UK3 UK4 Jp1 PRC HK1 Fr

(n = 2)

UK (n = 4)

Other (n = 3)

A1 5 6 5 5 6 6 6 5 5 5.50 5.50 5.33 A2 5 6 5 5 5 6 5 5 3 5.50 5.25 4.33 A4 4 6 5 6 6 5 4 6 5 5.00 5.75 5.00 E8 5 2 1 2 2 2 1 6 2 3.50 1.75 3.00

Table 4.4 illustrates that business success attainment of ‘strong competitive capabilities’ was

deemed important, as represented by a strategic focus on serving the customer through

establishing and developing project-based joint ventures in order to exploit new opportunities

with other rival companies (refer to Items A1 and A2). Further, with the exception of the ‘Fr1’

and ‘Jp1’ respondents, all other individuals placed high importance upon the project-based joint

ventures, in terms of the value and creation of profit motivation for shareholders (see Item A4),

as supported by a perceived motivation towards opportunity growth (see Item E8). In part, in

response to Item E8, this may reflect a general lack of contentment with respondents’

perspective regarding the present competitive status of their own organisation in the business

market In addition, it may reflect the tendency of such companies to place greater emphasis

upon market share, customer satisfaction, and other factors relevant toward a need to satisfy a

wider group of stakeholders.

4.3.2.1. Joint Venture Design: What Joint Ventures want and have to offer-“Synergy”

Another dimension important within the context of project-based joint ventures relates to

‘synergy’ expectations, in which JV partners seek to maximise or optimise joint services in

order to meet customer needs. Table 4.5 reports the responses of respondents to Items B5 to E7.


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Table 4.5: What JV’s Want and Offer – ‘Synergy’

Item What JV’s Want and Offer – ‘Synergy’ B5 Share of customer attention, customer access ? (1 = not important; 6 = very important) B6 Density of coverage locally for service and competitive advantage ?

(1 = not important; 6 = very important) B8 Brand, reputation, corporate image, credibility ? (1 = not important; 6 = very important) B11 If you try to build a JV alliance, do you make yourself ‘attractive’ to partners ?

(1 = no effort; 6 = make an effort) B12 What uniqueness do you bring ? (1 = none; 6 = some uniqueness) C1 Is it a superior arrangement when a partner can make unique contributions such as enhanced

competencies, have good government contacts and "insider" status that can not be traded easily between companies ? (1 = not really; 6 = highly desirable)

D10 As you plan your strategies (and technology road maps) for the next 5 years, have you considered a number of alliances with different partners allowing you to access the range of required capabilities and skills over this period ? (1 = not considered; 6 = seriously considered)

D11 Does your organisation face skill gaps ? (1 = not really; 6 = yes, sometimes) E7 Do partners seek to use the alliance to improve their status in the industry ?

(1 = yes, sometimes; 6 = always)


(n =2)

UK (n = 4)

Other (n = 3)

B5 5 6 5 5 4 6 5 5 5 5.50 5.00 5.00 B6 5 6 5 5 5 6 5 5 5 5.50 5.25 5.00 B8 6 6 5 5 6 5 5 6 5 6.00 5.25 5.33 B11 5 6 3 4 6 6 4 6 5 5.55 4.75 5.00 B12 6 6 4 6 6 4 5 5 5 6.00 5.00 5.00 C1 6 6 5 6 6 6 6 5 5 6.00 5.75 5.33 D10 6 6 5 6 6 6 6 5 5 6.00 5.75 5.33 D11 5 1 6 6 6 6 5 5 5 3.00 6.00 5.00 E7 5 6 5 5 5 3 5 6 5 5.50 4.50 5.33

Table 4.5 indicates a strong emphasis on gaining ‘synergy’ through: (i) customer access (i.e.,

Item B5); (ii) customer focus (i.e., Item B6); (iii) reputation and brand image (i.e., Items B8 and

E7); (iv) provision of unique qualities/services (i.e., Items B12 and C1); (v) being ‘attractive’

(i.e., Item B11); and (vi) through accessing required capabilities and skills (i.e., Items D10 and

D11).

Furthermore, as given by Item B5 to E7 in Table 4.5, partner companies were highly selective

in choosing other organisational companies in order to improve and enhance their competitive


96

status and position for the ‘client’. Namely, this tended to be through inter-organisational

learning opportunities for knowledge-based skill enhancement and technology transfer. In

addition, there was a strong need to enhance business opportunities, that could not be easily

accessed individually, through the development of a number of project-based joint ventures

with other organisations in order to ensure sustainable competitive advantage.

4.3.2.2. Joint Venture Design: Inter-Organisational Trust, Commitment, Vulnerability and Risk

Sharing

Within the inter-organisational and operational culture of project-based joint ventures, inter-

organisational trust and commitment between companies are of crucial importance (Green &

Lenard, 1999; Whiteley, McCabe, & Lawson, 1998). The notion of inter-organisational ‘trust’ is

highly complex. It implies confidence that the other organisation’s actions will be consistent

with their word. Namely, inter-organisational ‘trust’ relates to an organisational company being

concerned with the welfare and interests of the other partner company involved in the project-

based joint venture, in maintaining that a certain action or event will or will not occur under a

given set of conditions because of agreed upon decision-making policies and practices (Rogers,

1995).

Inter-organisational commitment is the physical and mental manifestation of the concept of

inter-organisational ‘trust’. It may be regarded as the ‘proof’ of inter-organisational ‘trust’.

Namely, inter-organisational commitment represents the willingness to reciprocate and

transform energy between companies involved in project-based joint ventures into tangible

results. Further, inter-organisational commitment implies that another company will embrace

the concept of inter-organisational ‘trust’ in order to ‘live up to’ the ‘spirit of the bargain’, than

otherwise would be the case. Therefore, this implies that a ‘trusting’ company would refrain

from detailed specification and control, in terms of how decision-making tasks should be

performed.

Loyalty occurs when inter-organisational ‘trust’ and commitment are tested. It may be

considered as the ‘bankable capital’ of goodwill to reciprocate ‘trust’ in times of financial

adversity. One demonstration of an act of loyalty may be for an organisational company to

sacrifice something in the short-term in order to ensure that a long-term inter-organisational

relationship remains intact and functional for competitive mutual advantage (Walker, Hampson,

& Peters, 2000). It is important, however, that such a reciprocal and mutual relationship

between companies is not exploited. This is because forcing or coercing partnering

arrangements, without adequately developing the groundwork for inter-organisational ‘trust’,


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may be potentially problematic in the development of inter-organisational commitment and

collaboration within project-based joint ventures, in terms of the cost associated with

abandoning an alliance or switching from one partner company to another (Doz & Hammel,

1998; Lazar, 2000). Hence, as a result, it was anticipated that inter-organisational

vulnerability/risk sharing, ‘trust’ and commitment would be significant factors in influencing

the design and functioning of project-based joint ventures within the Hong Kong construction

and engineering industry.

The findings of this present research, relevant toward understanding inter-organisational ‘trust’

and commitment between companies involved in project-based joint ventures within the Hong

Kong construction and engineering industry, are shown in Table 4.6.

Table 4.6: JV Design: Inter-Organisational Trust and Commitment

Item Inter-Organisational Trust and Commitment B18 Are you able to influence the leaders of the JV in their decision making process ?

(1 = occasionally; 6 =yes, mostly) B19 If you were perceived as a weak minority partner, would you allow the stronger JV partner to

set the pace, do as he pleases without too much interference ? (1 = unlikely; 6 = more than likely)

E1 Do you try to understand the respective, competitive positions of the partners’ other core business activities ? (1 = try to understand; 6 = don't care about other partners)

E9 Have you considered the alliance to be means to allow you to phase exit from a market loss making sector ? (1 = never; 6 = has been considered)

E14 Do you consider trust an important issue when looking at a new JV ? (1 = not seriously; 6 = most seriously)

E20 Is your commitment to the alliance unquestioned ? (1 = not strongly; 6 = strongly) F1 How clearly do you understand the strategic scope of the alliance for yourself and your

company? Does it include performance obligations ? (1 = not really; 6 = most definitely) F2 How clearly do you understand the strategic scope of the alliance for yourself and your

company? Does it include a full commitment from your Board of Directors ? (1 = not really; 6 = most definitely)

G10 To what extent do you need to influence? (1 = no influence desired; 6 = greatly, influence sought)

L7 Do partners exchange enough personnel or is the relationship kept at “arm’s length” ? (1 = arms length; 6 = exchange personnel)

M4 Are any members of your organisation or your partners likely to see the need for the alliance to be a success or a failure ? (1 = failure; 6 = success)

M5 Do JV partners understand the likely personal consequence of alliance success and failures ? (1 = not fully understood; 6 = fully understood)

Individual Respondent Group Means Item Fr1 Fr2 UK1 UK2 UK3 UK4 Jp1 PRC HK1 Fr UK Other


98

(n =2)

(n = 4) (n = 3)

B18 5 5 5 5 6 6 6 5 5 5.00 5.50 5.33 B19 1 3 2 2 1 3 5 2 5 2.00 2.00 4.00 E1 1 5 1 2 1 1 5 2 1 3.00 1.25 2.67 E9 1 1 5 4 1 1 2 4 1 1.00 2.75 2.33 E14 6 6 6 6 6 6 5 6 6 6.00 6.00 5.67 E20 6 6 5 4 6 6 6 6 5 6.00 5.25 5.67 F1 6 6 6 5 6 6 5 6 5 6.00 5.75 5.33 F2 6 6 6 5 6 6 6 6 5 6.00 5.75 5.67 G10 5 5 5 5 6 6 4 4 5 5.00 5.50 4.33 L7 1 2 1 2 2 3 4 5 2 1.50 2.00 3.67 M4 6 6 5 5 6 6 6 5 5 6.00 5.50 5.33 M5 5 6 5 5 5 6 5 5 5 5.50 5.25 5.00

Table 4.6 Items B18, B19, and E14 indicate that respondents supported the need for a high level

of trust in project-based joint ventures, based upon an equitable balance of power between

partners in decision-making processes. In addition, a high level of inter-organisational

commitment was regarded as important as well to the success of the project-based joint venture

between companies (see Item E20). With the exception of three of the 9 respondents (i.e.,

‘UK1’, ‘UK2’, and ‘PRC’’), when asked whether partner companies would use a project-based

joint venture as an ‘exit’ strategy, the remaining six respondents indicated with a response of

‘not really’, thus reinforcing the notion of inter-organisational commitment towards the success

of the JV partnership between companies (see Item E9). In addition, mutual acknowledgement

of the competitive position of partners and performance obligations of partner companies,

involved in project-based joint ventures, were also clearly understood (see Items F1 and E1).

In response to Item L7, seven of the 9 respondents (i.e., ‘Fr1’, ‘Fr2’, ‘UK1’, ‘UK2’, ‘UK3’,

‘UK4’, and ‘HK1’) indicated that it remained preferable to ‘distance’ the influence of inter-

organisational personnel, who were involved within the project-based joint venture. Further

probing with respondents, however, revealed that JV partners often did not want to integrate

personnel ‘too closely’ due to perceived differences in inter-organisational culture, workplace

conditions and reward systems, in terms of factors which were considered to cause ‘tension’ or

‘friction’ between personnel seconded within other organisations. As a result, such a finding

tends to remain contrary to that of the relevant literature, where it has been reported that inter-

organisational learning from ‘partnered’ organisations occurs primarily through staff exchange

and secondment within the culture of other companies (Womack & Jones, 2000).


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Table 4.7 presents the results of the present research, relevant toward understanding issues of

JV design vulnerability and risk sharing.

Table 4.7: JV Design: Vulnerability and Risk Sharing

Item Vulnerability and Risk Sharing B13 How critical, are assurances for potential fears of dependence, allayed on the part of partners ?

(1 = not critical; 6 = very critical) D7 Does your dependence on a JV partner concern your company ? (1 = concerned; 6 =

unconcerned) E4 As JV partners, are you likely to converge toward the same competitive space outside the

alliance ? (1 = unlikely; 6 = highly likely)

E6 Do you need to understand the strategic ambitions of the various partners ? (1 = not necessary; 6 = necessary)

E12 How seriously do you consider risk taking by each partner within a JV ? (1 = not seriously; 6 = very seriously)

E13 How seriously do you consider risk sharing by each partner within a JV ? (1 = not seriously; 6 = very seriously)

E25 Are you willing to help your partners improve their competitive position ? (1 = not really; 6 = possibly)

I1 Is your JV perception incompatible with that of your partners, for instance, do you see the alliance as a step towards a merger and they see it as a temporary co-operative agreement ? (1 = not normally; 6 = yes, definitely)

J1 How realistic are your expectations and those of your partners ? (1 = not very; 6 = fairly realistic)


(n = 2)

UK (n = 4)

Other (n = 3)

B13 5 5 6 5 6 6 5 5 2 5.00 5.75 4.00 D7 1 1 1 3 3 1 5 2 3 1.00 2.00 3.33 E4 6 6 6 5 5 6 6 5 5 6.00 5.50 5.33 E6 6 5 5 6 6 6 5 5 5 5.50 5.75 5.00 E12 6 6 6 6 6 6 6 4 2 6.00 6.00 4.00 E13 6 6 6 6 6 6 6 6 5 6.00 6.00 5.67 E25 1 3 2 4 2 1 2 5 3 2.00 2.25 3.33 I1 1 2 2 4 3 1 2 2 2 1.50 2.50 2.00 J1 6 5 4 6 6 6 3 5 5 5.50 5.50 4.33

Table 4.7, Item B13 suggests that ‘potential fears of dependence’ were allayed as very critical

on the part of partner companies. In contrast, with the exception of the ‘Jp1’ respondent, all

remaining eight individuals indicated that their own organisations’ dependence upon a JV


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partner had not raised any high level of concern (see Item D7). In exploring this issue through

further discussion with all respondents, it was found that when inter-organisational trust was

considered high, fear of vulnerability was effectively allayed.

In response to Items E4 and E6, all respondents conferred with the common understanding that

their own companies may be competing against one another in the future. Hence, this made it

necessary to understand the strategic ambitions of JV partners. However, respondents indicated

that such level of inter-organisational commitment did not extend towards sacrificing one’s own

competitive position with other JV partner companies whom they were involved with in project-

based joint ventures (see Item E25). Namely, there was general consensus concerning a

reluctance to help JV partners improve their competitive position, which might otherwise be to

the detriment of their own company. Taken together, such findings tend to reinforce the

importance of power equalisation amongst JV partners, and in terms of understanding the limits

of inter-organisational commitment, such that trust between companies may be established and

maintained.

In addition, issues of risk taking and risk sharing were considered to be of the highest

importance. For example, based on Items I1 and J1, all respondents indicated a strong desire for

understanding the expectations of JV partners, in terms of risk management. Taken together, JV

partner’s risk orientation and management appear to represent important factors in shaping JV

partner selection and subsequent relationship behaviours.

4.3.2.3. Joint Venture Design: Organisational and Operational Foci

Project-based joint venture management revolves around a number of fundamental operations

which have been documented and explained elsewhere within the relevant literature (Cleland,

1999; Morris, 1994; Turner, 2000). Important amongst these, as addressed in this section, are

inter-organisational planning and design, co-ordination, and decision making in monitoring

evaluation and control. In the context of the present research (refer to Table 4.8), the questions

which were asked of respondents, concerned how individuals of varied organisational and

cultural backgrounds, could seek to optimise their contractual relationship in order to co-

ordinate the focus of inter-organisational activity and assigned responsibilities within the

project-based joint venture between partner companies.


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Table 4.8: JV Design: Organisational Foci

Item Organisational Foci F9 Do you set the operational scope of the alliance, as well as its governance structure, so as to

minimise any difficulties between partners ? (1 = not necessary; 6 = most definitely) G2 Do you devote the amount of attention and effort to the JV to ensure profitable venture,

enhancing added value for each partner ? (1 = not normally; 6 = yes absolutely) G5 Is the design of your JV contribution capable of handling the task demands ?

(1 = not normally; 6 = generally yes) G6 Do you strive to decrease the task demands and to improve the interface ?

(1 = not intentionally; 6 = purposefully, yes) G7 Do you build bridges between partners at multiple levels ? (1 = not normally; 6 = absolutely) G10 To what extent do you need to influence ? (1 = no influence desired; 6 = greatly, influence

sought) J5 Have you involved those who will be responsible for implementing the alliance in the

negotiation process ? (1 = no need; 6 = yes definitely) L1 Have you recognised the importance of organisational and cultural compatibility in the design

of your alliance ? (1 = not important; 6 = most definitely) L2 Do you appoint to the JV, managers who have had experience working in different kinds of

cultures, nationality, organisation ? (1 = not really; 6 = normally yes)


(n = 2)

UK (n = 4)

Other (n = 3)

F9 5 6 6 5 6 6 5 6 5 5.50 5.75 5.33 G2 5 6 6 5 5 4 4 6 5 5.50 5.00 5.00 G5 6 6 5 5 5 6 5 5 4 6.00 5.25 4.67 G6 5 6 4 5 5 6 4 5 5 5.00 5.50 4.67 G7 5 5 6 4 6 5 5 5 4 5.00 5.25 4.67 G10 5 5 5 5 6 6 4 4 5 5.00 5.50 4.33 J5 5 5 5 5 6 5 6 3 5 5.00 5.25 4.67 L1 6 6 5 5 6 6 2 4 5 6.00 5.50 3.67 L2 6 5 5 4 5 6 5 5 5 5.50 5.00 5.00

All respondents highlighted inter-organisational design issues within project-based joint

ventures were by as important strategic considerations. For example, in response to Table 4.8

Item F9 question, all individuals signified the need for a dispute resolution system which

allowed for equality of power and influence, in order to resolve identified difficulties between

partner companies. Consistent with Item F9, further discussion with respondents reinforced the

need for maintaining the ‘power balance’ between partner companies, as well as support for a

‘value-adding’ inter-organisational culture in the delivery of technological and knowledge-


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based organisational resources and effort in order to ensure that the project-based joint venture

was a profitable exchange for each partner company (see Item G2).

In addition, based on the findings from Items G5, G6, G7, G10, and J5, all respondents agreed

that there was a need for decision-making practices to be structured in a way that involved

partner companies in the negotiation process. As a result, respondents conferred such decision-

making practices were important strategic considerations in a number of ways in ensuring

success of the project-based joint venture between companies. First, by enabling the efficient

and effective management of task responsibility and co-ordination (see Item G6). Second, by

providing ‘bridging interfaces’ between partnered companies at multiple levels (see Item G7).

Third and finally, in appointing managers to the project-based joint venture who had experience

in working in different kinds of ‘cultures, nationalities and organisations’ (refer to Items L1 and

L2).

Although Table 4.8 depicts some of the key strategic considerations important within the inter-

organisational culture of project-based joint ventures between partner companies, operational

focus issues can not be ignored. For example, the project management literature reinforces the

need to ensure that equal attention is paid towards strategically addressing the practical

organisational as well as the operational issues of project-based joint ventures in order to ensure

sustainable knowledge-based competitive advantage (e.g.., McDermott, 1999; Turner, 1999).

Table 4.9 illustrates some of the findings from the present research relevant towards the

operational foci of project-based joint ventures.

Table 4.9: JV Design: Operational Foci

Item Operational Foci H6 Do you distinguish in your assessment of progress, the value creation in efficiency ?

(1= not really; 6 = yes definitely) H7 Do you distinguish in your assessment of progress, the value creation in the value of benefits

for you ? (1 = not really; 6 = yes definitely)

I7 Do you share past JV experiences with your partners ? (1 = not normally; 6 = yes, mostly) I10 Do you resolve misunderstandings ? (1 = not really; 6 = yes, normally)


(n = 2)

UK (n = 4)

Other (n = 3)

H6 6 6 5 5 5 5 4 5 5 6.00 5.00 4.67 H7 6 6 5 5 5 6 4 6 5 6.00 5.25 5.00


103

I7 6 6 6 4 6 6 3 6 5 6.00 5.50 4.67 I10 6 6 5 5 6 6 6 5 5 6.00 5.50 5.33

Table 4.9 Item H6 indicates that all respondents afcompanyed the importance of operational

performance, in terms of ‘value creation in efficiency’. In addition, each respondent recognised

the need of ‘adding value’ through the contribution of inter-organisational and operational

expertise and services relevant to the project-based joint venture between companies (refer to

Item H7). Furthermore, all respondents strongly supported the need to share experiences,

lessons, and misunderstandings learned from past projects (see Items I7 and I10). For example,

the need to provide a system of dispute resolution at an operational level was evident, as

consistent with the relevant ‘partnering’ literature (Bresnen & Marshall, 2000b; Ellison &

Miller, 1995; Lendrum, 1998). As a consequence, with disputes that are politically or

technically difficult to resolve at one level, this allows organisational and operational risk at the

project level to be managed-up at the ‘best hierarchical level’ for those who are in a position to

pivotally manage such level of risk (Bennett & Jayes, 1995).

4.4. Discussion of the Findings of Study One: Implications for Study Two

The purpose of this exploratory research was to examine senior executives’ understanding of

the inter-organisational and operational culture of project-based joint ventures between partner

companies within the Hong Kong construction and engineering industry. Based on a

questionnaire, developed specifically for purposes of the present research, respondents were

requested to provide their understanding of what organisational cultural-related attributes and

characteristics were important in developing, establishing, and maintaining project-based joint

ventures with other partner companies within the Hong Kong construction and engineering

industry.

Due to the limited sample size (n = 9), it is not appropriate to provide either an accurate detailed

or generalised understanding of the inter-organisational and operational culture of project-based

joint ventures between partner companies within the Hong Kong construction and engineering

industry. It is appropriate, however, with exploratory research to provide senior executives’

deep insights concerning knowledge and perceptions of project-based joint ventures—as it is

frequently regarded as difficult and rare to gain access to this level of experience within this

industry. Hence, the findings of this research provide a useful framework with which to

understand the process of JV partner company interaction in the attainment of sustainable

knowledge-based competitive advantage companies within the Hong Kong construction and



104

Overall, the findings of this exploratory research revealed that a purposeful and strategic design

was being undertaken in the management of the inter-organisational and operational functioning

of project-based joint ventures between partner companies within the Hong Kong construction

and engineering industry. Namely, once project-based opportunities were identified, no single

contracting organisation wished to carry the entire financial risk, nor possessed sufficient

knowledge, skills, and competencies with which to undertake and complete the project alone.

Based on the findings of the present research, respondents sought to use the JV as an approach

with which to ‘harmonise’ their skills and competencies with others, that under many

circumstances, would be their competitors within the Hong Kong construction and engineering

industry. Hence, in terms of respondents’ identified attitudes towards the culture of inter-

organisational learning, such individuals reported a strong desire to use JV relationships in order

to achieve learning from each other, and this represented an important motivation with which to

develop relationships with other competitors within the Hong Kong construction and

engineering industry. In addition, the need to remediate and address identified skill gaps, and to

gain valuable insights in terms of organisational procedures and ways of working, also appeared

equally important motivating factors towards developing and establishing project-based joint

ventures with other partner companies.

Walker, Hampson, and Peters (2000) argue that relationship-based approaches between

contractual companies, in the design and building of complex and demanding construction and

engineering projects, remain integral to cost-efficiency and sustainable knowledge-based

competitive advantage within this industry. The findings of the present research strongly

indicate that respondents actively involved other partner companies in identifying and defining

shared objectives and goals in order to facilitate joint venture performance and knowledge-

based competitive advantage

See Figure 4.1 for a proposed model of inter-organisational learning motivation, where it

suggests that technological and resource-based compatibility between partner companies

represented important considerations when a project-based opportunity was identified. Through

the value of organisational knowledge-based assets, such as joint or shared learning between

partner companies, such collaborative effort was likely to minimise potential risks and

associated infrastructure costs, leading to the development and establishment of new and more

efficient ways of working or shared ‘intellectual property’. As a consequence, the value of

‘new’ organisational-based learning was in terms of how such learning could be applied to


105

future collaborative JV projects, when competing against other companies, or alternatively,

within projects where an organisational contractor sought to complete the construction and

engineering project alone

Project opportunity identified

Skills/competencies identified

Org. 1 Org. 2 Org. n+ +

JV formedleading

to

JV formedleading

to

1 - Realise project outcomes with maximum

return to JV partners

1 - Realise project outcomes with maximum

return to JV partners 2 - Realise learning from JV partners

2 - Realise learning from JV partners

$ Profits$ Profits

Reputation and brand image

Reputation and brand image

Intellectual property

Intellectual property

Better understanding of JV partners for

future JV projects

Better understanding of JV partners for

future JV projects

Learning applied to

future JVs or stand-alone

Learning applied to

future JVs or stand-alone

AndThrough Joint

Learning

AndThrough Joint

Learning

Figure 4.1: Inter-Organisational Learning Motivation in Achieving Successful JV Projects

. For example, this may have been in order to generate competitive-based profits or enhance the

reputation/brand image of their own organisational company, or alternatively, that of the partner

organisation(s) with whom they are involved, in the context of the project-based joint venture.

Furthermore, although the findings of the present research highlighted identified differences

between ‘foreign’ and ‘local’ contractors (in terms of inter-organisational culture, values,

expectations, skills, and dependencies), there tended to be a strong and committed desire

amongst participants in the JV to succeed. However, this depended upon whether the JV

alliance was short-term oriented, or alternatively, whether it could be used for more than one

project.

In addition, JV partner companies sought other benefits through their involvement in project-

based joint ventures with other organisational companies within the Hong Kong construction


106

and engineering industry. Namely, these included sustainable knowledge-based competitive

advantage, a reasonable return on their investment, as well as increased value towards their

company’s shareholders. Moreover, identifying new opportunities with potential partners,

improving the company’s technology base, strengthening their financial position, and ensuring

inter-organisational risk was adequately limited, reduced or shared appropriately, represented

other potential concerns which tended to be associated with JV involvement. All respondents,

however, agreed that ethics and governance issues, regarding the inter-organisational and

operational culture of JV’s, were significant factors in the development and nature of any inter-

organisational alliance between partner companies within the Hong Kong construction and


Additionally, the findings of the present research also revealed that inter-organisational trust

and commitment between partner companies were issues of fundamental importance within the

context of the JV relationship. Most notably, ‘equalisation’ of power between inter-

organisational companies within JV partnerships represented a significant concern in the

context of the JV between partner companies, in terms of the nature of decision-making

practices and processes in ensuring co-operative arrangements between partnered companies in

the management of disputes. Shared inter-organisational commitment to strategic goals and

objectives of the JV was also evidently important in terms of the need for partnered companies

to enhance their organisational knowledge-based learning, management expertise and market

share of clients, projects, technologies. Also this need extended to other opportunities relevant

within the Hong Kong construction and engineering industry in attaining sustainable

knowledge-based competitive advantage (which may be termed as ‘capacity building’).

It is acknowledged that the national and organisational cultural background of the respondents

may have influenced their opinions and preferences in responding to questions that were posed

by this research (Hofstede, 1980, 1991). Inter-organisational cultural ‘capability maturity’ has

been advocated as essential within contemporary and globalised business practice. These

organisations need to enhance and consolidate their value contribution and competitive position

within the business marketplace in several ways. First they can add value through their

perceived range of alternative organisational and operational culture and working practices and

procedures. Second, they also can combine the best characteristics and attributes of their

diversity by promoting inter-organisational learning between partner companies (Hampden-

Turner & Trompenaars, 2000). Hence, an understanding of the national and organisational

cultural background of personnel involved in the governance of project-based joint ventures

within the Hong Kong construction and engineering industry significantly contributes to


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meeting both client and JV partner-related needs that delivers satisfactory JV performance and

the attainment of a sustainable knowledge-based competitive advantage.

At the present stage, it remains unclear how, and in what way, inter-organisational learning

motivation may be facilitated in ensuring knowledge-based competitive advantage within the

organisational and operational culture of project-based joint ventures in the Hong Kong

construction and engineering industry. For example, as indicated by the present research

findings, there appear to be a number of identified issues which may also be important in

ensuring knowledge-based competitive advantage, and hence satisfaction with JV performance.

These are: (i) inter-organisational trust; (ii) organisational culture and commitment; (iii) style of

decision-making processes and practices in ensuring co-operative arrangements between partner

companies; as well as (iv) demonstrated commitment by partner companies towards the

successful attainment of the shared (or strategic) objectives and goals of the JV. Hence, in part,

the purpose of Study Two will be to develop relevant instruments to assess such variables and

examine the relationship between the inter-organisational and operational culture of project-

based joint ventures in facilitating sustainable knowledge-based competitive advantage within

the Hong Kong construction and engineering industry.

In order to investigate and explore in more detail some of the issues, which were raised by this

exploratory research, further research was undertaken in Study Two. This study used a larger

sample of project team participants (n = 40) from a range of management levels involved in the

governance of project-based joint ventures within the Hong Kong construction and engineering

industry. As this initial exploratory research was largely descriptive and qualitative, findings of

Study One were used in combination with the relevant research literature to develop reliable and

valid instrumentation in Study Two.

4.5. Chapter Summary

In this chapter, the nature, rationale, and significance of the type of qualitative methodology

used in this exploratory research were discussed. The sampling, methodology, and findings of

the research in Study One were then detailed. Namely, senior executives’ understanding of the

organisational and operational culture and functioning of project-based joint ventures, in

facilitating knowledge-based competitive advantage between partner companies within the

Hong Kong construction industry, was investigated and explored.

Based on the findings of this initial research, the implications in terms of the methodology and

subsequent research design for Study Two, Chapter Four are discussed.

CHAPTER FIVE

STUDY TWO: DEVELOPMENT, EVALUATION AND VALIDATION OF THE

STRATEGIC ALLIANCE CONTRACTING INVENTORY (SACI)

This chapter describes the purpose, objectives, and research design of Study Two. It also

presents findings and results are analysed and the significance of these discussed. The purpose

of Study Two was to build upon findings from Study One and to develop and examine the

reliability and validity of the Strategic Alliance Contracting Inventory (SACI) research

instrument.

This SACI instrument was administered to a representative sample of 40 respondents and

relevant data was gathered on culturally relevant facilitators and inhibitors to collaborative-

based practices that are hypothesised to impact joint venture performance and satisfaction

within the Hong Kong construction industry.

Figure 5.1 explains the validation process of this research. The investigator’s extensive industry

experience, feedback from senior management industry colleagues and a critical review of the

relevant research literature and results from Study 1 shaped the research approach undertaken

in Study Two. Study One provided an exploratory investigation that was based on structured

and focused interviews with nine senior executives of multinational corporations directly

involved in major Hong Kong construction and engineering infrastructure projects.

This indicated the importance of strategic alliance and partnership arrangements and the role of

organisational and national culture as a critical factor contributing to satisfaction of a JV and its

probably perceived success. Study One together with feedback received from industry peers

was important in the development of hypothesised factors affecting performance of JVs.

It also helped shape the strategy for the Study Two research design and the analysis of its data

as well as providing insights that could be validated by a broader sample of project participants

than Study One’s limited but expert field of interviewees.

Chapter Five: Study Two

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(i) Portfolio of Hypothesized Factors Affecting Performance of Joint Ventures

(ii) Research Questions One to Nine

Figure 5.1: Process of Validation of the Research Design of the Doctoral Thesis.

This chapter also describes the research method, sample strategy, data analysis and collection

procedures undertaken (see Appendix A for a detailed explanation of statistical analytic terms

and procedures as used within this chapter). Statistical procedures used to analyse the resultant

data are also discussed together with the pertinent findings. The implications of these results

and their conclusions are then given.

• Researcher’s Career • Researcher’s Objective

Experience of the Hong Kong Construction Industry

• Colleagues’ & Associates’ Feedback on Project-Based Construction Infrastructure Joint Ventures in Hong Kong

• Critical Review of Relevant Research Literature on Joint Ventures

Methodology &Results of Study One

Discussion of the Findings of Study One: Implications for Study Two

Methodology & Results of Study Two

Discussion of the Findings of Study Two: Implications for Understanding Project-Based

Construction Joint Ventures

Justification of the Methodological Research Design


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The hypotheses developed in this research are based upon an understanding of collaborative-

based practice within the Hong Kong construction and engineering industry and the concept of

sustainable competitive advantage. Also in this context organisational/national culture had to be

considered and examined, thus providing a structure that links Studies One with Two. Study

One findings suggest that the organisational culture of participating companies was defined in

terms of their shared values that underlie and determine work-related behaviours of staff when

applying rules and procedures to solve problems and work towards solutions.

Aspects of organisational culture that were assessed included: identifying what project-based

joint venture partners wanted (i.e., expansion, maintenance, synergy); (ii) identifying

vulnerability/risk factors and trust/commitment concerns; and (iii) the manner in which they

planned to achieve their aims in order to achieve the objectives which satisfied their clients’

project-related needs i.e., organisational and operational focus.

Study One respondents affirmed that partnering companies engaged in project-based joint

ventures and sought to ‘harmonise’ their organisational knowledge, skills, and technological-

based competencies. This was undertaken so that companies could enhance and consolidate

their competitive position within the marketplace through organisational learning, thus attaining

sustainable competitive advantage. Study One findings confirm that companies collaboratively

seek to ‘bridge’ acknowledged gaps, specifically in terms of their perceived capacity to provide

goods and/or services to secure and establish mutual competitive advantage (Bowman, Singh,

& Thomas, 2002; Cool, Costa, & Dierickx, 2002).

Study Two hypotheses were framed using the analysis of qualitative interview-based data from

Study One that provided an in-depth understanding of the organisational culture of project-

based joint ventures within the Hong Kong construction and engineering industry. Study Two

hypotheses required quantitative research to be undertaken to further explore and investigate in

greater detail the organisational culture of project-based joint ventures within the Hong Kong

construction and engineering industry. The research approach taken was two-fold. First, based

on the findings of Study One, in combination with the relevant research literature, an 89-item

‘Strategic Alliance Contracting Inventory’ (SACI) was constructed, developed, and then

validated. Specifically, the SACI was designed to include reliable and content valid measures.

These were defined as project-based joint venture organisational culture ‘indices’ and included

the following issues; Satisfaction with Joint Venture Performance, Cultural Divergence,

Competitive Advantage, Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-

Parent Cooperation, Commitment to the Joint Venture and Organisational Commitment issues.


111

Study Two’s methodological design also investigated whether national and/or organisational

culture was adequately controlled for when acknowledging reported differences in respondents’

self-reports and how this impacted organisational and/or national cultural differences.

5.1. Method.

5.1.1. Instrument Development Procedures

A representative series of questions were developed from the relevant literature relating to joint

ventures and/or strategic alliances to gather relevant data. Specifically, question items were

selectively drawn to measure a number of characteristics of the examined JVs. These included

alliance age, competitiveness, experience, performance and satisfaction, JV organisational

cohesiveness and commitment, task interdependence, inter-parent cooperation, inter-

organisational trust, as well as cultural and strategic fit.

These question items were drawn from the literature (i.e., Johnson, Korsgaard & Sapienza,

2002; Lasserre, 1999; Luo, 2002a, 2002b; Mowday, Porter & Steers, 1992; Pierce, 2001).

Moreover, to minimise response bias, items were randomly ordered, where appropriate, of

which 20 of the 89-items constituting the ‘Strategic Alliance Contracting Inventory’ (SACI)

were reverse-scored (refer to details as described below pertaining to each construct). Further,

to maintain uniformity and consistency across items, respondents were instructed to indicate

their extent of agreement or disagreement with each statement on a six-point Likert-type scale

(i.e., ‘1’ = “Strongly Agree” to ‘6’ = “Strongly Disagree”) over the previous 24 months.

Specifically, a 24-month time duration was used to ensure that an adequate and representative

sampling of self-reports relating to the cultural facilitators and inhibitors of joint venture

performance were accessed within the methodological context of the present study. A

description of each theoretical construct (i.e., Satisfaction with Joint Venture Performance,

Cultural Divergence, Competitive Advantage, Inter-Organisational Trust, Strategic Fit,

Decision Control, Inter-Parent Cooperation, Commitment to Joint Venture, Organisational

Commitment), as included within the ‘Strategic Alliance Contracting Inventory’ (SACI), is

provided below.

5.1.1.1. Satisfaction with Joint Venture Performance (9 items).

In Study One, respondents highlighted the importance of such key and functional aspects as

knowledge-based management practices and inter-organisational learning. Subsequently,


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therefore, it appears that perceived satisfaction with the operational functioning of joint venture

remains paramount to enabling and facilitating collaborative-based practices between partner

companies involved in strategic alliances within the context of the construction industry of

Hong Kong.

Subsequently, therefore, Satisfaction with Joint Venture Performance was assessed and

measured, as based on nine items with satisfactory content validity. Specifically, three items

[i.e., refer to Items 7, 15 (reverse-scored) and 29 (reverse-scored) of the SACI; see Appendix D

] were selectively drawn from the 5-item ‘Perceived Satisfaction by Western Manager’ scale, as

developed by Lasserre (1999) through principal components factor analysis, through trialing

which was based on a sample of 124 Western managers working in managerial-based positions

within the context of multinational and collaborative-based joint ventures in the Asia-Pacific

region. Validation of the 5-item ‘Perceived Satisfaction by Western Manager’ scale

demonstrates this measure to evidence satisfactory construct validity, as based on Varimax-

rotated factor loadings (i.e., 0.65 to 0.76) (Lasserre, 1999).

Moreover, for the specific purposes of Study Two, six additional items were also used to

measure Satisfaction with Joint Venture Performance [ i.e., refer to Items 34, 35, 43, 51, 55 and

56 of the SACI; see Appendix D ], as based on the following content domains characteristic

and descriptive of the construct of Satisfaction with Joint Venture Performance: commitment,

decision-making practices, progress towards long-term goals in joint ventures, and rewards and

benefits associated with invested partnerships (e.g., Buckley, Glaister & Husan, 2002; Shenhar,

Dvir, Levy & Maltz, 2002).

5.1.1.2. Cultural Divergence (10 items).

As cited within the relevant research literature and supported by the findings of Study One,

cultural differences among and between differing organisations involved in strategic alliances

or partnerships may serve to either facilitate and/or inhibit project performance, productivity

and hence success (e.g., Bruton & Ahlstrom, 2003; Clugston, Howell & Dorfman, 2000).

Hence, ten items were used to assess and measure the construct of Cultural Divergence [ i.e.,

Items 2, 8, 13, 17, 27, 39, 40 (reverse-scored), 60 (reverse-scored), 64, 66 of the SACI; see

Appendix D], of which three items (i.e., Items 2, 8, 13 and 27 of the SACI) were selectively

drawn from the 5-item ‘Cultural Divergence’ scale developed and validated by Lasserre (1999),

who found this scale to demonstrate adequate and acceptable content validity as evidenced by

reported Varimax-rotated factor loadings (i.e., 0.68 to 0.78). Moreover, based on the relevant

literature regarding cultural divergence, for the purposes of this research, an additional six


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items (i.e., Items 17, 39, 40, 60, 64, and 66 of the SACI were further developed with which to

assess characteristic aspects of Cultural Divergence, as applicable to cross-cultural differences

in knowledge-based and decision-making management-practices within project-based joint

ventures in the Hong Kong construction industry.

5.1.1.3. Competitive Advantage (6 items).

Consistent with the results of Study One, competitive advantage was identified as an essential

and disseminated strategic goal orientation within the context of negotiated partnerships

between multinational corporations in the construction industry of Hong Kong. Hence, in order

to adequately assess the construct of Competitive Advantage [ i.e., refer to Items 4, 12, 24, 67,

68, 69 of the SACI; see Appendix D ], whereas Items 12 and 24 were drawn from the 2-item

factor labelled ‘Competitive Obligation’ (Individual factor loadings – 0.89), and Item 4 from

the 2-item factor labelled ‘Experience with Joint Ventures in Asia’ (Individual factor loadings –

0.77), as developed, trialled and validated by Lasserre (1999), Items 67, 68 and 69 were

specifically developed for the purposes of the present research as informed by the relevant

research literature concerning facilitating competitive advantage joint ventures (i.e., Black,

Akintoye & Fitzgerald, 2000; Holt, Love & Li, 2000; Tsang, 2002). Thus, all six items

possessed adequate content and construct validity with which to adequately and

representatively measure ‘Competitive Advantage’.

5.1.1.4. Inter-Organisational Trust (9 items).

In Study One, such characteristic attributes as trust and commitment were raised by

respondents as being important in affecting knowledge-based managerial practice and

subsequent joint venture performance. Hence, as supported by the relevant literature, the

construct of Inter-Organisational Trust [i.e., Items 6, 11, 14, 16 (reverse-scored), 20, 38, 53, 61,

65 of the SACI; see Appendix D] was assessed based on six items (i.e., Items 14, 16, 20, 38,

53, 65) which were adaptively selected from the 9-item scale of ‘Interorganisational Trust’ as

developed by Luo (2002a). Accordingly, it has been reported that the demonstrated to evidence

high reliability (Cronbach’s Alpha = 0.79) as well as convergent and construct validity, as

reflective of the Varimax-rotated communality estimates greater than or equal to 0.75.

Furthermore, for the specific purposes of this research, three additional items were developed

with which to also assess reciprocal commitment within the context of adequately measuring

Inter-Organisational trust, as applicable to project-based joint ventures in the Hong Kong

construction industry.


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5.1.1.5. Strategic Fit (18 items).

To ensure adequate, appropriate and representative content validity, all Strategic Fit items

[i.e., Items 3, 9, 10 (reverse-scored), 21 (reverse-scored), 22, 23, 25 (reverse-scored), 28, 30

(reverse-scored), 32, 36, 41, 42 (reverse-scored), 47, 49 (reverse-scored), 50, 52 (reverse-

scored), 59 of the SACI; see Appendix D] were collectively drawn from both the findings of

Study One in combination with that of the relevant literature. For example, in Study One,

respondents stated that inter-organisational complementarity, capacity building (i.e., access to

expanded profits, market share, opportunities, management expertise, knowledge regarding

clients, projects or new and diverse technologies), and capability maturity (i.e., trust and

commitment) were important considerations with regard to the subsequent assessment of joint

venture functioning and performance.

Hence, of the 18 items, the following content domains reflective of characterising qualitative

aspects of Strategic Fit were assessed: inter-organisational cohesiveness (i.e., Items 36, 41, 42,

49, 52), competitive short-term/long-term goal orientation of partners involved in the alliance

(i.e., Items 10, 21, 25), task interdependence (i.e., Item 3), decision-making practices (i.e.,

Items 22, 30), committed and purposeful inter-organisational relationships (i.e., Items 9, 28, 32,

47, 59), and pre-existing and prior of experience with joint ventures (i.e., Items 23, 50), where

it has been reported within the relevant literature that such items demonstrate and evidence

satisfactory estimates of content validity and reliability (i.e., internal consistency, test-retest)

(i.e., Lasserre, 1999; Pearce, 2001).

5.1.1.6. Decision Control (3 items).

As indicated in Study One, results suggested that contractual design in the development and

implementation of project-based joint ventures in regulating the rights, responsibilities and

benefits associated with inter-firm partnering was essential in order to facilitate project

success. Consequently, the construct of Decision Control was thus assessed in the present

research as based on the one and two item respectively chosen from the ‘Decision Control’ [

i.e., refer to Item 5 of the SACI; see Appendix D ] and ‘Procedural Justice’ scales [ i.e., refer to

Items 46, 54 of the SACI; see Appendix D ], as developed by Johnson, Korsgaard and Sapienza

(2002) and adapted for the present research in the context of investigating the nature of joint

venture functioning between multinational corporations in the Hong Kong construction

industry. Accordingly, it is has been reported by Johnson, Korsgaard and Sapienza (2002) that

that the ‘Decision Control’ and ‘Procedural Justice’ scales from which these three items were

drawn possess a high level of reliability (i.e., Cronbach’s Alpha = 0.83 and 0.91, respectively)

and construct validity.


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5.1.1.7. Inter-Parent Cooperation (12 items).

According to the findings of Study One, the cooperative interchange and transfer of

technological and resource-based knowledge, skills and expertise within the context of

organisational learning practices in joint ventures was identified as an important element

regarding achieving collaborative practice between partners in the achievement of sustained

competitive advantage.

Hence, based on the 9-item ‘Inter-Parent Cooperation’ scale developed by Pearce (2001), in

critical regard to Heide and Miner’s (1992) research concerning cooperation in the context of

relational exchange, the construct of Inter-Parent Cooperation was assessed in the present

research utilising seven of these 9 items [i.e., refer to Items 18, 19, 26, 31, 33, 37, 44 of the

SACI; see Appendix D], in addition to five other items [ i.e., refer to Items 45, 48, 62, 63 of the

SACI; see Appendix D ] which were specifically developed for the purposes of the present

research as informed by the relevant literature with regard to project-based joint ventures (i.e.,

Luo, 2002b, Luo & Shenkar, 2002). Subsequently, of the 9 items which were developed by

Pearce (2001), it is reported that such items demonstrate satisfactory estimates of internal

consistency (i.e., above 0.70) and purported discriminant and construct validity, as based on the

results of principal components factor analysis.

Of the 12 items in total, therefore, which were used to measure the construct of Inter-Parent

Cooperation [ i.e., refer to Items 1, 18, 19, 26, 31, 33, 37, 44, 45, 48, 62, 63 of the SACI; see

Appendix D ], the content domain of such items was reflective of such aspects as flexibility

(i.e., Items 1, 37, 44, 48, 62), information exchange (i.e., Items 19, 31, 45, 63) and shared

problem solving (i.e., Items 18, 26, 33).

5.1.1.8. Commitment to Joint Venture (6 items).

The utilisation and selection of items [ i.e., Items 71 (reverse-scored), 72, 73 (reverse-scored),

74 (reverse-scored), 75 of the SACI; refer to Appendix D ] with which to assess joint venture

commitment was primarily motivated by the findings of Study One in conjunction with the

relevant literature concerning the importance of inter-organisational compatibility, in terms of

knowledge-based management and organisational learning practices. Specifically, the six items

used to measure Commitment to Joint Venture were selected using the 6-item ‘Commitment to

the International Joint Venture’ scale, which has been demonstrated to possess satisfactory

content and divergent validity together with that of reliability (i.e., Cronbach’s Alpha = 0.81 to


116

0.98), as based upon a sample of 54 international joint ventures representing a range of

industries (e.g., automotive, metals, aerospace) (Johnson, Korsgaard & Sapienza, 2002).

5.1.1.9. Organisational Commitment (16 items).

Of the 16 items used to measure Organisational Commitment [ i.e., Items 57, 58, 76, 77, 78

(reverse-scored), 79, 80, 81 (reverse-scored), 82, 83, 84, 85 (reverse-scored), 86, 87 (reverse-

scored), 88, 89 (reverse-scored) of the SACI; see Appendix D ], 14 of the 16 items were

selected from the Organisational Commitment Questionnaire (OCQ), as developed and

psychometrically validated by Mowday, Porter and Steers (1982), based on a range of varying

and diverse samples of participants in a variety of jobs within both private and public

organisations.

Subsequently, the 14-item OCQ has frequently been utilized in various research investigations

in order to examine the nature and significance of salient interrelationships between various

indices of perceived organisational commitment and functioning (Rhoades & Eisenberger,

2002). The OCQ consists of items which focus on employee-related commitment towards

regulating and facilitating the operational functioning of organisations (Mowday, Porter &

Steers, 1982). In investigations which have been conducted using the OCQ, estimates of

Cronbach’s Alpha tend to remain uniformly high (i.e., 0.80 or above) and the OCQ has been

demonstrated to evidence satisfactory test-retest reliability together with convergent,

discriminant and predictive validity. In addition, for the specific purposes of the present

research, as based on the relevant literature relating to perceived organisational commitment

(e.g., Eisenberger, Armeli, Rexwinkel, Lynch & Rhoades, 2001; Eisenberger, Huntington,

Hutchison & Sowa, 1986; Turban, Lau, Ngo, Chow & Si, 2001), two additional items (i.e.,

Items 57 and 58; refer to Appendix D) were also included in order to ascertain such

organisational commitment attributes as scaling of operational joint ventures together with that

of organisational trust.

5.1.2. Sample Size and Characteristics.

Participants included 40 respondents (38 males, 2 females) aged from 25 to 68 years (Mean =

46.32 ± 1.60 years; SD = 10.12 years; Median = 46.50 years) who were selectively drawn from

their separate involvement within four differing types of project-based construction joint

ventures in Hong Kong. Of the 40 respondents who elected to participate, such individuals

represented the total number of personnel within the top tier of management across the four

differing types of joint ventures, who were available at the time with which to cooperate and

partake within this research. Furthermore, of the four project-based construction joint ventures


117

which were sampled [ i.e., Terminal 8; n = 3 (7.5%); Route 3: n = 13 (32.5%); MTRC: n = 12

(30%); and East Rail: n = 12 (30%); see Appendix E for a detailed description concerning the

characteristics of each Type of Joint Venture ], these represented the only four projects

presently being undertaken within the context of the Hong Kong construction industry at the

time of the data gathering phase of this research.

Of particular note, however, differences in the number (or frequency) of participants sampled

within the differing project-based construction joint ventures were primarily due to the

geographical redeployment and transfer of relevant managerial and administrative personnel

outside Hong Kong, thereby accounting for the limited number (or frequency) of participants

sampled from within the ‘Terminal 8’ project-based construction joint venture.

Moreover, individual differences in the frequency counts of individuals who were sampled

from either Route 3 (i.e., n = 13), MTRC (i.e., n = 12) and East Rail (i.e., n = 12) were due to

the presence of differing support staff members (i.e., administrative, engineers/surveyors,

managerial) individually assigned and involved in the governance of each of the three types of

project-based joint ventures.

Of the 40 participants sampled from the Terminal 8, Route 3, MTRC, and East Rail project-

based joint ventures, the overall duration of job tenure of individuals varied from 4 to 216

months (Mean = 67.59 ± 8.94 months; SD = 56.55 months; Median = 48.00 months).

Furthermore, with regard to their allocated and assigned responsibilities, 16 (i.e., 40%) were

involved in; managerial roles (i.e., Deputy Administrative, Construction,

General/Project/Quality & Environmental Manager), 13 (i.e., 32.5%) as Directors or Chief

Executive Officers (CEO’s) (i.e., Chief Executive Officer, Commercial / Construction/

Executive/ Managing Director), nine (i.e., 22.5%) as Engineers or Surveyors (i.e., E &

M/Senior Project Engineer, Assistant/Site Quantity Surveyor), and two (i.e., 5%) within

Administrative-related roles (i.e., Contract Administrator or Group Solicitor/Company

Secretary).

Educational attainment levels of respondents were as follows: High School Degree/Diploma or

Less (n = 2; 5.0%); Some College Education (n = 4; 10.0%); Bachelor’s Degree (n = 12;

30.0%); Some Graduate Education (n = 2; 5.0%); Graduate Degree (n = 17; 42.5%); and Other

Not Specified (n = 3; 7.5%).


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In terms of the participants’ involvement within the varying types of joint ventures, such level

of participation included: Onsite Project Management (n = 23; 57.5%), Head Office (n = 16;

40.0%), and Other Not Specified (n = 1; 2.5%).

Moreover, of the foreign partners (i.e., Japan, China, Britain,. France, Other Not Specified) of

which multinational corporations had established joint ventures or strategic alliances with, the

frequencies (and corresponding percentage) of companies who were involved in relationships

with one or less, two, three, or alternatively four or more partners comprised 13 (32.5%), 12

(30.0%), 10 (25.0%), and 5 (12.5%), respectively. In addition, the periodic duration of such

alliances with foreign partners ranged from 2 to 50 years (Mean = 17.24 ± 1.74 years; SD =

10.56 years; Median = 20.00 years).

A more detailed description of the sample characteristics of participants, according to the four

differing types of project-based joint venture construction projects, is provided in Table 5.1. As

shown in Table 5.1, with the exception of the contract value associated within each of the four

differing types of project-based construction joint ventures (i.e., Terminal 8, Route 3, MTRC,

East Rail), the characteristic attributes of respondents appeared relatively similar in terms of

Gender, Age, Level of Educational Attainment, Proportionate Foreign Partner involvement,

Length and Type of Job Tenure as well as Respondent’s Relational Status (i.e., Head Office,

Onsite) within the context of the construction joint venture.

Table 5.1 did not include reference to each participant’s nationality; however their nationality is

detailed in Appendix D. Further research is necessary to examine the impact of the individuals,

some of whom were not of the same origin of the national, either foreign or local companies

they represented and worked for, that participated in this research.


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Table 5.1: Sample Characteristics of Project-Based Construction Joint Ventures. Type of Project-based Joint Venture

Characteristics of Respondents &

Project-Based Joint Venture

Terminal 8 (n = 3)

Route 3 (n = 13)

MTRC (n = 12)

East Rail (n = 12)

1. Respondent’s Gender Male = 3 Male = 12; Female = 1 Male = 12 Male =11; Female = 1 2. Respondent’s Age (Years)

Mean = 54.67 years SD = 11.02 years Range = 42 to 62 years




3. Respondent’s Level of Educational Attainment

Some College Education = 1Bachelor’s Degree = 1 Other = 1

High School Degree/Diploma = 1 Some College Education = 1 Bachelor’s Degree = 3 Some Graduate Education = 1 Graduate Degree = 6 Other = 1

High School Degree/Diploma = 1 Some College Education = 3Bachelor’s Degree = 7 Other = 1

Some College Education = 2 Bachelor’s Degree = 5 Some Graduate Education = 1 Graduate Degree = 4

4. Financial Investment Cost of Joint Venture

US$ 400 million US$ 1 billion US$ 100 million US$ 50 million

5. Type of Foreign Partners Involved in Joint Venture & Proportionate Representation

N = 1 to 3 partner co’s (i.e., Japan = 37.5%, China = 37.5%, French = 12.5%, Others = 12.5%)

N = 1 to 4 partner companies (i.e., Japan = 40.0%, China = 12.0%, Britain = 12.0%, French = 32.0%, Others = 4.0%)



6. Extant History of Involvement with Foreign Partners





7. Type of Respondent’s Job Tenure

Managerial = 2 Engineers/Surveyors = 1

Administrative = 1 Managerial = 6 Engineers/Surveyors = 1 Executive/CEO’s = 5

Managerial = 3 Engineers/Surveyors = 7 Executive/CEO’s = 2

Administrative = 1 Managerial = 4 Executive/CEO’s = 7

8. Length of Respondent’s Job Tenure (Years)




Mean = 6.36 years SD = 5.27 years Range=4 months to 18 years

9. Nature of Respondent’s Relational Status Within Project-Based Joint Venture

Head Office = 0 Onsite Project Management = 3



Head Office = 7 Onsite Project Management = 4 Other = 1


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5.1.3. Procedure.

All participants were accessed and subsequently administered the SACI between December 3, 2002

and March 7, 2003 through initial contact which was made by the researcher towards professionals,

colleagues and personal associates either through email (n = 15; 37.5), letter (n = 3; 7.5%) or private

solicited contacts (n = 22; 55.0%) at which time the nature and the purpose of the research was

explained to respondents.

Subsequently, upon the receipt of informed consent and assurances that respondents were free to

decline at any stage without prejudice, all participatory construction, executive and managerial

personnel completed the Strategic Alliance Contracting Inventory (SACI). In administering the

SACI, confidentiality was emphasised both verbally and on the cover page of the questionnaire and

those individuals would not be identified in any way as only group responses would be used.

In terms of the mode of questionnaire administration used (i.e., email, letter, private solicited

contacts), One-way Multivariate Analysis of Variance failed to reveal that there were discernible

nor salient mean-related significant differences in self-reports between those who completed the

SACI either by email, letter or through private solicited contacts, F (df = 18, 60) = 1.22, p > 0.05;

Pillai’s Trace criterion = 0.537 [ refer to justification of the use of Pillai’s Trace criterion in

determining multivariate significance as detailed within Section 5.1.5; Note: ‘One-way’ means an

analysis based on one independent variable (e.g., Type of Enquiry (3 levels) – Email, Letter, Private

Solicited Contacts) ].


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5.1.4. Research Questions Leading to Hypotheses.

A summary of the pertinent nine research questions are listed at the close of Chapter Two:

• Are there Group-related differences in project-based joint ventures according to Satisfaction

with Joint Venture Performance, Cultural Divergence, Competitive Advantage, Inter-

Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation, Commitment to

Joint Venture, Organisational Commitment?

• What is the nature of the relationship between self-reports?

• Does Cultural Divergence and Commitment to Joint Venture account more strongly for

differences in Satisfaction with Joint Venture Performance?

Such questions, as detailed above, lead to the following four subsequent research hypotheses as

given below:

5.1.4.1. Hypothesis One.

Respondents’ self-reports of Satisfaction with Joint Venture Performance, Cultural Divergence,

Competitive Advantage, Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-Parent

Cooperation, Commitment to Joint Venture, Organisational Commitment will be significantly

interrelated.

5.1.4.2. Hypothesis Two.

Differences in respondents’ self-reports will be influenced according to Type of Joint Venture and

Relational Status (i.e., Head Office, Onsite Project Management).


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5.1.4.3. Hypothesis Three.

Cultural Divergence and Commitment to Joint Venture will make significant unique contributions

in differentiating levels of Satisfaction with Joint Venture Performance, relative to Competitive

Advantage, Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation and

Organisational Commitment.

5.1.4.4. Hypothesis Four.

The interaction of Cultural Divergence and Commitment to Joint Venture will significantly

influence levels of Satisfaction with Joint Venture Performance.

5.1.5. Overview and Detailed Justification of Statistical and Item Analysis Conducted.

All raw data (as reproduced in Appendices F and G), including the internal consistency (Cronbach’s

Alpha) of the nine self-report measures (refer to Subsections 5.1.1.1 to 5.1.1.9), were analysed with

the Statview statistical package (Version 5.0.1; Statistical Analysis System Institute Inc., 1992 –

1998), and the Statistical Package for the Social Sciences (SPSS, Version 6.1.1; SPSS, Inc., 1989 –

1995).

Further, where appropriate, raw statistical output as relating to multivariate analyses of variance (see

Subsection 5.1.5.6) and regression analyses (see Subsection 5.1.5.8), which were performed, are

reproduced in Appendix H. Subsequently, Subsections 5.1.5.1 to 5.1.5.8, which follow, provide a

detailed explanation and justification of the differing statistical and item-analytic terms and

procedures which were used in order to analyse the relevant data which was obtained in Study Two.


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5.1.5.1. Understanding the Statistical Significance of Analyses Conducted Implications for

Type I and Type II Errors.

The significance of all statistical analyses (i.e., Bivariate Pearson product-moment correlations,

Univariate and multivariate analyses of variance, Multiple and hierarchical regression analyses)

were computed using a 5% level of significance (i.e., 0.05) to minimize against the possibility of

experiment wise Type I errors (i.e., rejecting the research hypothesis when it is true, of which the

probability or “α” of committing a Type I error is equivalent to the nominated significance level

which is usually between 1% and 10%) (Hinkle, Wiersma & Jurs, 1988). A significance level of 5%

refers to the accuracy of results having a 5% or less chance of being incorrect (Keller, Warrack &

Bartel, 1994). Hence, a 5% level of significance rather than 1% or 10% was conservatively used in

order to guard against experiment wise Type I as well as Type II errors (i.e., not rejecting the

research hypothesis when it is false; the probability of committing a Type II error being defined as

“1 - α”) (Shavelson, 1996).

5.1.5.2. Computation of Estimates of Internal Consistency (i.e., Cronbach’s Alpha).

Internal consistency (Cronbach’s Alpha) is defined as a measure of the reliability of a particular

theoretical construct (Kaplan & Saccuzzo, 1997). Although high internal consistency indices of 0.80

or higher are generally indicative of satisfactory instrumentation properties of a developed scale,

Shevlin, Miles, Davies and Walker (2000) state that a high estimate of coefficient alpha may be

potentially misleading. Caution must therefore be exercised in interpreting coefficient alpha as

systematic error (i.e., a consistent and reliable component of the construct being measured) may

artificially inflate coefficient alpha, even in the absence of a significant sample size effect, and

therefore not reflect the actual construct being measured (Shevlin et al., 2000).

Internal consistency, however, does not necessarily imply item homogeneity nor multi-dimensional

(i.e., existence of an underlying latent construct) (Cortina, 1993; Hattie, 1985). Furthermore,


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coefficient alpha is not necessarily an adequate measure of item homogeneity (Green, Lissitz, &

Muliak, 1977). Although Ray (1988) recommends the internal consistency of a scale should be

maximized, Kline (1986) suggests that instruments with very high item homogeneity (i.e.,

coefficient alpha greater than 0.70) are likely to be “too narrow” and “too specific”. Although these

instruments are likely to have high internal consistency, they are also likely to have low validity

(Kline, 1986).

Furthermore, Allen and Potkay (1983) state instruments with high item homogeneity may also

demonstrate low test-retest reliability. In order for any instrument to broadly measure some

construct, therefore, Boyle (1991) necessitates that item heterogeneity or diversity (i.e., moderate to

low item homogeneity) rather than item redundancy (i.e., items being essentially repetitions or

paraphrases of each other) best maximize test reliability and validity. In this research, therefore,

item content selected for inclusion within the developed nine dependent measures appears to be

sufficiently diverse in order to justify the utilization of each scale as a representative, reliable and

valid indicator of each construct.

5.1.5.3. Computation of Item Discrimination Indices (i.e., Phi).

In addition to assessment of the internal consistency of the nine dependent measures (i.e.,

Satisfaction with Joint Venture Performance, Cultural Divergence, Competitive Advantage, Inter-

Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation, Commitment to

Joint Venture, Organisational Commitment), item discrimination indices (Phi) were computed to

examine how well each item distinguished between respondents who reported either low or high

scores on each of the nine measures.

Although item analysis procedures, as based on the Phi coefficient, are not analogous to

determining item validity (Mehrens & Lehmann, 1991), such data were important in discerning the


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effectiveness of items in differentiating individual differences, thereby adding to the construct

validation of test scores. Namely, based upon an internal criterion (the total test score), item analysis

data only aided in revealing the extent to which each item positively or negatively contributed to the

total score on that scale (i.e., item discrimination).

The Phi coefficient is a special case of the Pearson product-moment coefficient (or r) in which both

variables are nominal and dichotomous (e.g., Gender, Respondent’s Relational status – Head Office

or Onsite). Subsequently, in the computation of the Phi coefficient, which may vary in magnitude

from maximum values of –1.0 to +1.0 (Payne, 1992), data were arranged into a 2 x 2 contingency

table in which the procedure for computing Phi is detailed in Table 5.2.

Table 5.2: 2 x 2 Contingency Table for Computing the Phi Coefficient.

Variable X

Totals

A B A + B

Variable Y

C D C + D

Totals A + C B + D N

(BC – AD)

Phi = √ (A + B) (C + D) (A + C) (B + D)

In the present research, therefore, the Phi coefficient was used to calculate item discrimination by

dichotomizing both item response (i.e., Item score of ‘1’, ‘2’ or ‘3’ classified as “0”; Item score of

‘4’, ‘5’ or ‘6’ classified as “1”) and total score (i.e., Below median = “0”; Above median = “1”) on

each dependent measure. According to Hopkins, Stanley and Hopkins (1990), items with


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discrimination indices 0.40 or greater reflect very good items, 0.20 to 0.40 satisfactory, 0.10 to 0.19

marginal, and below 0.10, reflect items that either need to be rejected or revised. The closer the

value of this index is to 1.0, the better the item (Kaplan & Saccuzzo, 1997). Ideally, item

discrimination indices should be moderately positive and similar. Negative discrimination indices

are indicative of problematic items because respondents who highly endorse these items (i.e., Item

score of ‘4’, ‘5’ or ‘6’) will have a lower total score on that measure, relative to those individuals

who do not (i.e., Item score of ‘4’, ‘5’ or ‘6’).

5.1.5.4. Bivariate Pearson Product-Moment Correlation Coefficients.

Bivariate Pearson product-moment correlation coefficients (i.e., Pearson r) were calculated to

examine the strength and significance of interrelationships between independent (i.e., Age of the

Alliance, Number of Inter-Companies Partnerships) and associated dependent variables. Such

Bivariate Pearson product-moment correlations were important in the examination of associative

inter-relationships between salient independent and dependent variables within this research in

exploring and understanding the dynamics and nature of collaborative-based practices between

multinational organisations actively engaged in construction project-based joint ventures within

Hong Kong.

5.1.5.5. Appropriateness of Factor Analysis Procedures.

As dependent variables, which were being measured in this research, were considered highly

representative of predefined content domains (refer to ‘Instrument Development Procedures’

Subsections 5.1.1.1 to 5.1.1.9), principal-components factor analysis procedures (either with or

without varimax rotation, dependent on the interpretability of extracted factors) were not used nor

deemed appropriate within this context. Namely, factor analysis reductionist procedures require a

minimum sample size of between 100 to 200 participants to be attained with at least 5 cases for each

observed variable, in order to be able to express some degree of purported confidence in the

reliability and interpretability of extracted factors (Tabachnick & Fidell, 1989).


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5.1.5.6. Multivariate/Univariate Analyses of Variance and Post-hoc Tukey HSD Pairwise

Comparisons.

To discern whether there were significant Group-related differences in self-reports according to

Type of Joint Venture and Respondent’s Relational Status, Multivariate Analysis of Variance

(MANOVA) was performed. Due to the presence of multiple dependent variables, MANOVA was

justifiably used above doing individual ANOVAs as the former statistical procedure has the

advantage of protecting against the possibility of inflated Type I errors due to multiple tests of

(correlated) dependent variables and in being able to powerfully detect significance not otherwise

shown in separate ANOVAs (Tabachnick & Fidell, 1989).

However, two separate One-way Multivariate (i.e., based on multiple dependent variables) Analyses

of Variance (MANOVA) were performed in order to determine Group-related differences in self-

reports according to Type of Joint Venture and Respondent’s Relational Status [Note: ‘One-way’

means an analysis based on one dependent and one independent variable, of which the latter may

have a number of levels e.g., Type of Joint Venture (4 levels)]. For each MANOVA conducted, as

the frequency counts of two of the resultant individual cell sizes for Type of Joint Venture [ 4

levels; i.e., Terminal 8; n = 3; Route 3: n = 13; MTRC: n = 12; and East Rail: n = 12 ] and

Respondent’s Relational Status [ 3 levels; i.e., Onsite Project Management, n = 23; Head Office, n =

16; Other Not Specified, n = 1 ] were less than 10, each analysis was considered in a different way.

Namely, the former One-way MANOVA was based on four levels of ‘Type of Joint Venture’ due to

the need to preserve available data pertaining to Type of Joint Venture, and more so, due to the

relative robustness of this statistical procedure when there exists unequal and small cell sizes

(Tabachnick & Fidell, 1989). The latter One-way MANOVA involving Respondent’s ‘Relational

Status’, however, was only based on two levels (i.e., Head Office, Onsite). Thus, a Two-way Type

of Joint Venture (as based on 4 Levels) x Respondent’s Relational Status (as based on 2 Levels)

MANOVA was hence not conducted [Note: ‘Two-way’ relates to an analysis involving one


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dependent and two independent variables e.g., Type of Joint venture (4 levels) and Respondent’s

Relational Status (2 levels) ]. Namely, this is because the frequency count of all 72 individual

resultant cells for the each of the nine dependent variables were less than 10.

Based on the individual MANOVA's which were conducted, the statistical significance of a

multivariate main effect (i.e., according to Type of Joint Venture and Respondent’s Relational

Status) was evaluated using Pillai’s Trace criterion, as this tends to be defined as the most powerful

and statistically robust criterion of choice over and above that of other criterion multivariate

statistics (i.e., Hotelling’s Trace, Roy’s, Wilks’ Lambda), particularly in the context of unequal n’s

and decreased sample size, as used to define and classify the significance of associative main effects

and interactions (Tabachnick & Fidell, 1989).

Alternatively, in the absence of multivariate significance for the dependent measures, further

investigative Univariate (i.e., based on one dependent variable of interest) Analyses of Variance of

individual items were performed. Upon finding significant F-ratio (F) values based on specific

degrees of freedom (df), subsequent pair wise post-hoc Tukey Honestly Significant Difference (or

Tukey HSD) pair wise comparisons were conducted in order to maximize the level of statistical

power in discerning significant Group-related differences according to Type of Joint Venture and

Respondent’s Relational Status among the available data, with which to determine and identify

differing and variant procurement-based practices. Tukey HSD comparisons represent a post hoc

multiple comparison procedure for unequal n in which the Type I error rate is maintained at the

predefined 5% level of significance for all pair wise comparisons (Hinkle, Wiersma & Jurs, 1988).

5.1.5.7. Utilisation and Computation of Effect Sizes.

In the presence of a significant post-hoc contrast, Effect Sizes were subsequently calculated to

determine the magnitude of significance of this relationship as expressed in terms of standard


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deviation units, by dividing the difference between the two respective means by the pooled standard

deviation of both sample groups (Shavelson, 1996). Hence, as Effect Sizes were expressed in

standardized units, it was thus possibly to compare differing Effect Sizes concerning comparing the

magnitude of significance between two differing pairs of Types of Joint venture (e.g., ‘Route 3 and

MTRC’ relative to ‘Terminal 8 and East Rail’). According to Cohen (1988, 1992), a small, medium

and large Effect Size are respectively defined in magnitude as being 0.20, 0.50 and 0.80.

5.1.5.8. Stepwise and Hierarchical Multiple Regression Analytic Procedures.

Further, Stepwise Multiple Regression analysis was initially used in predicting levels of Satisfaction

with Joint Venture Performance as regressed on Cultural Divergence, Competitive Advantage,

Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation, Commitment

to Joint Venture, and Organisational Commitment. In contrast to Forward Selection Regression, in

which the regression equation starts out empty with variables being added one at a time conditional

upon meeting statistical criteria, or alternatively Backward Deletion Regression, in which all

variables are entered at the same time and then deleted one at a time if they do not contribute

significantly to the regression equation, Stepwise Regression is considered the most conservative

and best approach to prediction of a specified dependent variable through complimenting aspects of

both Forward Selection and Backward Deletion (Tabachnick & Fidell, 1989).

Based on the subsequent results attained through Stepwise Multiple Regression, therefore,

Hierarchical Multiple Regression was then performed to allow for an examination the effects of

specific ordered independent variables and relevant interaction term(s) on levels of Satisfaction with

Joint Venture Performance. Such a statistical procedure was used, as based upon an à priori and

prioritized ordering of entry of variables into the regression equation (i.e., Cultural Divergence at

Step 1, Commitment to Joint Venture at Step 2, followed by the relevant ‘Cultural Divergence x

Commitment to Joint Venture’ interaction term at Step 3), in order to determine if the addition of


130

information relating to that of subsequent variables, added at each additional step in the regression

equation, improved prediction of the dependent variable (i.e., Satisfaction with Joint Venture

Performance), beyond that of other preceding variables in the regression equation. Hence, such a

procedure, wherein the order of variables is based on either logic and/or theoretical considerations,

allows explicit hypotheses to be tested according to the proportion of variance attributable to

independent variables (IVs) after variance due to other IVs already in the regression equation has

been accounted for (Tabachnick & Fidell, 1989).

Consequently, as the relevant research literature reportedly suggests cultural divergence to be a

highly salient and significant variable in accounting for differences in organisational learning,

knowledge-based management as well as project-based joint venture practices (e.g., Chan & Tse,

2003; Zeybek, O’Brien & Griffith (2003), Cultural Divergence was entered at Step 1 (and hence

Commitment to Joint Venture at Step 2, the relevant ‘Cultural Divergence x Commitment to Joint

Venture’ interaction term at Step 3).

At each step in the regression equation, therefore, the significance of relevant predictors (i.e.,

Cultural Divergence at Step 1, Commitment to Joint Venture at Step 2, ‘Cultural Divergence x

Commitment to Joint Venture’ interaction term at Step 3) at the 5% level of significance was

defined according to the:

• Significance of Raw Regression Coefficient (i.e., B) and Standard Error of B (i.e., ‘SE B’);

Based on raw scale scores of centered predictor variables;

• Significance of Standardized Regression Coefficients (i.e., β or Beta Weights, as taken from the

order of entry of variables into the regression equation); Based on standardization of the raw

scale scores of centered predictors, hence allowing for direct cross-comparison of the relative

magnitude of differing Beta Weights; and


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• Significance of Incremental Variance (i.e., ΔR2) and F-ratio change associated with addition of

the predictor variable to the regression equation at each Step.

Furthermore, following the recommendations of Aiken and West (1991), to maximize

interpretability of the subsequent regression solution and minimize associative problems of multi-co

linearity (i.e., defined when correlations among dependent variables are high, namely, in excess of

0.80 to 0.90) associated with the use of interactions, such variables were initially centered about

their mean (i.e., ‘Centered’ Variable = Individual Raw Score (of Original Variable) – Mean (of

Original Variable) ], prior to individual variables being entered into the regression equation and

computation of the relevant interaction term [ i.e., ‘Centered’ Variable A x ‘Centered’ Variable B x

… ], as based on the formulaic approach described and detailed by Aiken and West (1991).

5.2. Results.

Results are presented in two sections: (i) Internal Consistency (Cronbach’s Alpha) and Item

Discrimination of the Strategic Alliance Contracting Inventory (SACI); and (ii) Descriptive and

Inferential Statistics Relating to Relationships and Differences among the Sample (n = 40).

5.2.1. Internal Consistency (Cronbach’s Alpha) and Item Discrimination of the Strategic Alliance

Contracting Inventory (SACI).

Tables 5.3 to 5.11 detail the reliability and item discrimination characteristics of each dependent

measure (i.e., Satisfaction with Joint Venture Performance, Cultural Divergence, Competitive

Advantage, Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation,

Commitment to Joint Venture, Organisational Commitment). As can be seen, subsequent

examination of the nine dependent measures demonstrated each construct to be highly reliable (i.e.,

Cronbach’s Alphas = 0.76 to 0.90), as well as construct validity as based on the corrected item-total


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correlations reported in Tables 5.3 to 5.11, which demonstrate the high level of inter-relatedness of

individual items in measuring the same construct.

Although it is acknowledged that among some dependent measures [ i.e., Satisfaction with Joint

Venture Performance: Phi = 0.02 to 0.47; Cultural Divergence: Phi = 0.00 to 0.44; Competitive

Advantage: Phi = - 0.18 to 0.05; Inter-Organisational Trust: Phi = - 0.10 to 0.40; Strategic Fit: Phi =

- 0.15 to 0.60; Decision Control: Phi = 0.53 to 0.67; Inter-Parent Cooperation: Phi = 0.10 to 0.50;

Commitment to Joint Venture: Phi = 0.13 to 0.46; Organisational Commitment: Phi = - 0.05 to 0.50

], the discriminating power of some items appeared to be relatively low, insufficient evidence

existed with which to justify such aspects as being reflective of that particular construct.

This is particularly true in light of sampling variability inherent among such a relatively small group

of participants (n = 40), and more so, the satisfactory range of variant item-total correlations

achieved with each measure.


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Table 5.3: Internal Consistency (Cronbach’s Alpha) and Item Discrimination of ‘Satisfaction with Joint Venture Performance’.

Note: Phi values > 0.40 in bold (good result); 0.2 to 0.39 are underlined (satisfactory result); 0.10 to 0.19 are in italics (marginally acceptable); less

than 0.10 are in normal print (unlikely to be acceptable or should be revised).

Satisfaction with Joint Venture Performance (9 items); Cronbach’s Alpha = 0.84

Item Content Phi Corrected Item-

Total Correlation Alpha if

Item Deleted

7. Our company could not be more pleased with the performance of our Joint Ventures

0.0250 0.4920 0.8352

15. In Hong Kong, one is likely to experience a lot of difficulties with establishing and maintaining joint ventures with partner organisations. (Reverse scored)

0.1260 0.4478 0.8435

29. We wish to get out of our joint venture(s) as soon as possible. (Reverse scored)

0.4045

0.5461 0.8276

34. Generally, I could not be more pleased with the performance of our joint venture(s).

0.1005 0.6605 0.8147

35. Our company and the partner organisation maintain a strong committed and purposeful relationship.

0.2582 0.7574 0.8077

43. I have been satisfied with the way in which decisions were made in this joint venture or alliance with the partner organisation.

0.3736 0.6122 0.8235

51. We have been extremely satisfied with the progress that has been made towards achieving our long-term goals in joint ventures.

0.3437 0.7695 0.8089

55. Our organisation’s investments in joint venture(s) are always rewarded beyond original expectations.

- 0.1517 0.5267 0.8299

56. There are a number of benefits associated with partnerships between foreign multinational and local companies in Hong Kong, despite the cultural differences which exist.

0.4695 0.3516 0.8444


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Table 5.4: Internal Consistency (Cronbach’s Alpha) and Item Discrimination of ‘Cultural Divergence’.

‘Cultural Divergence’ (10 items); Cronbach’s Alpha = 0.78



Item Deleted

2. Communication with partner organisations has been very difficult. 0.1517 0.7100 0.7303 8. It is not possible to close the cultural differences in such project based practices covering the management, transfer of technology and knowledge with the partner organisations in Hong Kong.

0.1777 0.6034 0.7395

13. Partner organisations have had unreasonable expectations about joint ventures.

0.1777 0.3471 0.7748

17. Partner organisations have had control over the planning process in joint ventures.

- 0.1260 0.2598 0.7904

27. Mutual trust with partner organisations has been difficult to establish, given the cultural differences which exist.

0.0000 0.5581 0.7468

39. Because of cultural differences in knowledge and socialization between JV partners, it is often difficult to establish mutually agreed goals and objectives when undertaking major infrastructure projects in Hong Kong.

0.1005 0.6604 0.7353

40. In order to do their work, JV partners are very dependent on one another for information. (Reverse scored)

- 0.1260 0.3645 0.7737

60. It is not difficult to establish project-based partnerships amongst foreign multinational companies in Hong Kong, even in light of the existence of some cultural differences. (Reverse scored)

0.4364 0.1905 0.7891

64. The transfer of technology, knowledge, and skills between foreign multinational and local companies is frequently limited or restricted because of cultural differences in Hong Kong.

0.1517 0.5472 0.7531

66. Due to cultural differences, multi-national contracting companies gain little benefit from establishing a strategic alliance with a local company in Hong Kong.

0.3437 0.3177 0.7766


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Table 5.5: Internal Consistency (Cronbach’s Alpha) and Item Discrimination of ‘Competitive Advantage’.

‘Competitive Advantage’ (6 items); Cronbach’s Alpha = 0.76



Item Deleted

4. My joint venture or strategic alliance experience in Hong Kong has been really different from any others that my company or I have had outside Hong Kong.

0.0750 0.4572 0.7384

12. Although the law and regulations do not force foreign investors to have a local partner in Hong Kong, for competitive reasons, it is better to engage in a partnership arrangement.

- 0.0503 0.5360 0.7191

24. The competitive environment is so complex that one needs a joint venture partner to do business in Hong Kong.

0.0750 0.3462 0.7802

67. Compared to our competitors in this industry, our organisation has gained important access to technology transfer and knowledge through engaging in a joint venture relationship with a partner organisation in Hong Kong.

0.0000 0.6631 0.6891

68. The establishment of a joint venture or strategic alliance with a partner organisation in Hong Kong has been advantageous in gaining access to new commercial opportunities, human resources, and markets not otherwise available.

- 0.1796 0.4260 0.7452

69. The competitive status of this company has been improved in terms of the transfer of knowledge, skills and expertise gained through the development of a joint venture or strategic alliance with a partner organisation in Hong Kong.

- 0.1531 0.6881 0.6808


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Table 5.6: Internal Consistency (Cronbach’s Alpha) and Item Discrimination of ‘Inter-Organisational Trust’.

‘Inter-Organisational Trust’ (9 items); Cronbach’s Alpha = 0.81



Item Deleted

6. Once our company enters into a JV-strategic alliance with another partner, it usually takes a great deal of trust to ensure that the other partner will work in the best interests of the partnership

0.3736 0.3642 0.8087

11. Once our company establishes a business relationship with another partner, it remains very loyal to that relationship and works hard to ensure that the relationship remains strong for a long time.

0.3437 0.5169 0.7920

14. The partner organisation in our JV-alliance(s) can be trusted to make sensible decisions.

0.2860 0.5641 0.7844

16. Partner organisations in our alliances would be quite prepared to gain advantage by deceiving our company. (Reverse scored)

0.2309 0.4941 0.7957

20. Parties in our alliances can rely on each other to abide by original JV agreements and obligations.

0.4045 0.6002 0.7842

38. There has been a high degree of trust between our company and our JV partner organisation.

0.2860 0.7193 0.7624

53. Parties in our JV-alliance(s) have had a high level of mutual trust in most activities.

0.2860 0.5343 0.7888

61. Our organisation is willing to provide and share managerial resources, knowledge and expertise with the partner organisations in our joint ventures.

0.4045 0.4353 0.8003

65. JV partners never profit from opportunities that arise out of partner organisations, at the expense of the JV/alliance.

- 0.1005 0.3884 0.8082


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Table 5.7: Internal Consistency (Cronbach’s Alpha) and Item Discrimination of ‘Strategic Fit’.

‘Strategic Fit’ (18 items); Cronbach’s Alpha = 0.80



Item Deleted

3. In order to accomplish their individual responsibilities, JV partners have depended highly on one another for services, support and resources.

0.1001 0.1913 0.8025

9. JV partner organisations have been always ready to help one another when the need arises

0.2285 0.5206 0.7796

10. JV partner organisations are only interested in short-term rather than long-term benefits. (Reverse scored)

- 0.1011 0.3138 0.7941

21. Joint venture partner organisations are only interested in quick profits and are reluctant to reinvest in the joint venture. (Reverse scored)

0.0750 0.4417 0.7853

22. Our company and our partner organisations decide when and how changes should be made in the JV/alliances.

0.4910 0.3515 0.7923

23. The experience of this company of continuing or forming new joint ventures with cultural diverse partner organisations in Hong Kong, generally lasts between 5 to 10 years.

0.3098 0.3722 0.7901

25. JV partner organisations are only interested in gaining access to each other’s technology. (Reverse scored)

0.2285 0.4838 0.7819

28. This company and the partner organisation get along very well as a co-coordinated team.

0.2552 0.5746 0.7762

30. Our company is reluctant to make resource commitments to the JV alliance when specifications in the agreement are ambiguous. (Reverse scored)

0.1764 0.2839 0.7964


138

Table 5.7: Internal Consistency (Cronbach’s Alpha) and Item Discrimination of ‘Strategic Fit’ (Continued …).

‘Strategic Fit’ (18 items); Cronbach’s Alpha = 0.80



Item Deleted

32. Partners in joint venture(s) are ready to defend one another against criticism by outsiders.

0.3965 0.5060 0.7815

36. In order to develop effective partnerships between foreign multinational companies and local companies in Hong Kong, leadership behaviour which takes account of cultural differences, is important.

0.5966 0.3011 0.7953

41. In the establishment and maintenance of JV-strategic alliances, local Hong Kong companies tend to operate and adapt well in working together as a coordinated team with foreign multinational companies, despite the cultural differences which exist between them.

0.2552 0.3747 0.7899

42. There have been a number of difficulties in successfully forming effective and efficient project-based relationships between foreign multinational and local companies in Hong Kong, because of cultural differences and the perception of task obligations/commitments. (Reverse scored)

- 0.1531 0.1600 0.8016

47. The partners keep one another informed of changes and events that might affect them

0.3380 0.5938 0.7774

49. The establishment of various types of alliances or joint ventures with partner organisations in Hong Kong has been very limited because of cultural differences in management and work practices. (Reverse scored)

0.3669 0.3265 0.7927

50. This company has had lengthy experience in joint venturing with other partner organisations in Hong Kong.

0.4910 0.5369 0.7815

52. Due to the cultural similarities between local companies, it is often easier for such organisations to enter into business ventures or partnerships, rather than with foreign companies in Hong Kong. (Reverse scored)

0.0000 0.3304 0.7940

59. Our organisation has plans for increasing levels of assistance to our joint ventures.

0.1764 0.2616 0.7965


139

Table 5.8: Internal Consistency (Cronbach’s Alpha) and Item Discrimination of ‘Decision Control’.

‘Decision Control’ (3 items); Cronbach’s Alpha = 0.80



Item Deleted

5. The way in which strategic decisions have been made has been determined between our company and the partner organisation.

0.6414 0.7385 0.6251

46. Decisions in this relationship with the partner organisation have been applied with fairness, respect and courtesy.

0.5292 0.7493 0.6114

54. There is two-way communication in the decision-making process between the JV partners at executive level.

0.6713 0.4915 0.8607


140

Table 5.9: Internal Consistency (Cronbach’s Alpha) and Item Discrimination of ‘Inter-Parent Cooperation’.

‘Inter-Parent Cooperation’ (12 items); Cronbach’s Alpha = 0.76



Item Deleted

1. When an unexpected situation arises, JV partners would rather work out a new arrangement than hold each other to the original JV obligations.

0.2309 0.1119 0.7793

18. In most aspects of relationships, JV partners share the responsibility for getting things done.

0.2309 0.3165 0.7541

19. Exchanges of information take place frequently, informally and openly between JV Partner organisations.

0.1005 0.5509 0.7253

26. Problems that arise in JV/strategic alliances are resolved jointly rather than as individual partner’s responsibilities.

0.4045 0.5753 0.7275

31. It is generally expected that the parent companies in JV relationships will openly provide information covering production, research, development, budgeting etc., if it can help the joint venture.

0.1517 0.4254 0.7395

33. The responsibility for making sure that the relationship within the JV-alliance works is shared equally amongst parties.

0.2041 0.3061 0.7577

37. JV partners have been prepared modify their agreement if unexpected events occur.

0.2860 0.4518 0.7366

44. Changes to contract terms and obligations are willingly agreed to by JV partners if they are considered necessary.

0.2860 0.5835 0.7199

45. Partners had to co-ordinate with each other to ensure that they carried out their work in an efficient manner.

0.4045 0.3797 0.7448

48. Partner organisations have been willing and ready to concede on issues to enable the joint venture to achieve its strategic goals and objectives, as stated in the agreement

0.4364 0.4502 0.7387

62. The JV-alliance is flexible when our company cannot keep to a specific promise stipulated in the JV-alliance agreement, due to unexpected environmental changes.

0.2860 0.3978 0.7442

63. This company tries to ensure that JV partner organisations know what is expected of them in joint venture arrangements.

0.5039 0.3830 0.7454


141

Table 5.10: Internal Consistency (Cronbach’s Alpha) and Item Discrimination of ‘Commitment to Joint Venture’.

‘Commitment to Joint Venture’ (6 items); Cronbach’s Alpha = 0.86



Item Deleted

70. I tell my friends that our JV-alliance(s) are great to be involved with. 0.2023 0.7022 0.8218 71. I do not feel much loyalty to our JV-alliance(s). (Reverse scored) 0.3098 0.5952 0.8448 72. I am proud to tell others that I am involved with these JV-alliances. 0.3098 0.8111 0.8002 73. Deciding to work with these JV-alliances was a definite mistake on my part. (Reverse scored)

0.4585 0.7450 0.8189

74. There’s not much to be gained by remaining indefinitely with these JV-alliances. (Reverse scored)

0.3380 0.6424 0.8338

75. For myself, these are the best of all JV-alliances to be associated with. 0.1254 0.4268 0.8694


142

Table 5.11: Internal Consistency (Cronbach’s Alpha) and Item Discrimination of ‘Organisational Commitment’.

‘Organisational Commitment’ (16 items); Cronbach’s Alpha = 0.90



Item Deleted

57. Our organisation has plans to expand the scale of operations in our existing joint venture arrangements with partner organisations.

0.0501 0.3933 0.8983

58. Our organisation always stands by its word, even when this was not in its best interests in its JV’s.

0.1777 0.4022 0.8980

76. I am willing to put in a great deal of effort beyond that normally expected in order to help this organisation be successful.

0.5039 0.4899 0.8961

77. I tell my friends that this company is a great one to be associated with. 0.3736 0.8798 0.8822 78. I feel very little loyalty to this organisation. (Reverse scored) 0.3736 0.6838 0.8886 79. I find that my values and that of my company’s values are similar. 0.2860 0.6258 0.8908 80. I am proud to tell others that I am associated with this company. 0.4045 0.8896 0.8817 81. Becoming associated with this company was a definite mistake on my part. (Reverse scored)

0.5039 0.5642 0.8947

82. I really care about the fate of this company. 0.3145 0.6659 0.8891 83. For myself, this is the best of all organisations to be associated with. 0.4695 0.7411 0.8883 84. I would accept almost any type of job assignment in order to keep working for this organisation.

0.0250 0.1557 0.9103

85. I could just as well be working for a different organisation as long as the type of work were similar. (Reverse scored)

0.1260 0.5871 0.8925

86. This organisation really inspires the very best in me in the way of job performance

0.3145 0.6400 0.8902

87. It would take very little in my present circumstances to cause me to leave this organisation. (Reverse scored)

- 0.0501 0.4911 0.8978

88. I am extremely glad that I chose this organisation to work for over others I was considering at the time I joined

0.4045 0.4843 0.8957

89. Often, I find it difficult to agree with this organisation’s policies on important matters relating to its employees. (Reverse scored)

0.0501 0.6376 0.8903


159

5.2.2. Descriptive and Inferential Statistics Relating to Relationships and Differences Among the Sample

(n = 40).

5.2.2.1. Inter-Relationships between Age of the Alliance, Number of Inter-Firm Partnerships and

Dependent Measures.

Table 5.12 (see the following page) shows the significance and nature of the inter-relationships between Age of

the Alliance, Number of Inter-Firm Partnerships and the nine dependent measures, as given by the reported

Pearson product-moment correlation coefficients.

As shown in Table 5.12, Satisfaction with Joint Venture Performance, Cultural Divergence, Competitive

Advantage, Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation, Commitment to

Joint Venture, Organisational Commitment were not significantly related by Age of the Alliance nor by Number

of Inter-Firm Partnerships.

Moreover, increases in Cultural Divergence were associated with concomitant decreases in Satisfaction

with Joint Venture Performance, Inter-Organisational Trust, Decision Control and Commitment to Joint

Venture. Conversely, Satisfaction with Joint Venture Performance was significantly positively related

to Competitive Advantage, Strategic Fit, Decision Control, Inter-Parent Cooperation, Inter-

Organisational Trust, and Commitment to Joint Venture.


159

Table 5.12: Inter-Relationships Between Age of the Alliance, Number of Inter-Firm Partnerships and Dependent

Measures.

Variable 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.

1. Age of the Alliance (Years)

0.28

(n = 37)

0.08

(n = 37)

- 0.07

(n = 37)

- 0.23

(n = 37)

0.14

(n = 37)

0.23

(n = 37)

- 0.02

(n = 37)

0.25

(n = 37)

0.06

(n = 37)

0.37 *

(n = 37)

2. Number of Inter-Firm Partnerships

− 0.05 (n = 40)

- 0.04 (n = 40)

- 0.05 (n = 40)

0.12 (n = 40)

0.23 (n = 40)

0.26 (n = 40)

0.10 (n = 40)

< 0.01 (n = 40)

0.28 (n = 40)

3. Satisfaction with JV Performance

− - 0.55 ***(n = 40)

0.53 *** (n = 40)

0.65 ****(n = 40)

0.59 ****(n = 40)

0.52 *** (n = 40)

0.57 ****(n = 40)

0.84 ****(n = 40)

0.21 (n = 40)

4. Cultural Divergence

− - 0.17 (n = 40)

- 0.44 ** (n = 40)

- 0.32 * (n = 40)

- 0.46 ** (n = 40)

- 0.26 (n = 40)

- 0.36 * (n = 40)

- 0.10 (n = 40)

5. Competitive

Advantage

− 0.28 (n = 40)

0.18 (n = 40)

0.13 (n = 40)

0.27 (n = 40)

0.58 ****(n = 40)

0.05 (n = 40)

6. Inter-

Organisational Trust

− 0.62 ****(n = 40)

0.79 ****(n = 40)

0.70 ****(n = 40)

0.69 ****(n = 40)

0.38 * (n = 40)

7. Strategic Fit

− 0.46 ** (n = 40)

0.71 ****(n = 40)

0.57 ****(n = 40)

0.33 * (n = 40)

8. Decision

Control

− 0.52 *** (n = 40)

0.53 *** (n = 40)

0.27 (n = 40)

9. Inter-Parent

Cooperation

− 0.65 ****(n = 40)

0.34 * (n = 40)

10. Commitment to

JV

− 0.40 * (n = 40)

11. Organisational

Commitment

−

Note: Departures from n = 40 indicate missing data. * p < 0.05 ** p < 0.01 *** p < 0.001 **** p < 0.0001.


161

Further, whereas Competitive Advantage and Commitment to Joint Venture were significantly

positively related, Inter-Parent Cooperation, Inter-Organisational Trust, Strategic Fit, Commitment

to Joint Venture, and Organisational Commitment were also significantly positively related.

In addition, Competitive Advantage was significantly positively associated with Commitment to

Joint Venture and Satisfaction with Joint Venture Performance. There were no other significant

interrelationships between self-reports.

Hypothesis One which stated that “respondents’ self-reports of Satisfaction with Joint Venture

Performance, Cultural Divergence, Competitive Advantage, Inter-Organisational Trust, Strategic

Fit, Decision Control, Inter-Parent Cooperation, Commitment to Joint Venture, Organisational

Commitment will be significantly interrelated” was therefore supported.

In addition, with the exception of the significant positive relationship Organisational Commitment (r

= 0.37, p < 0.001), the absolute magnitude of 18 of the 19 inter-correlations between Age of the

Alliance, Number of Inter-Firm Partnerships and self-report measures were less than 0.40 (Range =

– 0.08 to + 0.28). Insufficient evidence existed therefore to justify using either Age of the Alliance

nor Number of Inter-Firm Partnerships as covariates in subsequent statistical analyses.

5.2.2.2. Satisfaction with Joint Venture Performance, Cultural Divergence, Competitive Advantage,

Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation, Commitment

to Joint Venture, Organisational Commitment: MANOVA, Univariate, and Pairwise Post-hoc

Tukey HSD Comparisons.

The results of the One-way Type of Joint Venture (i.e., Terminal 8, Route 3, MTRC, East Rail) and

One-way Relational Status (i.e., Head Office, Onsite) MANOVA's failed to reveal significance in

differentiating among one or more of the nine dependent variables either according to Type of Joint


162

Venture [ F (df = 27, 90) = 1.58, p = 0.057; Pillai’s Trace criterion = 0.965 ] nor by Respondent’s

Relational Status [ F (df = 18, 60) = 1.38, p > 0.05; Pillai’s Trace criterion = 0.586 ].

Hypothesis Two which stated that “differences in respondents’ self-reports will be influenced

according to Type of Joint Venture and Relational Status (i.e., Head Office, Onsite Project

Management)” is therefore not supported.

Subsequently, Univariate ANOVAs and pair wise post-hoc Tukey HSD comparisons were

conducted in order to further investigate mean item-related differences according to Type of Joint

Venture and Relational Status. Univariate ANOVA results demonstrated there were significant

differences (p < 0.05) among 18 and five of the 89 items according to Type of Joint Venture and

respondent’s Relational Status, respectively. Tables 5.13, 5.14 and 5.15 present the Univariate F-

ratios, means, standard deviations, post-hoc between-group differences and associated Effect Sizes,

where appropriate.


163

Table 5.13: Item-Related Differences According to Type of Project-Based Joint Venture: Means (and Standard Deviations).

Type of Project-Based Joint Venture

Item Number & Description

Terminal 8 (n = 3)

Route 3 (n = 13)

MTRC (n = 12)

East Rail (n = 12)

F (3, 36)

10. JV partner organisations are only interested in short-term rather than long-term benefits. (Reverse scored)

3.00 (SD = 1.73)

4.31 (SD = 0.95)

2.92 (SD = 0.90)

3.42 (SD = 1.44)

3.30 *

13. Partner organisations have had unreasonable expectations about joint ventures.

3.00 (SD = 2.00)

2.31 (SD = 0.85)

3.75 (SD = 0.87)

3.00 (SD = 1.28)

3.62 *

30. Our company is reluctant to make resource commitments to the JV alliance when specifications in the agreement are ambiguous. (Reverse scored)

3.67 (SD = 1.53)

4.46 (SD = 1.05)

4.58 (SD = 1.00)

3.08 (SD = 1.31)

4.34 *

33. The responsibility for making sure that the relationship within the JV-alliance works is shared equally amongst parties.

3.00 (SD = 1.00)

4.77 (SD = 1.17)

3.42 (SD = 1.00)

4.08 (SD = 1.56)

3.17 *

34. Generally, I could not be more pleased with the performance of our joint venture(s).

4.67 (SD = 1.15)

4.23 (SD = 1.36)

2.75 (SD = 1.14)

4.00 (SD = 1.41)

3.58 *

35. Our company and the partner organisation maintain a strong committed and purposeful relationship.

3.33 (SD = 1.53)

4.62 (SD = 0.65)

3.42 (SD = 0.79)

4.50 (SD = 1.00)

5.52 **

38. There has been a high degree of trust between our company and our JV partner organisation.

3.33 (SD = 1.15)

4.77 (SD = 1.01)

3.50 (SD = 1.17)

4.50 (SD = 1.17)

3.58 *

53. Parties in our JV-alliance(s) have had a high level of mutual trust in most activities.

2.67 (SD = 1.15)

4.62 (SD = 0.65)

3.42 (SD = 1.24)

4.42 (SD = 0.67)

6.62 **


2.67 (SD = 1.15)

3.69 (SD = 1.03)

3.00 (SD = 1.04)

4.00 (SD = 0.85)

2.90 *

* p < 0.05 ** p < 0.01.


164

Table 5.13: Item-Related Differences According to Type of Project-Based Joint Venture: Means (and Standard Deviations) (Continued …).

Type of Project-Based Joint Venture


Terminal 8 (n = 3)

Route 3 (n = 13)

MTRC (n = 12)

East Rail (n = 12)

F (3, 36)

59. Our organisation has plans for increasing levels of assistance to our joint ventures.

2.00 (SD = 1.00)

3.62 (SD = 0.96)

3.50 (SD = 1.00)

4.33 (SD = 0.78)

5.48 **

71. I do not feel much loyalty to our JV-alliance(s). (Reverse scored) 4.33 (SD = 2.08)

5.38 (SD = 0.65)

3.58 (SD = 1.16)

4.75 (SD = 1.54)

4.56 **

72. I am proud to tell others that I am involved with these JV-alliances.

4.00 (SD = 2.00)

4.85 (SD = 0.99)

3.67 (SD = 1.07)

4.92 (SD = 1.16)

3.20 *

75. For myself, these are the best of all JV-alliances to be associated with.

2.67 (SD = 1.53)

4.38 (SD = 0.77)

3.42 (SD = 1.16)

4.08 (SD = 1.16)

3.12 *

77. I tell my friends that this company is a great one to be associated with.

3.00 (SD = 2.00)

4.92 (SD = 0.95)

4.17 (SD = 1.11)

5.42 (SD = 0.79)

5.74**

78. I feel very little loyalty to this organisation. (Reverse scored) 3.00 (SD = 2.00)

5.23 (SD = 1.17)

4.58 (SD = 1.51)

5.50 (SD = 0.67)

3.91 *

80. I am proud to tell others that I am associated with this company. 3.00 (SD = 2.00)

5.08 (SD = 0.76)

4.50 (SD = 1.09)

5.33 (SD = 1.23)

4.09 *

82. I really care about the fate of this company. 2.00 (SD = 1.00)

5.62 (SD = 0.51)

4.33 (SD = 1.83)

5.58 (SD = 0.90)

9.77 ****

85. I could just as well be working for a different organisation as long as the type of work were similar. (Reverse scored)

2.33 (SD = 1.53)

3.92 (SD = 1.38)

3.33 (SD = 1.78)

4.67 (SD = 1.07)

2.91 *

* p < 0.05 ** p < 0.01 **** p < 0.0001.


165

Subsequent to the significant Univariate F-ratios provided in Table 5.13, according to Type of Joint

Venture, a summary of the relevant post-hoc Tukey HSD comparisons and their associated Effect

Sizes between differing Types of Joint Ventures are given in Table 5.14.

Table 5.14: Effect Sizes for Post-hoc Item-Related Comparison According to Type of Joint

Venture.

Effect Sizes for Post-hoc Item-Related Comparison of Type of Joint Venture

Item Route 3 MTRC

Route 3 East Rail

MTRC East Rail

Terminal 8 Route 3

Terminal 8 East Rail

Terminal 8 MTRC

10 1.21 − − − − −

13 1.29 − − − − −

30 − 1.02 1.09 − − −

33 1.07 − − − − −

34 1.02 − − − − −

35 1.28 − 1.04 − − −

38 1.02 − − − − −

53 1.06 − 0.91 1.83 1.69 −

57 − − − − − −

59 − − − 1.42 1.87 71 1.39 − − − − −

72 − − − − − −


166

Table 5.14: Effect Sizes for Post-hoc Item-Related Comparison According to Type of Joint Venture

(Continued …).

Effect Sizes for Post-hoc Item-Related Comparison of Type of Joint Venture

Item Route 3

MTRC

Route 3

East Rail

MTRC

East Rail

Terminal 8

Route 3

Terminal 8

East Rail

Terminal 8

MTRC

75 − − − − − −

77 − − 1.10 1.41 1.68 −

78 − − − 1.43 1.77 −

80 − − − 1.59 1.42 −

82 0.89 − − 2.30 2.08 1.21

85 − − − − − − Note: Where an Effect Size has been reported, as measured by the difference between respective sample means (e.g., for Item 10 – Route 3 & MTRC) and then divided by the pooled standard deviation of the sample subgroup (i.e., Route 3 & MTRC), this indicates the presence of the significant item-related difference and the magnitude of that significance, as defined by the Effect Size. Conversely, where no Effect Size has been reported, as symbolised by “−”, this indicates that there was no significant item-related difference for a particular post-hoc comparison. For example, for item 10, there were no significant item-related differences between Route 3 and East Rail, nor between Terminal 8 and Route 3 for Item 10.

According to Table 5.14, significant post-hoc mean item-related differences between Type of Joint

Ventures tended to be more so between than Route 3 and MTRC, Route 3 and Terminal 8, and

Terminal 8 and East Rail, which tended to be associated with large Effect Sizes. Further, although

there was a significant Univariate F-ratio for Item 57 [ i.e., F (df = 3, 36) = 2.90, p < 0.05 ], Item 72

[ i.e., F (df = 3, 36) = 3.20, p < 0.05 ], Item 75 [ i.e., F (df = 3, 36) = 3.12, p < 0.05 ], and Item 85 [

i.e., F (df = 3, 36) = 2.91, p < 0.05 ] (refer to Table 4.12 on pages 131 & 132), thereby indicating

there were significant mean item-related differences according to Type of Joint Venture (i.e.,

Terminal 8, Route 3, MTRC, East Rail). The failure, however, to subsequently reveal significant

post-hoc mean item-related differences at the 5% level of significance for Items 57, 72, 75, and 85

appears to be partially attributable to a lack of statistical power, largely due to the relatively small


167

sample size in being able to detect significant post-hoc differences in these four items where such

differences were apparent according to Type of Joint Venture (i.e., Terminal 8; n = 3; Route 3: n =

13; MTRC: n = 12; East Rail: n = 12).

Table 5.15 reports the means and standard deviations of significant item-level comparisons

according to project-based Respondent’s Relational Status. As indicated by Table 5.15, with the

exception of Item 51, there were significant differences in self-reports between Onsite and Head

Office respondents for Items 23, 57, 58 and 61. Moreover, such differences tended to be associated

with moderate to large Effect Sizes (i.e., 0.75 to 0.95). The absence of significance between Onsite

and Head Office participants for Item 51, however, appears attributable to insufficient sampling

variability due to the relatively small number of Onsite (n = 23) and Head Office (n = 16)

participants who were sampled.


168

Table 5.15: Item-Related Comparison According to Project-Based Relational Status: Means (and Standard Deviations).

Project-Based Relational Status


Onsite (n = 23)

Head Office (n = 16)

Other (n = 1)

F (2, 37) Effect Size

23. The experience of this company of continuing or forming new joint ventures with cultural diverse partner organisations in Hong Kong generally lasts between 5 to 10 years.

3.82 (SD = 1.37)

4.82 (SD = 0.83)

5.00 3.49 * 0.79

51. We have been extremely satisfied with the progress that has been made towards achieving our long-term goals in joint ventures.

4.30 (SD = 0.82)

3.75 (SD = 0.93)

6.00 4.32 * −


3.13 (SD = 0.97)

4.00 (SD = 1.03)

4.00 3.74 * 0.82

58. Our organisation always stands by its word, even when this was not in its best interests in its JV’s.

3.70 (SD = 1.02)

4.68 (SD = 0.79)

3.00 5.99 ** 0.95

61. Our organisation is willing to provide and share managerial resources, knowledge and expertise with the partner organisations in our joint ventures.

4.17 (SD = 1.07)

4.94 (SD = 0.68)

6.00 4.44 * 0.75

* p < 0.05 ** p < 0.01.


169

5.2.2.3. Stepwise Multiple Regression of Satisfaction with Joint Venture Performance on

Independent Variables (i.e., Cultural Divergence, Competitive Advantage, Inter-Organisational

Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation, Commitment to Joint Venture, and


At Step 1, Commitment to Joint Venture (t = 9.381, p < 0.0001) uniquely accounted for a significant

proportion (i.e., R2 = 0.698 or 48.72%) of the shared variance in predicting levels of Satisfaction

with Joint Venture Performance [F (df = 1, 38) = 88.01, p < 0.0001], independent of the effects of

other independent variables. Moreover, at Step 2, Cultural Divergence (t = 3.23, p = 0.01) and

Commitment to Joint Venture (t = 8.57, p < 0.0001) were found to uniquely and independently

predict Satisfaction with Joint Venture Performance [ F (df = 2, 37) = 60.15, p < 0.0001 ] in

accounting for 58.52% (i.e., R2 = 0.765) in shared variance, over and above that of Competitive

Advantage, Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation and

Organisational Commitment (see Appendix H for raw statistical output as related to stepwise

multiple regression procedure performed). There were no other variables, which significantly

accounted for unique variance in levels of the dependent variable.

Hence, Hypothesis Three which stated that “Cultural Divergence and Commitment to Joint

Venture will make significant unique contributions in differentiating levels of Satisfaction with

Joint Venture Performance, relative to Competitive Advantage, Inter-Organisational Trust, Strategic

Fit, Decision Control, Inter-Parent Cooperation and Organisational Commitment” was therefore

supported.

5.2.2.4. Hierarchical Multiple Regression of Satisfaction with Joint Performance on Cultural

Divergence and Commitment to Joint Venture.

For the Hierarchical Regression, the subsequent predictor variables (i.e., Cultural Divergence,

Commitment to Joint Venture) were entered into the regression equation in the following order:


170

Cultural Divergence at Step 1, Commitment to Joint Venture at Step 2, followed by the relevant

interaction term of ‘Cultural Divergence x Commitment to Joint Venture’ at Step 3. The results are

shown in Table 5.16 (see Appendix H for raw statistical output as related to hierarchical multiple

regression procedure performed).

Table 5.16: Hierarchical Multiple Regression Analysis of Satisfaction with Joint Venture

Performance on Cultural Divergence and Commitment to Joint Venture (JV).

Satisfaction with Joint Venture Performance (Dependent variable)

Step Predictor B SE B β a ΔR2 F-change df

1 Cultural Divergence - 0.547 0.136 - 0.546 *** 0.298 16.12 *** 1, 38

2 Commitment to JV 0.912 0.106 0.734 **** 0.467 73.45 **** 2, 37

3 Two-way Interaction 0.037 6.80 * 3, 36

Cultural Divergence

x JV Commitment

- 0.045 0.017 - 1.329 *

Cumulative R 2 0.802

Final F 48.65 ****

Note: ΔR2 denotes the increment in R2 associated with the addition of variables in the regression

equation. a Standardized regression coefficients (i.e., β or beta weights) were taken from the order of entry of

variables into the regression equation. * p < 0.05 *** p < 0.001 **** p < 0.0001.

As shown in Table 5.16, after initially controlling for Cultural Divergence in Step 1 [ t = 4.02, p =

0.0003; ΔR 2 = 0.298 ], and Commitment to Joint Venture in Step 2 [ t = 8.57, p < 0.00001; ΔR2 =

0.467), the relevant interaction term of ‘Cultural Divergence x Commitment to Joint Venture’ (t =


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2.61, p = 0.01) in Step 3 added significantly to the model in incrementally accounting for 3.7% of

unique variance in predicting levels of Satisfaction with Joint Venture Performance.

Hypothesis Four which stated that “the interaction of Cultural Divergence and Commitment to

Joint Venture will significantly influence levels of Satisfaction with Joint Venture Performance”

was therefore supported.

Subsequently, following procedures described by Aiken and West (1991), the nature of the ‘Cultural

Divergence x Commitment to Joint Venture’ interaction was examined based on the simple slope

effects of the regression of Satisfaction with Joint Venture Performance on Cultural Divergence,

Commitment to Joint Venture and the relevant interaction term (i.e., ‘Cultural Divergence x

Commitment to Joint Venture’) at ‘low’ (i.e., one standard deviation below the mean), ‘medium’

(i.e., at the mean) and ‘high’ (i.e., one standard deviation above the mean) levels of each ‘centered’

variable (see Figure 5.2).


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32.5030.7931.06

38.06

34.0536.06

37.58

45.07

41.33

0

5

10

15

20

25

30

35

40

45

50

Satifaction with JV Performance

Cultural Divergence

Low Medium High

Low Commitment to JV

Medium Commitment to JV

High Commitment to JV

The scale of the Y-Axis (i.e., “Satisfaction with JV Performance”) was measured in units, as follows:

Y = (– 0.2903 x ‘Cultural Divergence’) + (0.9438 x ‘Commitment to JV’) + (– 0.0449 x ‘Cultural Divergence x Commitment to JV’) + 36.0557.

Figure 5.2: Relationship of Satisfaction with Joint Venture Performance with Cultural Divergence

and Commitment to Joint Venture.

As shown in Figure 5.2, Commitment to Joint venture was significantly negatively related to

Satisfaction with Joint Venture Performance at low, medium and high levels of Cultural Divergence

(β = – 0.04, Standard Error = 0.02, p = 0.01). Namely, as self-perceived levels of Cultural

Divergence decreased within the nature of a project-based joint venture, there were concomitant

positive increases in levels of Satisfaction with Joint Venture Performance, particularly when there

were demonstrated high as compared to medium levels of perceived commitment by staff towards

the Type of Joint Venture. Conversely, when levels of self-perceived Cultural Divergence


173

decreased, this did not positively influence Satisfaction to Joint Venture Performance when there

existed low levels of perceived commitment towards the Type of Joint Venture. Hence, Cultural

Divergence mediated the nature of the relationship between Commitment to Joint Venture and

Satisfaction with Joint Venture Performance.

5.3. Discussion of the Findings of Study Two:

Implications for Understanding Project-Based Construction Joint Ventures.

Study Two research findings have demonstrated a number of significant and noteworthy findings.

First and foremost, Cultural Divergence and Commitment to Joint Venture were found to uniquely

predict individual differences in levels of Satisfaction with Joint Venture Performance over and

above the effects of other independent variables (i.e., Competitive Advantage, Inter-Organisational

Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation, Organisational Commitment).

Pearson product-moment correlation coefficients revealed there were significantly positive and

negative interrelationships in self-reports, independent of the effects of Age of the Alliance and

Number of Inter-Firm Partnerships (refer to Subsection 5.2.3.1 and Table 5.12). Namely, Cultural

Divergence tended to be significantly negatively associated with:

• Satisfaction with Joint Venture Performance;

• Inter-Organisational Trust;

• Decision Control; and

• Commitment to Joint Venture.

Concomitantly, however, Satisfaction with Joint Venture Performance tended to be significantly

positively associated with:

• Competitive Advantage;

• Strategic Fit;

• Decision Control;


174

• Inter-Parent Cooperation;

• Inter-Organisational Trust; and

• Commitment to Joint Venture.

Furthermore, Competitive Advantage tended to be significantly positively associated with increases

in levels of Satisfaction with Joint Venture Performance, as well as related increases in

Commitment to Joint Venture. Moreover, it was also found that Inter-Parent Cooperation, Inter-

Organisational Trust, Strategic Fit, Commitment to Joint Venture, and Organisational Commitment

were all highly and significantly positively interrelated.

Consistent with such findings, Thornhill and Amit (2001) suggest that the internalised degree of

organisational and relational fit (as respectively defined in terms of organisational culture and

structure, or alternatively, through the requisite needs of the project-based venture and available

resources which exist) remain key variables which are likely to subsequently affect and impact upon

perceived commitment to joint venture. Namely, this tends to be through the degree of expressed

organisational congruence and knowledge-based management practices, in terms of the specified

deployment of resources, technological expertise and managerial skill in coordinating the

operational functioning of the joint venture.

Further, although it is acknowledged that in the contextual findings of this research, there exist to

some extent cultural differences, particularly as ‘Cultural Divergence’ evidenced a significant

relationship to Satisfaction with Joint Venture Performance, it is equally pertinent to consider the

potentiality of cultural similarities in self-reports which may have existed. For example,

organisations often base subsequent policy and fiscal investment decisions upon the importance

attached to research findings in understanding social phenomena in the corporate business world as


175

regards the dynamics of project-based joint ventures between multinational corporations (Ofori-

Dankwa & Ricks, 2000).

Additionally, within Study Two research, exploratory analysis of variance further revealed

significant mean-related differences among 18 and five of the total 89 items according to Type of

Joint Venture and Respondent’s Relational Status, respectively. More specifically, such items

tended to be related to such salient issues as comprising:

• Competitive and strategic goal orientation (i.e., Item 10);

• Expectations regarding joint ventures (i.e., Item 13);

• Expressed inter-organisational and joint venture commitment (i.e., Items 30, 35 71, 72, 75, 77,

78, 80, 82, 85);

• Mutual trust (i.e., Item 38, 53);

• Decision making practices (i.e., Item 33);

• Perceived satisfaction with joint venture performance (i.e., Item 34);

• Technological and resource-based expansion in terms of existing levels of assistance (i.e., Item

59); together with the

• Fiscal scaling of invested operations (i.e., Item 57).

With respect to the relative magnitude of such significantly reported item-related differences (refer

to Table 5.14 for the associated Effect Sizes as related to post-hoc differences), these tended to be

particularly high as concerning differences in comparative project-based construction joint ventures

in contrasting:

• Route 3 relative to MTRC (i.e., Items 10, 13, 33, 34, 35, 38, 53, 71, 82); and

• Terminal 8 relative to either Route 3 or East Rail (i.e., Items 53, 59, 77, 78, 80, 82).


176

In contrast, however, Effect Sizes tended to be of lower magnitude (refer to Table 5.14), as

associated with post-hoc differences between:

• MTRC relative to East Rail (i.e., Items 30, 35, 53, 77);

• Terminal 8 relative to MTRC (i.e., Item 82); or alternatively,

• Route 3 relative to East Rail (i.e., Item 30).

In accounting for the nature of such reported differences between the four types of project-based

construction joint ventures, therefore, it is feasible that such confounding influences such as the

fiscal capital investment, cultural background and values of respondents, which were not adequately

controlled for in the present research, may have inordinately influenced the manner in which

individuals sought to rate and respond to particular items.

Of particular and noteworthy significance, based on the presence of significant item-related

differences among five items between Head Office and Onsite personnel (i.e., Items 23, 51, 57, 58,

61; refer to Table 5.15), Head office participants tended to rate more highly such aspects as:

• Duration of continuing or established joint ventures (i.e., Item 23);

• Trust (i.e., Item 58);

• Knowledge-based information sharing of resources in combination with technological expertise

and skills (i.e., Item 61); and

• Future operational expansion (i.e., Item 57).

Conversely, Onsite project-based workers were more likely to be acutely aware and knowledgeable

regarding ascertaining the degree of progress which had been achieved towards prescribed long-

term and targeted inter-organisational goals within the context of negotiated strategic alliances and

partnerships (i.e., Item 51).


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In line with large-scale project-based joint ventures are interdependent and evolving relational

systems. This is particularly so in view of the presiding cultural differences and managerial cross-

cultural values that may exist to enable development of core competencies. This may be achieved

through the inclusive development of procurement-based inter-organisational practices between

head office and onsite project management staff. Consensual and objectively-derived and articulated

strategic goals, therefore, may be of key relevance to stakeholders that engender and establish trust,

commitment and sustained competitive advantage in order to minimise the risk of ineffectual

partnering. This has been argued to remain paramount in order to facilitate and maximise project

success (Chen, 2003; Ramaprasad & Prakash, 2003; Ward & Chapman, 2003).

In conclusion, the results of Study Two have demonstrated that cultural divergence and commitment

to the joint venture play a more active role in engendering satisfaction with joint venture

performance than does competitive advantage, inter-organisational trust, strategic fit, decision

control, inter-parent cooperation and organisational commitment.

Further research is now required in order to investigate the situational context of such

interrelationships. Case study work might help us better understand how such mitigating variables

influence the multidimensional constructs of joint venture performance and subsequent joint venture

success within and across differing organisations involved in strategic and collaborative

partnerships. Further examination is required to better understand the nature of such relationships.

This could greatly assist in empowering managerial and executive-level staff to develop and refine

more culturally appropriate knowledge-management and organisational learning practices, within

the context of project-based construction joint ventures in Hong Kong.


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In this chapter, based on the prior findings of Study One and the relevant research literature, the

methodology and validation process in developing the Strategic Alliance Contracting Inventory

(SACI) was discussed. Subsequently, this chapter provided a detailed examination of results

pertaining to the instrument development procedures employed, reliability and validity of the nine

developed scales (i.e., Satisfaction with Joint Venture Performance, Cultural Divergence,

Competitive Advantage, Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-Parent

Cooperation, Commitment to Joint Venture, Organisational Commitment), together with the results

grained through administration of the SACI to a representative sample (n = 40) of administrative,

managerial and executive staff actively engaged in four differing types of project-based joint

ventures (i.e., Terminal 8, Route 3, MTRC, East Rail) either Onsite or within the Head Office.

Implications of the pertinent and salient results of Study Two, in terms of collaborative-based

practice, are critically presented.

CHAPTER SIX

CONCLUSIONS AND RECOMMENDATIONS

Chapters Four and Five detailed the methodology and results of Studies One and Two in

understanding the organisational and operational culture of project-based joint ventures, in

facilitating knowledge-based competitive advantage between partner companies within the

Hong Kong construction and engineering industry. In Chapter Six the research findings are

summarised and integrated with the relevant research literature. It also gives conclusions,

summarises contributions, make recommendations and state the implications that emerged

from this research, as they relate to the key objectives.

This chapter will now;

• Evaluate the success of the research in achieving the original objectives outlined in

Chapter 1.

• Discuss implications including satisfaction levels and intentions for future joint

ventures between partner companies, (including local and foreign companies) within

the Hong Kong construction and engineering industry.

• Discuss the implications for academic theory, grouped by the associated research

objectives, with conclusions based on empirical testing of theoretically-based

hypotheses.

• Highlight contributions to, and extension of existing knowledge.

• Conclude with recommendations for further research.

6.1 A Restatement of Objectives

This section summarises the results of the key objectives of the research originally proposed:

• Objective 1: To develop an understanding of the organisational culture of project-

based joint ventures in facilitating knowledge-based competitive advantage between

Hong Kong’s local and foreign construction and engineering companies and to

identify the significance of organisational cultural factors that facilitated or inhibited

competitive advantage between partner companies.

Chapter Six: Conclusions and Recommendations

164

• Objective 2: To identify the significance of knowledge transfer, quality of operational

performance and how this is facilitated through developing co-operative relationships.

• Objective 3: To develop a set of measures concerned with organisation culture of

project-based joint ventures in Hong Kong.

• Objective 4: To assess the validity and reliability of measures used in this research

• Objective 5: To develop empirical testing of theoretically-based hypotheses for

Studies One and Two, impact of their outcomes and implications including

acknowledgment of methodological implications of this research

• Objective 6: To show original contribution of findings that enhance research literature

and industry practice.

• Objective 7: To show recommendations for further research

6.2 Achievement of Objectives 1 and 2 :

Study One Conclusions: Based on the significance of inter-company alliances and in light of

the limitations of previous research, this work is original in that limited information exists

regarding the organisational culture of major Hong Kong infrastructure projects existed prior

to now. Further, little is known about how partner companies who participate in such project-

based joint ventures, facilitate knowledge-based competitive advantage, within the Hong Kong

construction and engineering industry. In order to address such concerns and interest, two

separate yet inter-related studies were undertaken.

An exploratory study was undertaken in Study One, in order to investigate the organisational

culture of project-based joint ventures that facilitates knowledge-based competitive advantage

between partner companies. The study entailed face-to-face interviewing with nine senior

executives from five companies who were directly responsible for undertaking large-scale

Hong Kong construction and engineering projects, exceeding US$300 million in estimated

construction cost. The origins of these companies included some who were headquartered

outside Hong Kong. They comprised a French, Japanese, part British, The People’s Republic

of China, and a Hong Kong-owned contracting and engineering organisation. In order to

provide a focus for each interview, respondents were asked to complete a 143-item

questionnaire. This instrument was specifically developed in order for respondents to provide

their understanding of the organisational culture of project-based joint ventures between


165

partner companies within Hong Kong. Interviews were conducted between March and

September 2000.

Due to the limited sample size (n = 9), it is not appropriate to provide either an accurate

detailed or generalised understanding of the inter-organisational and operational culture of

project-based joint ventures between partner companies within the Hong Kong construction

and engineering industry. It is appropriate, however, with exploratory research to provide

senior executives’ deep insights concerning knowledge and perceptions of project-based joint

ventures—as it is frequently regarded as difficult and rare to gain access to this level of

experience within this industry. Hence, the findings of this research provide a useful

framework with which to understand the process of JV partner company interaction in the

attainment of sustainable knowledge-based competitive advantage companies within the Hong

Kong construction and engineering industry.

Overall, the findings of this exploratory research revealed that a purposeful and strategic

design was being undertaken in the management of the inter-organisational and operational

functioning of project-based joint ventures between partner companies within the Hong Kong

construction and engineering industry. Once project-based opportunities were identified, no

single contracting organisation, whether they were local or headquartered overseas, wished to

carry the entire financial risk, nor possessed sufficient knowledge, skills, and competencies

with which to undertake and complete the project on their own.

Furthermore, although the findings of the present research highlighted identified differences

between ‘foreign’ and ‘local’ contractors (in terms of inter-organisational culture, values,

expectations, skills, and dependencies), there tended to be a strong and committed desire

amongst participants in the JV to succeed. However, this depended upon whether the JV

alliance was short-term oriented, or alternatively, whether it could be used for more than one

project.

In addition, JV partner companies sought other benefits through their involvement in project-

based joint ventures with other organisational companies within the Hong Kong construction

and engineering industry. These included sustainable knowledge-based competitive advantage,

(in this context competitive advantage covers such issues as performance, quality, price,

engineering skills, financial strength, site safety, political influence etc), a reasonable return


166

on their investment, as well as increased value towards their company’s shareholders. All

respondents agreed that ethics and governance issues, regarding the inter-organisational and

operational culture of JV’s, were significant factors in the development and nature of any

inter-organisational alliance between partner companies within the Hong Kong construction


Based on the findings of Study One, respondents concurred that organisational compatibility

and the ability to compliment each other in terms of knowledge, technological, and resource-

based assets, between project-based joint venture partner companies, represented important

considerations. Specifically, capacity building,(i.e., access to expanded profits, market share,

opportunities, management expertise, knowledge regarding clients/projects, or new and

diverse technologies) and capability maturity (i.e., inter-organisational trust and organisational

commitment) were considered key aspects of successful joint venture partnership

relationships, in securing sustainable knowledge-based competitive advantage between partner

companies. Hence, it is apparent that the nature and type of ‘strategic fit’ between differing

partner companies remained significant in shaping organisational learning motivation.

Studies One and Two raise a number of important implications in addressing an understanding

of collaborative-based practice within project-based joint ventures amongst partnering

companies in the Hong Kong construction and engineering industry.

Study Two Conclusions: Study Two research findings provided evidence that Cultural

Divergence and Commitment to Joint Venture were found to demonstrate individual

differences in levels of Satisfaction with Joint Venture performance over and above the effects

of other independent variables, such as Organisational Commitment, Inter-Parent Cooperation

,Strategic Fit, Decision Control, Inter-Organisational Trust and Competitive Advantage.

Although it is acknowledged in Study Two that in the contextual findings of this research,

there exist to some extent cultural differences, particularly as ‘Cultural Divergence’ evidenced

a significant relationship to Satisfaction with Joint Venture Performance, it is equally pertinent

to consider the potential of cultural similarities in self-reports which may have existed. For

example, organisations often base subsequent policy and fiscal investment decisions upon the

importance attached to research findings in understanding social phenomena in the corporate

business world as regards the dynamics of project-based joint ventures between multinational

corporations (Ofori-Dankwa & Ricks, 2000).


167

Additionally, within Study Two research, exploratory analysis of variance further revealed

significant mean-related differences among 18 and five of the total 89 items according to Type

of Joint Venture and Respondent’s Relational Status, respectively. More specifically, such

items tended to be related to such salient issues as comprising:

(i) Competitive and strategic goal orientation (i.e., Item 10)

(ii) Expectations regarding joint ventures (i.e., Item 13)

(iii) Expressed inter-organisational and joint venture commitment (i.e., Items 30, 35 71, 72, 75,

77, 78, 80, 82, 85)

(iv) Mutual trust (i.e., Item 38, 53)

(v) Decision making practices (i.e., Item 33)

(vi) Perceived satisfaction with joint venture performance (i.e., Item 34)

(vii)Technological and resource-based expansion in terms of existing levels of assistance (i.e.,

Item 59)

(viii)Fiscal scaling of invested operations (i.e., Item 57).

Accordingly, In Study Two, the nature of the inter-relationships between respondents’ self-

reports and the significance of Organisational Culture and Commitment to the Joint Venture,

suggest a number of important implications, in regard to collaborative-based practice within

the Hong Kong construction and engineering industry:

First, by a correlation of the results of Study Two, demonstrates that as differences in

Organisational/National Culture increased, there were decreases in Inter-Organisational Trust,

Decision Control, Inter-Parent Cooperation, Strategic Fit, Organisational Commitment, and

Satisfaction with Joint Venture Performance.

Second, Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation,

Commitment to the Joint Venture, and Organisational Commitment were positively and

significantly associated with each other.

Third, increases in Competitive Advantage tended to be positively and significantly associated

with both Commitment to the Joint Venture and Satisfaction with Joint Venture Performance.

Hence, Hypotheses One, Three, and Four of Study Two confer with the primacy and

significance of Organisational Culture, together with that of Commitment to the Joint Venture,

in influencing Satisfaction with Joint Venture Performance. The lack of support for Hypothesis

Two, in Study Two, however, suggests that respondents’ self-reports were not influenced by


168

their relational status (i.e., ‘Head Office’, ‘Onsite’), within the project-based joint venture. As

such, it appears that no significant association exists between Organisational Culture and

Commitment to the Joint Venture with respondents’ relational status (i.e., ‘Head Office’,

‘Onsite’). In part, the latter findings may conclude that no significant differences in the

Organisational Culture and Commitment to the Joint Venture of both ‘Head Office’ and

‘Onsite’ project personnel.

Therefore, in light of the insignificant differences in Commitment to the Joint Venture

between ‘Head Office’ and ‘Onsite’ project personnel, this may also conclude that the

commitment of administrative staff in ‘Head Office’ toward the joint venture remained

relatively similar to that of ‘Onsite’ project personnel. Based on the managerial and executive-

related personnel who were sampled, this may account for the failure to find differences

between ‘Head Office’ and ‘Onsite’, in regard to the lack of significant differences in self-

reports by Commitment to the Joint Venture. Study Two shows that although there is little

theoretical or empirical evidence linking Cultural Divergence or Competitive Advantage with

Satisfaction with Joint Venture Performance in the construction and engineering industry of

Hong Kong, significant inter-relationships occurred between these variables. This research is a

new effort to link and measure the relationships between these variables that significantly

affect the performance of JV’s.

Contribution and extension of Knowledge: There is little theoretical nor empirical evidence

regarding the study of organisational culture of major Hong Kong infrastructure projects. Also

little is known about how partner JV companies, including those between local and foreign

companies, facilitate knowledge based competitive advantage, particularly within the Hong

Kong construction and engineering industry. Hence the research into this subject is the first of

this kind and worthy of consideration and further research.

Accordingly, Objectives 1 and 2 has been achieved.


169

6.3 Achievement of Objective 3: To develop a set of measures concerned with

organisation culture of project-based joint ventures in Hong Kong

The measure of the variables in the theoretical framework is an integral part of research.

Unless the variables are measured in some scientific way, one will not be able to achieve an

answer to research issues (Sekeran, 1992).

Study One was designed to develop a fundamental understanding of the cultural drivers and

inhibitors of knowledge-based management practices, in achieving successful project-based

joint ventures and competitive advantage for large scale infrastructure projects in Hong Kong.

To achieve this objective, qualitative field data was used based on information gained through

a structured 143-item questionnaire interview with nine (9) senior executives. These

executives were pivotal in the strategic development and execution of large scale construction

and engineering projects in Hong Kong.

In Study Two, qualitative research was undertaken to further investigate the organisational

culture of project-based joint ventures within Hong Kong. Based on the findings of Study One,

in combination with the relevant research literature, an 89-item “Strategic Alliance

Contracting Inventory” (SACI) was constructed, developed and then validated. The SACI

comprised nine reliable and content measures. These measures defined “indices” of the

organisational culture of project based joint ventures. The administration of the SACI to a

sample (n = 40) of administrative, managerial and executive staff actively engaged in four

differing types of project-based joint ventures (i.e., Terminal 8, Route 3, MTRC, East Rail)

either Onsite or within the Head Office. Implications of the pertinent and salient results of

Study Two, in terms of collaborative-based practice, are critically presented.

Study Two research findings have demonstrated a number of noteworthy findings. First and

foremost, Cultural Divergence and Commitment to Joint Venture were found to uniquely

predict individual differences in levels of Satisfaction with Joint Venture Performance over

and above the effects of other independent variables (i.e., Competitive Advantage, Inter-

Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation, and



170

Pearson product-moment correlation coefficients revealed there were significantly positive and

negative interrelationships in self-reports, independent of the effects of Age of the Alliance

and Number of Inter-Company Partnerships (refer to Subsection 5.2.3.1 and Table 5.12).

Namely, Cultural Divergence tended to be significantly negatively associated with:

(i) Satisfaction with Joint Venture Performance;

(ii) Inter-Organisational Trust;

(iii) Decision Control; and

(iv) Commitment to Joint Venture.

Concomitantly, however, Satisfaction with Joint Venture Performance tended to be

significantly positively associated with:

(i)Competitive Advantage;

(ii)Strategic Fit;

(iii)Decision Control;

(iv)Inter-Parent Cooperation;

(v)Inter-Organisational Trust; and

(vi)Commitment to Joint Venture.

Furthermore, Competitive Advantage tended to be significantly positively associated with

increases in levels of Satisfaction with Joint Venture Performance, as well as related increases

in Commitment to Joint Venture. Moreover, it was also found that Inter-Parent Cooperation,

Inter-Organisational Trust, Strategic Fit, Commitment to Joint Venture, and Organisational

Commitment were all highly and significantly positively interrelated.

Consistent with such findings, Thornhill and Amit (2001) suggest that the internalised degree

of organisational and relational fit (as respectively defined in terms of organisational culture

and structure, or alternatively, through the requisite needs of the project-based venture and

available resources which exist) remain key variables which are likely to subsequently affect

perceived commitment to joint venture. This tends to be through the degree of expressed

organisational congruence and knowledge-based management practices, in terms of the

specified deployment of resources, technological expertise and managerial skill in

coordinating the operational functioning of the joint venture.


171

Further, although it is acknowledged that in the contextual findings of this research, there exist

to some extent cultural differences, particularly as ‘Cultural Divergence’ evidenced a

significant relationship to Satisfaction with Joint Venture Performance, it is equally pertinent

to consider the potentiality of cultural similarities in self-reports which may have existed.

Accordingly, Objective 3, to develop a set of measures concerned with organisation culture of

project-based joint ventures in Hong Kong has been achieved.

6.4 Achievement of Objective 4: To assess the Validity and Reliability of Measures used

in this research

Results are presented in two sections: (i) Internal Consistency (Cronbach’s Alpha) and Study

Two, Item Discrimination of the Strategic Alliance Contracting Inventory (SACI); and (ii)

Descriptive and Inferential Statistics Relating to Relationships and Differences among the

Sample (n = 40).

Tables 5.3 to 5.11 detail the reliability and item discrimination characteristics of each

dependent measure (i.e., Satisfaction with Joint Venture Performance, Cultural Divergence,

Competitive Advantage, Inter-Organisational Trust, Strategic Fit, Decision Control, Inter-

Parent Cooperation, Commitment to Joint Venture, Organisational Commitment). As can be

seen, subsequent examination of the nine dependent measures demonstrated each construct to

be highly reliable (i.e., Cronbach’s Alphas = 0.76 to 0.90), as well as construct validity as

based on the corrected item-total correlations reported in Tables 5.3 to 5.11, which

demonstrate the high level of inter-relatedness of individual items in measuring the same

construct. Validity being based on the Varimax-rotated communality estimates that are greater

than or equal to 0.75 (Lasserre, 1999)

Although it is acknowledged that among some dependent measures [ i.e., Satisfaction with

Joint Venture Performance: Phi = 0.02 to 0.47; Cultural Divergence: Phi = 0.00 to 0.44;

Competitive Advantage: Phi = - 0.18 to 0.05; Inter-Organisational Trust: Phi = - 0.10 to 0.40;

Strategic Fit: Phi = - 0.15 to 0.60; Decision Control: Phi = 0.53 to 0.67; Inter-Parent

Cooperation: Phi = 0.10 to 0.50; Commitment to Joint Venture: Phi = 0.13 to 0.46;

Organisational Commitment: Phi = - 0.05 to 0.50 ], the discriminating power of some items

appeared to be relatively low, insufficient evidence existed with which to justify such aspects

as being reflective of that particular construct. This is particularly true in light of sampling

variability inherent among such a relatively small group of participants (n = 40), and more so,

the satisfactory range of variant item-total correlations achieved with each measure.


172

According to Sekeran (1992), reliability less than 0.60 are generally considered to be poor,

those in the 0.7 range to be acceptable, and those over 0.80 to be good, and the closer the

reliability co-efficient gets to 1.0 the better. ). The nine dependent measures used in this

research demonstrates each construct to be highly reliable (i.e., Cronbach’s Alphas = 0.76 to

0.90).

Accordingly, Objective 4, to assess the Validity and Reliability of Measures used in this

research has been achieved

6.5 Achievement of Objective 5: To develop empirical testing of theoretically-based

hypotheses for Studies One and Two, impact of their outcomes and implications

including acknowledgment of methodological implications of this research

6.5.1 Impact of Study One Qualitative-based Data

Study One was designed to develop a fundamental understanding of the cultural drivers and

inhibitors of knowledge-based management practices, in achieving successful project-based

joint ventures and competitive advantage for large scale infrastructure projects in Hong Kong.

To achieve this objective, qualitative field data was used based on information gained through

structured interviews.

In order to ascertain and investigate key elements of inter-organisational learning which

contributed to the level of success or failure of Hong Kong project–based joint ventures

engaged in the construction and engineering infrastructure projects, an initial pilot study was

undertaken in Study One. Specifically, this initial research focused upon the inherent

motivation of JV partners concerning the organisational design of project-based joint ventures

across differing organisations. Although, this was an exploratory pilot study and results can

not be generalised, such information provided unprecedented insights from those at the most

senior level of the multinational organisations sampled.

Study One was primarily formative in nature, however, the exploratory research provided

valuable insights from those at the most senior level of nine representative multinational

organisations. This was acquired through undertaking individualised structured interviews,

each of approximately two hours in duration. While it is acknowledged that the sample

accessed in Study One involved only interviewing nine participants, those who were

interviewed were senior executives and thus remained pivotal in the strategic development of


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those major construction organisations within Hong Kong. Consequently, although the small

sample size precludes analysis of any cultural dimensions, more extensive investigative

research was subsequently undertaken in Study Two with which to further account for

associated cultural differences in project-based joint ventures in the Hong Kong construction


Structured qualitative interview-based data gained from Study One enabled a valid

understanding to be gained of the nature of inter-organisational learning practices within Hong

Kong’s project-based joint ventures. Hence, the qualitative findings and analysis of interview-

based data from Study One, together with the relevant research literature regarding culturally

diverse multinational corporations, provided the basis to demonstrate the methodological

quantitative-based approach, including an in-depth understanding of the organisational culture

of project-based joint ventures.

The nine senior executives interviewed play a crucial role in the decision making that affects

the activities of the Hong Kong construction and engineering industry. Despite this, it is

acknowledged that the limited number of participants necessitate that the findings be treated

with caution. Research undertaken by Walker (1995) using data gathered from 36 companies

identified a limited list of approved construction and engineering contractors who were

engaged in core infrastructure projects within Hong Kong. Thus, it is suggested, that the nine

participants who participated in Study One constituted a representative sample size of this

initial exploratory research at the time —i.e. approximately 25% of the 36 major contracting

and engineering organisations used by Walker (1995).

6.5.2 Impact of Study Two Quantitative Analysis

Quantitative research was undertaken in Study Two to further investigate the organisational

culture of project-based joint ventures within the Hong Kong construction and engineering

industry in greater detail. The research approach taken was two-fold. First, based on the

findings of Study One, in combination with the relevant research literature, an 89-item

‘Strategic Alliance Contracting Inventory’ (SACI) was constructed, developed, and then

validated. Specifically, the SACI comprised nine reliable and content valid measures. These

defined ‘indices’ of the organisational culture of project-based joint ventures included:


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(i)‘Satisfaction with Joint Venture Performance’ (9 items);

(ii)‘Cultural Divergence’ (10 items);

(iii)‘Competitive Advantage’ (6 items);

(iv)‘Inter-Organisational Trust’ (9 items);

(v)‘Strategic Fit’ (18 items);

(vi)‘Decision Control’ (3 items);

(vii)‘Inter-Parent Cooperation’ (12 items);

(viii)‘Commitment to the Joint Venture’ (6 items); and

(ix)‘Organisational Commitment’ (16 items).

Second, based on the administration of the SACI to a ‘representative’ sample of varying

personnel (n = 40), the relationships between such ‘indices’ of the organisational culture of

project-based joint ventures were then assessed. In Study Two, the sample comprised ‘Head

Office’ and ‘Onsite’ administrative, managerial, and executive personnel. These personnel

were involved in four types of project-based joint venture projects: (i) Terminal 8; n = 3

(7.5%); (ii) Route 3: n = 13 (32.5%); (iii) MTRC: n = 12 (30%); and (iv) East Rail: n = 12

(30%). Differences between the self-reports of ‘Head Office’ and ‘Onsite’ administrative,

managerial and executive personnel, involved in the development, maintenance and

governance of project-based joint ventures, within the Hong Kong construction and

engineering industry were examined, where appropriate.

Study Two self reports

Based on the findings of Study Two, there were no significant differences in self-reports

according to Type of Project-Based Joint Venture, nor by Respondent’s Relational Status (i.e.,

‘Head Office’, ‘Onsite’). There were, however, significant inter-relationships between the

Dependent Variable (i.e., Satisfaction with Joint Venture Performance) and the seven

Independent Variables (i.e., Cultural Divergence, Competitive Advantage, Inter-

Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation, Commitment

to the Joint Venture, Organisational Commitment). Furthermore, with the exception of the

significant and positive relationship between Age of the Alliance (Years) and Organisational

Commitment (r = 0.37, p < 0.05), Bivariate Pearson product-moment correlations revealed that

respondents’ self-reports were not significantly related according to Age of the Alliance

(Years), nor by the Number of Inter-Company Partnerships.


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Study Two Variance Analysis

Analyses of variance revealed item-related differences among each of the nine measures of the

SACI, according to Type of Project-Based Joint Venture and Respondent’s Relational Status

(i.e., ‘Head Office’, ‘Onsite’). In the methodological design of Study Two, it is acknowledged

that reported differences were found in respondents self-reports, and that respondents’ national

and/or organisational culture whilst not adequately controlled. did not necessarily imply

organisational and/or national cultural differences. Tan, 2002 suggests that this is because both

organisations and nations tend to represent distinct political institutions, which are influenced

in turn by their own distinct socio-cultural and economic influences.

In the context of this research, it may be argued that a respondent who endorsed a particular

response to an item may have evaluated and interpreted the ‘subjective’ meaning of such an

item quite differently from that of another who was of a different organisational and/or

national culture. Hence, due to the apparent methodological limitations of the present research,

discerning whether respondents endorsed particular items on the basis of organisational and/or

national culture tends to remain largely unclear.

Further, in regard to the additional findings of Study Two, Stepwise Multiple Regression

revealed that ‘Cultural Divergence’ and ‘Commitment to the Joint Venture’ uniquely

accounted for the Dependent Variable, ‘Satisfaction with Joint Venture Performance’. Of

particular importance, however, was that ‘Cultural Divergence’ and ‘Commitment to the Joint

Venture’ uniquely account for variance in levels of ‘Satisfaction with Joint Venture

Performance’, over and above the effects of other Independent Variables.

Finally, Hierarchical Multiple Regression demonstrated that there was a significant interaction

between ‘Cultural Divergence’ and ‘Commitment to the Joint Venture’ in predicting levels of

‘Satisfaction with Joint Venture Performance’.

6.5.3 Study Two Hypotheses Testing

In the testing of specific research hypotheses within Study Two, the following can be

concluded:


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• Hypothesis One which stated that “respondents’ self-reports of Satisfaction with Joint

Venture Performance, Cultural Divergence, Competitive Advantage, Inter-

Organisational Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation,

Commitment to Joint Venture, Organisational Commitment will be significantly inter-

related” was supported.

• Hypothesis Two which stated that, “differences in respondents’ self-reports will be

influenced according to Type of Joint Venture and Relational Status (i.e., Head Office

and Onsite Project Management)” was not supported.

• Hypothesis Three which stated that “Cultural Divergence and Commitment to Joint

Venture will make significant unique contributions in differentiating Satisfaction with

Joint Venture Performance, relative to Competitive Advantage, Inter-Organisational

Trust, Strategic Fit, Decision Control, Inter-Parent Cooperation and Organisational

Commitment” was supported.

• Hypothesis Four which stated that “the interaction of Cultural Divergence and

Commitment to Joint Venture will significantly influence levels of Satisfaction with

Joint Venture Performance” was supported.

6.5.4 Conclusions: Although the findings of the present research add to existing knowledge

concerning the organisational culture of Hong Kong project-based joint ventures, in

facilitating knowledge-based competitive advantage between partner companies, several

methodological concerns must be acknowledged.

First, retrospective and cross-sectional methodology was used in Studies One and Two. In

Study One, based on guided and focused interview questions, respondents were asked to recall

and evaluate their understanding of the inter-organisational and operational culture of project-

based joint ventures between their partner companies in the Hong Kong construction and

engineering industry. In Study Two, using developed instrumentation, respondents were

instructed to assess and evaluate the inter-organisational and operational culture of project-

based joint ventures within the last 24 months. This time duration was used in order to gather

an adequate sampling of self-reports.


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As the methodology of Studies One and Two was retrospective in nature, the reliability of

such data in this research depended on respondents’ ability to accurately recall prior and

concurrent events or experiences of the inter-organisational and operational culture of project-

based joint ventures between partner companies at a single point in time. Although the

reliability (i.e., under or over-reporting) of retrospective protocols have received critical

review (Shiffman, Hufford, Hickcox, Paty, Gnys, & Kassel, 1997), concerns regarding the

reliability of retrospective, in contrast to concurrent self-report data, often tend to be grossly

exaggerated (Van de Vijver & Leung, 1997, 2000).

Second, passive (i.e., informed consent) rather than active consent procedures (i.e., deliberate

coercion) were used to recruit all research participants. Further, only self-selected participants

volunteered to participate in this research. Specifically, the interviewee sample recruited in

Studies One and Two were accessed through the researcher’s professional associations with

executive, managerial, and administrative colleagues, who are employed within a number of

construction and engineering companies in Hong Kong. Appropriate ethical standards were

strictly maintained at all times, with due adherence to statutory, institutional, and professional

directives that necessitate the need for informed consent. Moreover, as research participation is

always voluntary, examining differences in the self-reports of volunteers relative to non-

volunteers, seems contrary to the aims of the present research (Rosnow & Rosenthal, 1997).

Although sampling bias has the potential to undermine and threaten the validity of research

data (Roberts, 1997; Nasif, Al-Daeaj, Ebrahimi, & Thibodeaux, 1991), the selective and

purposeful sampling of participants in the present research is warranted for a number of

reasons. According to Lim and Firkola (2000), project-based management research tends to be

characterised by the relative preponderance of opportunistic and non-independence of

sampling. Given such methodological limitations, it is important that the selection of potential

research participants is based upon specific and targeted groups of individuals, in line with the

specific purposes of the research. Hence, in understanding the inter-organisational and

operational culture of project-based joint ventures within the Hong Kong construction and

engineering industry, the selective and purposeful sampling of participants in the present

research is warranted.

Third, a measure of social desirability was not used in the present research. Individuals can

and do actively fake their self-reports, in order to create a favourable or unfavourable


178

impression of themselves, or some other construct, when instructed. However, insufficient

evidence exists to affirm that social desirability compromises the response validity of self-

reports (Barrick & Mount, 1996; Ones, Viswesvaran, & Reiss, 1996). Furthermore, social

desirability ‘corrections’ for respondents, who have been instructed to purposefully ‘fake

good’, remain ineffectual in that their resultant ‘corrected’ scores are often similar to those of

‘honest’ respondents (Dwight & Alliger, 1997). In support, based on a meta-analytic review of

61 studies (1967 – 1997; 673 Effect Sizes), Richman, Kielser, Weisband, and Drasgow (1999)

found that social desirability response bias was minimal among varied paper-and-pencil

instruments, particularly when respondents were alone and anonymous, hence reducing the

evaluation apprehension of respondents.

Despite the use of retrospective methodology, voluntary participation, and the absence of a

social desirability measure, satisfactory reliable and valid data have been gathered in this

research. In light of such methodological limitations, however, it is paramount that future

research efforts develop a rigorous and detailed understanding of situationally specific factors,

which may be important in project-based joint ventures between differing partner companies.

This is because such identified factors may be significant in affecting the collaborative nature,

efficiency and effectiveness of management practices and interorganisational learning, and

hence the overall development of sustainable competitive advantage, between differing partner

companies (Luo, 2002c; Robson, Paparoidamis, & Ginoglu, 2003; White 2002).

Accordingly, Objective 5, developing empirical testing of theoretically-based hypotheses for

Studies One and Two, including examining the impact of their outcomes, implications

including acknowledgment of methodological implications of this research, has been achieved.

6.6 Achievement of Objective 6: To show original contribution of the findings with the

relevant research literature and contribution to industry practice

The establishment of project-based joint ventures, represents a strategic response which has

remained with humanity, since the discovery that banding together in order to survive was a

useful form of cooperation for mutual benefit (Moore & Lewis, 1999). Arguably, this

behaviour resides at the foundation of society’s success in successfully and efficiently

accomplishing complex infrastructure projects.


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Respondents’ national and/or organisational culture was not adequately controlled in the

design of Study Two, but differences found in respondents’ self-reports, did not necessarily

imply organisational and/or national cultural differences. Social comparison theory suggests

that individuals are more likely to evaluate and rate Likert-type items, based on their

organisational and/or national cultural background and values (Heine, Lehman, Peng, &

Greenholtz, 2002; Peng, Nisbett, & Wong, 1997). Hence, due to the apparent methodological

limitations of the present research, discerning whether respondents endorsed particular items

on the basis of organisational and/or national culture tends to remain largely unclear.

Joint venture partners bring with them certain competencies including their technical, business,

cultural, political, and other areas of expertise. The JV forms to fill gaps in competencies to

fulfil the project need, but not all JVs will necessarily have the requisite cultural competencies.

Figure 6.1 illustrates the implications of the research findings.

JV1 CompetenciesJV1 Competencies

……..JVn Competencies

Cultural Filter 1 > Capacity to:• Respond

• Explore, challenge and accommodate• Learn and adapt world views

• Shape and align• Strategise and make decisions.

Cultural Filter 2 > Willingness+ ability to:• Understand different world views

• Empathise with JV partners’ values• Communicate and negotiate

• Trust• Commit to win-win solutions

• Align values

The key—Cultural filter application effectiveness

TechnicalBusiness

CulturalPolitical

Etc….

Extent of match betweencultural Filters 1 + 2 andtheir effective application

JV and Project Success > Multiple criteria:• JV cultural values alignment leading to project success commitment

• JV satisfaction with the relationship• Client stakeholder satisfaction• JV partner learning outcomes

• JV partner sustainable competitive advantage

Figure 6.1 Model of Thesis Conclusions


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This condition imposes a kind of valve of limiting mechanism on effectiveness. This can be

seen as the interaction of two filters, where one filter has the collective and specific JV cultural

capacity to use cultural divergence as a positive driver that enhances learning through empathy

and exercising an ability to challenge stereotypical approaches to problems that are culturally

(nationally or organisationally) anchored. This capacity filter determines the ability or capacity

to challenge and accommodate, shape and align, and strategise or make operational decisions.

A second filter operates at the level of converting the capacity to bring these things into action

through willingness and ability. Thus, on the one hand there needs to be a capacity and on the

other hand the ability and motivation. These two elements form the valve that results in the

outcome—depending upon how open these valves are positioned. The valve action is the key

to effectiveness of the JV relationship and its outcomes. Depending on the degree of matching

of capacity with willingness and action, the degree of project success will follow. As

illustrated in Figure 6.1, project outcomes and performance can be measured along a range of

metrics. This figure summarises this thesis’s findings from both Study One and Study Two.

First, central to the theme of this research, in understanding collaborative-based practice,

within the Hong Kong construction and engineering industry, were organisational/national

culture and the concept of sustainable competitive advantage. As evidenced by the findings of

Study One, the organisational culture of participating companies was defined in terms of the

shared values, which underlie and seek to determine the work-related behaviours of staff, in

applying rules and procedures to solve problems and work towards solutions. Specifically,

such aspects of organisational culture which were assessed, included: identifying what project-

based joint venture partners wanted (i.e., expansion, maintenance, synergy); (ii) identifying

vulnerability/risk factors and trust/commitment concerns; and (iii) the manner in which they

planned to achieve their aims in order to achieve the objectives which satisfied their clients’

project-related needs (i.e., organisational and operational foci).

Further, more specifically, a distinction was made in the context of this research between

‘local’ and ‘foreign’ (overseas) contractors within the Hong Kong construction and

engineering industry. Whereas ‘local’ contractors represented those companies who were

‘indigenous’ to Hong Kong, the term ‘foreign’ was used to refer to those who had their

headquarters in another country, outside Hong Kong. In addition, sustainable competitive

advantage was defined in this research as the exchange and transfer of organisational

technology and knowledge-based assets and resources, with which to succeed and thus


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outperform rival companies, in terms of business profitability, efficiency and effectiveness,

within the marketplace.

Study One respondents affirmed that companies engaged in project-based joint ventures with

other partnering companies sought to ‘harmonise’ their organisational knowledge, skills, and

technological-based competencies. Specifically, this was undertaken in order for companies to

enhance and consolidate their competitive position within the marketplace through

organisational learning in the attainment of sustainable competitive advantage. These findings

confirm that companies collaboratively seek to ‘bridge’ acknowledged gaps, specifically in

terms of their perceived capacity to provide goods and/or services to secure and establish

mutual competitive advantage (Bowman, Singh, & Thomas, 2002; Cool, Costa, & Dierickx,

2002).

In part, inter-company partnerships allow companies to offer a customer-focused service

package that meets the diverse needs of varied clientele (Danneels, 2003). Other supporting

reasons, however, include bridging knowledge and expertise gaps; sharing risk; and exploring

opportunities with which to attain mutual and sustainable competitive advantage, through

collaboration in the form of inter-company partnerships (Huang & Newell, 2003;

Schlegelmilch, & Chini, 2003). In line with the inherent competitiveness of the Hong Kong

construction and engineering industry, companies require salient technology and knowledge-

based resources, skills, capabilities, and expertise through collaborative activity with other

partner companies (Walker, 1995).

As such, joint venture arrangements between partner companies, which entail sharing

organisational risk, technological uncertainty, and reward, appear to represent an effective

response in enhancing existing levels of resource and technological-based skills (Raz, Shenhar,

& Dvir, 2002). The achievement of sustainable competitive advantage through project-based

joint ventures, creates an awareness of how the exchange and transfer of organisational

knowledge and learning may occur, how it may be used; and to what extent represents highly

significant strategic considerations, particularly in regard to the differing organisational and

national culture of partnering companies (Berrell & Gloet, 2000; Eisenhardt & Santos, 2002).

For example, organisational and national cultural differences, in terms of partner company

nationality (i.e., ‘country-of-origin’), shareholder affiliation, or alternatively, because the

project-based joint venture is being undertaken in emerging business markets within a


182

‘foreign’ geographic locality, are likely to impact upon the organisational functioning,

competitive performance and success of inter-company partnerships (Hanvanich, Miller,

Richards, & Cavusgil, 2003; Yan & Zeng, 1999). Moreover, perceived differences in the

national cultural values, beliefs, and work practices of managerial staff, in ways of

communicating, decision-making, and conflict management, may also have a significant

influence in facilitating or inhibiting the cooperative exchange and transfer of organisational

knowledge between partner companies (Cheung & Chow, 1999; Pearson & Entrekin, 2001;

Swierczek, 1994).

Most notably, Buckley, Glaister, and Husan (2002) acknowledge the critical importance and

saliency of mutual obligation, trust, respect, and reciprocity between partner companies,

specifically through the cooperative and coordinated management of staff, partner companies,

and the joint venture itself. In order to ensure mutual competitive advantage between partner

companies, therefore, there needs to be equitable consultation in decision-making processes

and practices in ensuring that there remain cooperative inter-company relationships. In turn,

this reinforces the importance and significance of inter-organisational trust, organisational

commitment, as well as the commitment of partner companies towards the successful

attainment of the mutual and shared (or strategic) objectives and goals of the joint venture.

6.6.1 Conclusion: In line with a resource-based view of sustainable competitive advantage,

therefore, inter-company partnerships provide companies with extended opportunities for

organisational learning through the integration of complementary knowledge and

technological-based resources, as well as through the development of new organisational

competencies (Harrison, Hitt, Hoskisson, & Ireland, 2001). Although the existence of

complementary resources, through the development and establishment of inter-company

partnerships, is a necessary pre-requisite in the attainment of sustainable competitive

advantage, it is not sufficient by itself. Greater understanding of organisational culture

between differing partner companies, is required in order to facilitate and enhance the

integration of complementary organisational resources, through effective and efficient

management and sustainability of the inter-company alliance.


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Contribution to Industry Practice and Knowledge

An original contribution was achieved. This is the first time that the depth of insights and data

on this topic, has been obtained from selected Hong Kong companies and a select few of

senior executives involved in project-based joint ventures in the construction and engineering

industry. This is also an emerging area of study with few examples of findings from similar

studies undertaken of this kind of construction and engineering projects in this geographical

area.

The research also demonstrates a high level ability in designing and undertaking a significant

research project, which included research design, data gathering and rigorous analysis. The

results of which were summarised and evidence presented at international conferences and

internationally-peer reviewed papers, as shown in Appendix H.

Accordingly, Objective 6 was achieved showing original contribution of the findings with the

relevant research literature and contribution to industry practice

6.7 Recommendations for Further Research

This research opens up exciting areas for further work, such as:

• Clarifying the still largely unclear issue of discerning whether respondents endorse

particular views on the basis of organisational and/or national culture.

• Investigating how mitigating variables influence the multidimensional constructs of

joint venture performance and subsequent joint venture success within and across

differing organisations involved in strategic and collaborative partnerships. Case study

work could greatly assist in empowering managerial and executive-level staff to

develop and refine more culturally appropriate knowledge-management and

organisational learning practices, within the context of project-based construction joint

ventures in Hong Kong


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• Establishing new links to measures the relationship between Cultural Divergence or

Competitive Advantage with Satisfaction with Joint Venture Performance in the

construction and engineering industry of Hong Kong. These variables may

significantly affect the performance of JV’s in Hong Kong.

• Examining how ‘foreign’ and ‘local’ construction companies culturally interact to

build capacity for competitive advantage to address market potential in Mainland

China

• Building on the research initiative provided by a broader population. The small sample

of participants in Study One and companies in Study Two restricts the strength of

arguments that formation of alliances promotes competitive advantage between

companies.

• Exploring the relevance of joint ventures in the current difficult economic climate in

Hong Kong with declining infrastructure budgets and companies consequent desire to

“go it alone”

• Questioning whether cultural dynamics should or will be given a lesser priority when

dealing with foreign countries and companies with non-Asian origins, given the

emergence of Asian countries economic strength.

• Investigating how filters 1 and 2 in Figure 6.1 can be further studied as in-depth

qualitative ethnographic studies of several projects, similar to those under

investigation in the present study. If this approach were investigated, then the

interesting results reported in this study in Chapter Five, particularly those item results

shown in bold font, or highlighted in boxed text in Tables 5.3 to Table 5.11

inclusively, could be explored more fully, to unearth a wider variety of evidence and

data that may help in understanding the cultural drivers and inhibitors. Such a study

was beyond the scope of this present work.

According to Phillips and Pugh (1994), the degree of Doctor of Philosophy (PhD) entails the

operational and conceptualisation of a particular research area in order to address identified


185

gaps in existing levels of theoretical knowledge regarding a specific field. Consequently, the

purpose and significance of PhD research, involves making a significant and original

contribution to the field through informed and deliberate process of gathering and analysing

relevant data which is likely to aid in empowering business and managerial-related practice.

This criteria has been demonstrated by this thesis and the research work that it is based upon.

First, an original contribution is required. This work is original because it is the first time that

the depth of insights and data on this topic, has been obtained from selected Hong Kong

companies involved in project-based joint ventures in the construction and engineering

industry. Additionally, this is an emerging area of study with few examples of findings from

studies undertaken of this kind of construction and engineering projects in this geographical

area. The second criterion clearly demonstrates a high level ability in designing and

undertaking a significant research project. The research design data gathering and its rigorous

analysis clearly demonstrate these skills. Third, the thesis must be publishable in part.

Appendix H summarises evidence of internationally peer-reviewed papers, which were

published from this work.

6.8 Closure This research sets out to develop a cultural understanding of how joint ventures provide

construction and engineering companies in Hong Kong with a competitive advantage in

undertaking construction infrastructure projects. Where appropriate, the significance and

identification of organisational cultural factors that facilitated or inhibited a competitive

advantage were investigated. More specifically, the research concentrates upon knowledge

transfer, quality of operational performance and how these are facilitated through developing

cooperative relationships.

In answering these questions, this research developed a validated measurement framework to

allow knowledge-management practices within the Hong Kong construction and engineering

industry, to consider the importance of organisational culture in the attainment of sustainable

competitive advantage, through the exchange and transfer of knowledge-based assets and

resources between partner companies, whether they be local of foreign headquartered

companies. Further, in line with the results of Study Two, a broad validated framework was

developed, covering differences in organisational/national culture and commitment toward

joint ventures that significantly influence satisfaction with joint venture performances. The


186

impact and influence of differences in organisational culture upon the establishment,

development and maintenance of inter-organisational trust, decision control, inter-parent

cooperation, strategic fit, organisational commitment, and thus satisfaction with joint venture

performance, in ensuring sustainable competitive advantage, cannot be underestimated.

This research made contributions to both the academic community and the Hong Kong

construction and engineering industry. The publication of a number of articles using some of

the raw data from both Studies One and Two has generated interest among academics

examining competitive advantage issues. Its major contribution in the Hong Kong construction

and engineering industry is that it offers companies a mechanism for better understanding the

potential in gaining competitive advantage amongst partner companies.

This research concludes with a discussion on the implications on the increasing

interdependence of, and between companies. The importance of effective networking and

communication within, and across, companies involved in collaborative partnerships, needs to

be considered in order for sustainable competitive advantage to be achieved within the Hong

Kong construction and engineering industry.

180

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APPENDICES

Appendix A: Glossary of Terms and Abbreviations Used Within the Thesis.

General Terms Used Within the Text (Listed Alphabetically)

Term


Build Own and Operate

(BOO), Build Operate and

Transfer (BOT), and Build

Own Operate and Transfer

(BOOT) Projects

Wherein one or more private sponsors, most notably,

contractors engage in financing, designing, building and

operating the project in partnership for a concessionary

period of time in seeking to return a profitable outcome

on the initial capital investment before subsequently

deciding to either maintain or transfer ownership of the

project to an alternative granting authority.

CEO Chief Executive Officer of a Multinational Organisation

or Joint Venture.

Collaborative Relationship Relationship wherein two or more parties work together

to achieve a common and purposeful goal or outcome.

Competitive Advantage Competitive advantage in this research context covers all

or some of the following areas; performance quality,

price, technologies used or available, engineering skills,

financial strength, site safety, speed of delivery,

personable manner of employees, geographical location

and political influence.

Decision Control The process for making and controlling power decisions

between companies and within joint ventures

230

Appendix A (Continued)

Foreign Contractor Contractor with its headquarters located outside Hong

Kong, notwithstanding its local approval status

Joint Venture (JV) Engaged process wherein locally managed or indigenous

subcontractors undertake much of the construction work

in infrastructure projects.

Knowledge Management

(KM)

Management of the process creating, developing,

codifying and coordinating, transferring, and applying

knowledge

Local Contractor Contractor with its headquarters located in Hong Kong

Organisational Learning

(OL)

The process of organisations systematically embedding

lessons learned and absorbing knowledge from both

external and internal sources so that they become more

aware of what they know and are in a better position to

benefit from knowledge.

Strategic Alliance Inter-firm relationship wherein the short-term and long-

term goals of the partnering firms are jointly defined in

seeking to identify organisational directions in which to

proceed in order to achieve sustainable competitive

advantage.

(SACI) Strategic Alliance

Contracting Inventory

The development of a reliable and validated Strategic Alliance

Contracting Inventory (SACI) research instrument,

administered to a representative sample of 40 respondents

Methodological and Statistical Terms Used Within the Text (Listed Alphabetically)

Term


Cronbach’s Alpha Coefficient of the reliability or internal consistency of a

theoretical construct.

Dependent Variable Measure of the allocated effect of independent variables.

231

Appendix A (Continued …)


(Continued …)

Term


Df Degrees of Freedom associated with a statistical

calculation. For example, a dataset with n observations

has n – 1 degrees of freedom.

Effect Size Measure of the strength and magnitude of relationship, as

defined by the difference between two sample means and

divided by the pooled standard deviation

F (or F-ratio) Ratio of two sample variances (each associated with

individual degrees of freedom or ‘df’ values), as based on

the F distribution [ e.g., F (df = 8, 13) ]

Factor Analysis Statistical procedure designed to reduce a large number

of correlated variables to a smaller more manageable

number of factors

Hierarchical Multiple

Regression

Statistical procedure which differs from that of Multiple

Regression in that the researcher predetermines the

ordering of variables into the Regression equation, either

based on logic and/or theoretical considerations.

Independent Variable Variables which the researcher controls or manipulates,

as consistent with the purposes of the research

investigation

232



(Continued …)

Term


Item Discrimination Indice

(or Phi)

Item analytic technique designed to determine how well

each item distinguishes between respondents who

reported either low or high scores on a particular

measures.

Level of Significance Definition of an unlikely sample result as expressed in

probability terms. For example, a significance level of

5% refers to the accuracy of results having a 5% or less

chance of being incorrect.

Multivariate Analysis of

Variance (MANOVA)

Statistical procedure which studies effect of nominal

independent variables on two or more dependent

variables.

One-way Statistical analysis based on one independent variable

(e.g., Type of Enquiry (3 levels) – Email, Letter, Private

Solicited Contacts).

P (or P-value Probability of making a Type I error in accepting the

research hypothesis when it is in fact false based on a

particular probability level, as specified by the researcher

in determining the statistical significance of resultant

findings. For example, a P-value of 0.05 indicates that

the researcher is likely to be

233



(Continued …)

Term


Post hoc Multiple comparison procedure used to determine which

means differ significantly after a significant F-ratio has

been found.

Statistical Power Rejection of the research hypothesis when it is in fact

false.

Stepwise Regression Considered the most conservative and best approach to

prediction of a specified dependent variable through

complimenting aspects of both Forward Selection and

Backward Deletion

Tukey HSD (i.e., Honestly

Significant Difference) Test

Following a significant F-ratio in ANOVA, post-hoc

multiple comparison procedure designed to make all pair

wise comparisons of cell means while maintaining the

experiment wise error rate at the pre-established level of

Alpha (e.g., 0.05)

Type I Error (Experiment

wise)

Rejecting the research hypothesis when it is true, of

which the probability or “α” of committing a Type I error

is equivalent to the nominated significance level which is

usually between 1% and 10%.

234



(Continued …)

Term


Type II Error (Experiment

wise)

Not rejecting the research hypothesis when it is false; the

probability of committing a Type II error being defined

as “1 - α”

Two-way Relates to an analysis involving one dependent and two

independent variables e.g., Type of Joint venture (4

levels) and Respondent’s Relational Status (2 levels)

Univariate Analysis of

Variance (ANOVA)

Statistical procedure which studies effect of nominal

independent variables on continuous dependent variable.

235

Appendix B: Structured Interview Questions Used in Study One.

(A) Creating Value and Identifying New Opportunities

1 Does each partner seek to gain strong competitive capabilities through forming a JV/Alliance ?

Not important 1 2 3 4 5 6 Very important

2 Does JV/Alliances have expectations to leverage joint resources between partners to exploit new opportunities ?

Low expectations 1 2 3 4 5 6 High expectations

3 Is gaining competence important - both to remedy skill deficits and to develop new competencies for the future, or through learning internally within the JV and JV/Alliance partners ?


4 Does JV/Alliance partners seek to create value and better profits for its shareholders ?


5 In a JV/Alliance do you seek to improve/enhance the value of the alliance ?

Not really 1 2 3 4 5 6 Most definitely

236

Appendix B (Continued …)

(B) Reviewing Key Issues when developing New Relationships through JV/Alliances

How focused is your marketing/business strategy ?

1 Defensively, in your existing markets ?

Continuously 1 2 3 4 5 6 Strongly

2 Offensively to penetrate new markets ?


What are the key issues you look at ?

3 Size in turnover/number of employees ?

Not important 1 2 3 4 5 6 Important

4 Scale in operations (manufacturing, R&D, processing, logistics) ?


5 Share of customer attention, customer access ?


6 Density of coverage locally for service and competitive advantage ?


7 Reach of coverage globally ?

Not relevant 1 2 3 4 5 6 Relevant

8 Brand, reputation, corporate image, credibility ?


9 Do you observe/expect several rival JV's being formed to provide competing services ?

Unlikely 1 2 3 4 5 6 Likely

10 The formation of new JV's to ally with the most critical providers of complementary products, market access, unique "gateway" technologies or infrastructures ?

Not a concern 1 2 3 4 5 6 Concerns you

237


(B) Reviewing Key Issues when developing New Relationships through JV/Alliances

11 If you try to build a JV alliance, do you make yourself attractive to partners ?

No effort 1 2 3 4 5 6 Make an effort

12 What uniqueness do you bring ?

None 1 2 3 4 5 6 Some Uniqueness

13 How are assurances for potential fears of dependence on the part of partners ?

Not critical 1 2 3 4 5 6 Very critical

If you join a JV/Alliance as a minority player with a strong leader - are your expectations and risks reduced ?

14 Reduced risks 1 2 3 4 5 6 Great risks

15 Reduced expectations 1 2 3 4 5 6 Greater expectations

16 When you are the minority partner does your dependence on the JV sponsor partner becoming overly dependent on the JV sponsor lead partner ?

Reduced dependence 1 2 3 4 5 6 Increase dependence

17 How do you assess that you have the "right" set of partners in the JV/Alliance ? Do you constantly set the partners to pass without them knowing ?

No, never 1 2 3 4 5 6 Yes, sometimes

18 Are you able to influence the leaders of the JV/Alliance in their decision making process ?

Occassionaly 1 2 3 4 5 6 Yes, mostly

19 If you were perceived as a weak minority partner, would you allow the stronger JV partner to set the pace, do as he pleases without to much interference

Unlikely 1 2 3 4 5 6 More than likely

238


(C) Creating Value by sharing Special Contributions/Relationships in JV/Alliances

1 Is it a superior arrangement when a partner can make unique contributions such as enhanced competencies, have good government contacts and “insider” status, that cannot be traded easily between companies ?

Not really 1 2 3 4 5 6 Highly desirable

2 Is it desirable to have a partner making unique contributions that cannot be substituted ? For example, there is no alternative partner and/or no alternative source for the contribution.


3 Is it desirable to have a partner making unique contributions that cannot be developed or copied independently within a reasonable time frame ?

Not necessary 1 2 3 4 5 6 Highly desirable

(D) Creating Value through Learning and Improving Ones Skills and Dependencies

If skill gaps were identified within your company, how would you address them:

1 Get involved with a more experienced company.

Likely 1 2 3 4 5 6 More than likely

2 Purchase these skills by hiring the right people.


3 Licensing appropriate/new technologies


4 Does your company have adequate capabilities and skills to harness for the future ?

Inadequate 1 2 3 4 5 6 Adequate

5 Do your JV partners possess specialised capabilities and skills ?

Inadequate 1 2 3 4 5 6 Adequate

6 Will your partners be willing to share them with you ?

Willing 1 2 3 4 5 6 Unwilling

239


(D) Creating Value through Learning and Improving Ones Skills and Dependencies

If skill gaps were identified within your company, how would you address them:

7 Does your dependence on a JV partners concern your company ?

Concerned 1 2 3 4 5 6 Unconcerned

8 Do you need to learn these capabilities and skills yourself if you don't want your bargaining power in the JV/Alliance to become weak and your position thus precarious ?

Do not need to learn 1 2 3 4 5 6 Do need to learn

9 If the required capabilities and skills are new, how much can you benefit from developing them jointly with partners (for example, in an engineering/construction B120 environment) ?

Not much 1 2 3 4 5 6 Greatly

10 As you plan your strategies (and technology road maps) for the next 5 years, have you considered a number of alliances with different partners allowing you to access the range of required capabilities and skills over this period ?

No consideration 1 2 3 4 5 6 Yes, serious consideration

11 Does your organisation face skill gaps ?

Not really 1 2 3 4 5 6 Yes, sometimes

12 Are your partners’ skills very different from yours ?


13 Do your partners have areas of competence that you don't understand, and vice versa ?


14 Does the JV partners organisation, business processes, and work practices of your partners reflect the nature of their skill base ?

No reflection 1 2 3 4 5 6 Yes, it does reflect it

15 How interdependent and interlinked are the various areas of skills, both for your partners and for your partners and for your organisation ?

Not really interlinked 1 2 3 4 5 6 Very interlinked

240


(E) Assessing JV/Alliance Partner Compatibility

Understanding each other's positions and ambitions

1 Do you try to understand the respective, competitive positions of the partners other core business activities ?

Try to understand 1 2 3 4 5 6 Don’t care about other partners

2 Do you understand the strategic stakes of your partners in the JV/Alliance ?

(a) Do understand 1 2 3 4 5 6 Have no means to understand

(b) Do understand 1 2 3 4 5 6 Make no effort to understand

3 As market rivals, do you seek to neutralise your JV partner in one or more other markets where you are competitive ?

Not a consideration 1 2 3 4 5 6 A serious consideration

4 As JV partners are you likely to converge toward the same competitive space outside the alliance ?

Unlikely 1 2 3 4 5 6 Highly likely

5 If partners are market rivals in the same industry, how can one characterize the status of each in the construction/engineering industry:

leader challenger laggard newcomer

(a) Nishimatsu

(b) Dragages/Bouygues

(c) Costain

(d) Zen Pacific

(e) China Harbour

(f) Gammon Construction

6 Do you need to understand the strategic ambitions of the various partners ?

Not necessary 1 2 3 4 5 6 Necessary

7 Do partners seek to use the alliance to improve its status in the industry ?

Yes, sometimes 1 2 3 4 5 6 Always

241




8 Are you content with your present position in the market ?

Not satisfied 1 2 3 4 5 6 Very satisfied

9 Have you considered the alliance to be means to allow you to phased exit from a market loss making sector ?

Never 1 2 3 4 5 6 Has been considered

10 Is there a risk that you may misread the strategic ambitions of your partners because you implicitly assume they are like you ?

Unlikely 1 2 3 4 5 6 Sometimes

11 Do you consider the JV/Alliance from your partner’s perspective, given their stakes, ambitions, and market positions ?

Very seldom 1 2 3 4 5 6 Always a consideration

How seriously do you consider risk taking and risk sharing by each partner within a JV/Alliance

12 Risk Taking ? Not seriously

1

2

3

4

5

6

Very seriously

13 Risk Sharing ? Not seriously

1

2

3

4

5

6

Very seriously

14 Do you consider trust an important issue when looking at a new JV/Alliance ?

Not seriously 1 2 3 4 5 6 Most seriously

15 Do JV partners need to be compatible in relation to their respective competitive positions ?

Not necessary 1 2 3 4 5 6 Most definitely

16 How compatible are JV/Partners’ strategic ambitions ?

Not very 1 2 3 4 5 6 Very ambitious

17 Are partners who hold similar positions, prepared to share the same ambitions with their competitors ?

Not normally 1 2 3 4 5 6 Normally, yes

242




18 How acceptable is mutual dependence on a JV partner ?

Not acceptable 1 2 3 4 5 6 Highly acceptable

19 Are the partners sufficiently differentiated to make sufficiently unique and sustainable contributions to the alliance to endure the duration ?

Not normally 1 2 3 4 5 6 Yes, most definitely

20 Is your commitment to the alliance unquestioned ?

Not strongly 1 2 3 4 5 6 Strongly

21 Is compatibility between partners likely to improve or to deteriorate over time ?

Decline 1 2 3 4 5 6 Improve

22 If you are a leading company in a JV/Alliance, are you sure you do not show misplaced attitude and arrogance in dismissing weaker partners ?

Never 1 2 3 4 5 6 Sometimes, yes

23 Might you not be surprised by their ambitions ?

Not really 1 2 3 4 5 6 Sometimes, yes

24 Do you risk mistaking ambitions for energy and drive ?

Not possible 1 2 3 4 5 6 Highly likely

25 Are you willing to help your partners improve their competitive position ?

Not really 1 2 3 4 5 6 Possible

26 If you are a newcomer or challenger, how realistic are your ambitions ?

Low expectation 1 2 3 4 5 6 High ambitions

27 Would you accept continued dependence on your partners ?

Never 1 2 3 4 5 6 Sometimes, yes

243




28 Are there areas where you challenge this dependence, likely to be acceptable to your partners ?

Unlikely to be acceptable 1 2 3 4 5 6 Acceptable

Would you be prepared to compromise changes in a JV to make things more palatable to partners involved …

29 Design Issues ? Unlikely

1

2

3

4

5

6

Very likely

30 Financial Matters ? Unlikely

1

2

3

4

5

6

Very likely

31 Governance Issues ? Unlikely

1

2

3

4

5

6

Very likely

(F) Setting the JV/Alliance Scope

How clearly do you understand the strategic scope of the alliance for yourself and your company ?

1 Does it include performance obligations ?


2 Does it include a full commitment from your Board of Directors ?


3 What unintended strategic outcomes could the JV/Alliance bring about ?

Developing new commercial opportunities Not really

1

2

3

4

5

6

Most definitely

4 How clearly do you perceive your partners’ strategic scope ?

Not clearly 1 2 3 4 5 6 Very clearly

244


(F) Setting the JV/Alliance Scope

5 Do you understand what underlying assumptions need to hold true for your partners to remain strategically committed to the alliance and to its success ?

Not too sure 1 2 3 4 5 6 Yes, I understand

6 Do you believe differences in the respective strategic scopes that each the partner assigns to the alliance is likely to become sources of conflict ?

Not really 1 2 3 4 5 6 Yes, likely

7 Could the actions of each JV partner likely to be contingent on a broader strategic context ?

No 1 2 3 4 5 6 Yes, possible

8 Does compatibility of the economic strength matter in the JV/Alliance for each partner ?


9 Do you set the operational scope of the alliance, as well as its governance structure, so as to minimize any difficulties between partners ?

Not necessary 1 2 3 4 5 6 Most definitely

(G) Understanding the Task Demands in a JV/Alliance

1 The JV/Alliance value requires complex interactions between partners. Does the alliance composition and the process you would expect to put in place measure up to the task ?

No, it does not 1 2 3 4 5 6 Yes, it does normally

2 Do you devote the amount of attention and effort to the JV/Alliance to ensure profitable venture, enhancing added value for each partner ?

Not normally 1 2 3 4 5 6 Yes, absolutely

3 Are you willing to review and readjust the governance and day-to-day process of the JV/Alliance implementation periodically ?

Not willing 1 2 3 4 5 6 Willing, yes

245


(G) Understanding the Task Demands in a JV/Alliance

4 Does the form given to the JV/Alliance match the needs for each partners needs under uncertainty, task integration, and speedy decision making ?

Not normally 1 2 3 4 5 6 Generally, yes

5 Is the design of your JV contribution capable of handling the task demands ?

Not normally 1 2 3 4 5 6 Generally, yes

6 Do you strive to decrease the task demands and to improve the interface ?

Not intentionally 1 2 3 4 5 6 Purposely, yes

7 Do you build bridges between partners at multiple levels ?

Not normally 1 2 3 4 5 6 Absolutely

8 Are you sensitive enough to the need for coordination within your own organisation and between the various people and sub-units involved in the interface with the partner organisation ?

Not sensitive 1 2 3 4 5 6 Very sensitive

9 To what extent do you need to exercise control ?

No control desired 1 2 3 4 5 6 Yes, control desired

10 To what extent do you need to influence ?

No influence desired 1 2 3 4 5 6 Great influence sought

11 Is that need for control strong enough to justify trade-offs against efficient task performance ?

Not really 1 2 3 4 5 6 Generally, yes

246


(H) Defining and Measuring Progress within a JV/Alliance

1 Does your performance measure of your JV/Alliance cover the balance between using the JV/Alliance to develop options and also achieving commitment to the JV/Alliance ?

Not it doesn't 1 2 3 4 5 6 Yes, it does.

2 Is this performance measure in line with the nature of JV/Alliance objectives ?

No, never 1 2 3 4 5 6 Yes, mostly

3 Do you expect a loss of strategic autonomy when you get involved in a JV/Alliance ?


4 Conversely, how do you measure the gain in future strategic autonomy that normally results from successful learning and internalization through a JV/Alliance ?

We don't bother 1 2 3 4 5 6 We will consider

5 Does the way that you measure success and assess contributions give partners the incentives to excel in the alliance ?

No, it doesn't 1 2 3 4 5 6 Yes, it does

Do you distinguish in your assessment of progress the value creation in:

6 Efficiency ? Not really

1

2

3

4

5

6

Yes, definitely

7 The value of benefits for you ? Not really

1

2

3

4

5

6

Yes, definitely

8 The strategic perspective, risk of dependence versus gain in bargaining power ? Not really

1

2

3

4

5

6

Yes, definitely

9 Are the partners using compatible criteria to measure progress ?

Not really 1 2 3 4 5 6 Yes, they are

247


(I) Understanding and Bridging Gaps between JV/Alliance Partners

1 Is your JV perceptions incompatible with that of your partners, for instance, you see the alliance as a step towards a merger and they see it as a temporary cooperative agreement ?

Not normally 1 2 3 4 5 6 Yes, definitely

2 Does everyone in your organisation who is involved in the JV/Alliance share the same objectives ?

Not normally 1 2 3 4 5 6 Yes, normally

3 If inconsistencies exist, are they between functions, geographical units, or levels in the hierarchy ?

Don't know 1 2 3 4 5 6 Yes, all of the above

4 Do you carry obsolete issues borrowed from an earlier JV experience, which you transfer to other JVs/alliances ?

Not normally 1 2 3 4 5 6 Sometimes, yes

5 Do you see your partners doing the same ?

Not often 1 2 3 4 5 6 All the time

6 Do you try to see the alliance through the eyes of your partners ?


7 Do you share past JV/Alliance experiences with your partners ?

Not normally 1 2 3 4 5 6 Yes, mostly

8 Do you give partners feedback as to why you believe they joined the JV/Alliance, what you perceive to be their motives ?

Not normally 1 2 3 4 5 6 Often

9 Do you discuss discrepancies between stated motives and behaviour ?

Not normally 1 2 3 4 5 6 Often

10 Do you resolve misunderstandings ?

Not really 1 2 3 4 5 6 Yes, normally

11 How well do you communicate about the alliance internally to ensure that everyone involved shares a common and accurate objectives ?

Not often 1 2 3 4 5 6 Very often

248


(J) Expectations of the JV/Alliance?

1 How realistic are your expectations and those of your partners ?

Not very 1 2 3 4 5 6 Fairly realistic

2 Are the negotiation terms of the alliance likely to have led to overly optimistic or ambitious expectations ?

Not really 1 2 3 4 5 6 Sometimes, yes

3 Is there a risk that you and your partner oversold the merits of the JV/Alliance to each other ?

Highly unlikely 1 2 3 4 5 6 Quite possible

4 Do you see the need to assess and validated the alliance's benefits to each partner ?

Not really 1 2 3 4 5 6 Yes, very useful

5 Have you involved those who will be responsible for implementing the alliance in the negotiation process ?

No need 1 2 3 4 5 6 Yes, definitely

6 Have they accepted the stated expectations as their own ?

Not really 1 2 3 4 5 6 Whole heartedly

7 Are you your managers prepared for the possibility of an expected JV failure and consequences of a JV/Alliance failure ?

Not really 1 2 3 4 5 6 Yes, to a smaller degree

249


(K) How Different and Wide is the Organisational Gap between JV/Alliance Partners?

1 How dissimilar are you and your partner organisations in the ways you make decisions and perform work ?

Not very 1 2 3 4 5 6 Very different

Do differences in the size of your company as compared with that of your partners make collaboration difficult because of:

2 Different speeds or styles of decision making ? No never

1

2

3

4

5

6

Yes, sometimes

3 Different pace and rhythm of strategizing and planning ? Not really

1

2

3

4

5

6

Yes, sometimes

4 Different ways of handling data ? Not sure

1

2

3

4

5

6

Yes, sometimes

5 Are any of the differences between you and your partners in how work gets done likely to make joint work in the alliance hard to perform ?

Not really 1 2 3 4 5 6 Yes, definitely

6 Are these differences likely to make you uncomfortable about working together again in the future ?

Not really 1 2 3 4 5 6 Yes, possible

7 Might this, in turn, prevent learning ?

Not really 1 2 3 4 5 6 Yes, possible

250


(L) Bridging the Gap between the JV/Alliances

1 Have you recognized the importance of organisational and cultural compatibility in the design of your alliance ?

Not important 1 2 3 4 5 6 Most definitely

2 Do you appoint to the JV/Alliance, managers who have had experience working in different kinds of cultures, nationality, organisation ?

Not really 1 2 3 4 5 6 Normally, yes

3 Did you make an effort to learn how partner organisations really operate ?


4 Do you refrain from making premature judgments about the partner’s ways of working ?

Not really 1 2 3 4 5 6 Yes, definitely

5 Have you planned for buffers in the design of the partnership interface ?

Don't bother 1 2 3 4 5 6 Yes, effort is made

6 Do you and your partners create space and time (for instance, in joint workshops and seminars) for members of the partner organisations to share & understand their respective organisational contexts ?

Not really 1 2 3 4 5 6 Sometimes, yes.

7 Do partners exchange enough personnel or is the relationship kept at “arm's length” ?

Arms length 1 2 3 4 5 6 Exchange personnel

8 Are your managers comfortable with the level of interaction with their partners or is it too little or too much ?

Not comfortable 1 2 3 4 5 6 Very comfortable

251


(M) Confidence amongst JV/Alliance?

1 As they enter the partnership, do your managers and specialists feel secure enough in their position with your company so that they will feel free to adjust to the partner’s ways of working and to adapt their own behaviour in order to make the alliance work ?

Not very secure 1 2 3 4 5 6 Very comfortable

2 Is the alliance itself seen as a personal threat, for instance, to anyone’s job ?

Not sure 1 2 3 4 5 6 Can be sometimes

3 Is mutual dependence accepted by members of the partner organisations ?

Not really 1 2 3 4 5 6 Mostly, yes

4 Are any members of your organisation or your partners likely to see the need for the alliance to be a success or a failure ?

Failure 1 2 3 4 5 6 Success

5 Do JV partners understand the likely personal consequence of alliance success, failures ?

Not fully 1 2 3 4 5 6 Yes, fully understand.

6 Are potential fears contained ?

Not really 1 2 3 4 5 6 Yes, contained somewhat

7 Is the enhanced profile of the JV/Alliance understood and shared by all at the personal level ?

Sometimes not 1 2 3 4 5 6 Mostly, yes

8 Are there risks that individual managers and specialists will lose from the JV/Alliance ?

Not really 1 2 3 4 5 6 Of course

9 Do you believe transparency is essential in any form of JV/Alliance amongst partners ?

Not essential 1 2 3 4 5 6 Yes, a must

10 Is full disclosure of each partners business necessary when creating a JV/Alliance ?

Not necessary 1 2 3 4 5 6 Very necessary

252


(M) Confidence amongst JV/Alliance?

11 Do you as a partner is a JV/Alliance always fully disclose your position to your partner(s) ?

Not always 1 2 3 4 5 6 Always

12 Do you think religion has a part to play in creation of JV/Alliance ? Does it form part of any decision in this creation process ?

No consideration 1 2 3 4 5 6 Is seriously considered

13 Does education differences covering issues such as standards, professional competency affect the creation and development of JV/Alliance ?

Not really 1 2 3 4 5 6 Yes, mostly

253

Appendix C: Raw Structured Interview Responses of Study One.

Summary of Responses to Interview Question Series Section A Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

1 1 0 2 0 3 0 4 0 5 1 1 1 1 1 5 6 1 1 1 1 4 9 2 1 0 2 0 3 1 1 4 0 5 1 1 1 1 1 1 6 6 1 1 2 9 3 1 1 1 2 0 3 1 1 4 1 1 5 1 1 1 3 6 1 1 1 3 9 4 1 0 2 0 3 0 4 1 1 2 5 1 1 2 6 1 1 1 1 1 5 9 5 1 0 2 1 1 3 1 1 4 1 1 1 1 1 5 5 1 1 6 1 1 9

254

Appendix C (Continued …)

Summary of Responses to Interview Question Series (Continued …) Section B Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

1 1 1 1 2 1 1 3 0 4 1 1 1 3 5 1 1 2 6 1 1 2 9 2 1 0 2 0 3 1 1 1 3 4 1 1 5 1 1 1 1 4 6 1 1 9 3 1 0 2 1 1 2 3 1 1 4 1 1 1 3 5 1 1 6 1 1 2 9 4 1 0 2 1 1 3 1 1 1 3 4 1 1 5 1 1 2 6 1 1 2 9 5 1 0 2 0 3 0 4 1 1 5 1 1 1 1 1 1 6 6 1 1 2 9 6 1 0 2 0 3 0 4 0 5 1 1 1 1 1 1 1 7 6 1 1 2 9

255



7 1 1 1 2 1 1 1 3 3 1 1 2 4 0 5 1 1 1 3 6 0 9 8 1 0 2 0 3 0 4 0 5 1 1 1 1 1 5 6 1 1 1 1 4 9 9 1 0 2 1 1 3 0 4 1 1 5 1 1 1 1 4 6 1 1 1 3 9

10 1 1 1 2 0 3 0 4 1 1 2 5 1 1 1 1 4 6 1 1 2 9

11 1 0 2 0 3 1 1 4 1 1 2 5 1 1 2 6 1 1 1 1 4 9

12 1 0 2 0 3 0 4 1 1 2 5 1 1 1 3 6 1 1 1 1 4 9

256



13 1 0 2 1 1 3 0 4 0 5 1 1 1 1 1 5 6 1 1 1 3 9

14 1 0 2 1 1 1 1 4 3 0 4 1 1 1 3 5 1 1 6 1 1 9

15 1 0 2 1 1 1 3 3 1 1 4 1 1 1 3 5 1 1 2 6 0 9

16 1 0 2 0 3 1 1 4 1 1 1 3 5 1 1 1 1 1 5 6 0 9

17 1 0 2 1 1 1 1 4 3 0 4 1 1 5 1 1 2 6 1 1 2 9

18 1 0 2 0 3 0 4 0 5 1 1 1 1 1 1 6 6 1 1 1 3 9

19 1 1 1 2 2 1 1 1 3 3 1 1 2 4 0 5 1 1 2 6 0 9

257


Summary of Responses to Interview Question Series (Continued …) Section C Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

1 1 0 2 0 3 0 4 0 5 1 1 1 3 6 1 1 1 1 1 1 6 9 2 1 0 2 1 1 2 3 1 1 4 1 1 5 1 1 6 1 1 1 1 4 9 3 1 0 2 1 1 1 3 3 1 1 4 1 1 5 0 6 1 1 1 1 4 9

Section D 1 1 1 1 2 1 1 3 0 4 1 1 2 5 1 1 1 3 6 1 1 2 9 2 1 0 2 1 1 3 0 4 1 1 1 3 5 1 1 1 1 4 6 1 1 9 3 1 0 2 1 1 3 1 1 1 1 4 4 1 1 1 3 5 1 1 6 0 9 4 1 1 1 2 1 1 2 3 1 1 2 4 1 1 5 1 1 6 1 1 2 9

258


Summary of Responses to Interview Question Series (Continued …) Section D Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

5 1 0 2 1 1 3 1 1 4 1 1 5 1 1 1 1 4 6 1 1 2 9 6 1 1 1 2 2 1 1 2 3 1 1 4 0 5 1 1 1 1 4 6 0 9 7 1 1 1 1 1 4 2 1 1 3 1 1 1 3 4 0 5 1 1 6 0 9 8 1 0 2 1 1 3 1 1 4 1 1 5 1 1 1 1 4 6 1 1 2 9 9 1 1 1 2 1 1 3 1 1 4 1 1 5 1 1 1 3 6 1 1 2 9

10 1 0 2 0 3 0 4 0 5 1 1 1 3 6 1 1 1 1 1 1 6 9

11 1 1 1 2 0 3 0 4 0 5 1 1 1 1 4 6 1 1 1 1 4 9

259


Summary of Responses to Interview Question Series (Continued …) Section D Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

12 1 0 2 1 1 2 3 1 1 4 1 1 5 1 1 6 1 1 1 1 4 9

13 1 0 2 1 1 2 3 0 4 1 1 5 1 1 1 3 6 1 1 1 3 9

14 1 0 2 1 1 3 0 4 1 1 2 5 1 1 1 1 4 6 1 1 2 9

15 1 0 2 1 1 3 1 1 2 4 1 1 5 1 1 1 1 4 6 1 1 9

260


Summary of Responses to Interview Question Series (Continued …) Section E Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

1 1 1 1 1 1 1 5 2 1 1 2 3 0 4 0 5 1 1 2 6 0 9

2a 1 1 1 2 2 1 1 2 3 1 1 1 3 4 1 1 5 1 1 6 0 9

2b 1 1 1 1 3 2 1 1 1 3 3 1 1 4 1 1 5 1 1 6 0 9 3 1 1 1 2 2 1 1 3 0 4 1 1 5 1 1 1 3 6 1 1 2 9 4 1 0 2 0 3 0 4 0 5 1 1 1 1 1 5 6 1 1 1 1 4 9

261



5a leader 1 1 1 1 4 Nishimatsu challenger 1 1 2

laggard 1 1 1 3 newcomer 0 9

5b leader 1 1 1 1 1 1 6 D/B challenger 1 1 2

laggard 0 newcomer 0 8

5c leader 0 Costain challenger 1 1 2

laggard 1 1 1 1 1 1 1 7 newcomer 0 9

5d leader 0 ZP challenger 1 1 1 1 1 1 6

laggard 0 newcomer 1 1 1 3 9

5e leader 1 1 CH challenger 1 1 1 1 1 1 6

laggard 1 1 2 newcomer 0 9

5f leader 1 1 1 1 1 1 1 7 GC challenger 1 1

laggard 0 newcomer 0 8 6 1 0 2 0 3 0 4 0 5 1 1 1 1 1 5 6 1 1 1 1 4 9 7 1 0 2 0 3 1 1 4 0 5 1 1 1 1 1 1 6 6 1 1 2 9 8 1 1 1 2 2 1 1 1 1 1 5 3 0 4 0 5 1 1 6 1 1 9

262


Summary of Responses to Interview Question Series Section E Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

9 1 1 1 1 1 1 5 2 1 1 3 0 4 1 1 2 5 1 1 6 0 9

10 1 1 1 2 1 1 1 3 3 1 1 4 1 1 5 1 1 2 6 1 1 9

11 1 0 2 1 1 3 1 1 4 1 1 5 1 1 2 6 1 1 1 1 4 9

12 1 0 2 1 1 3 0 4 1 1 5 0 6 1 1 1 1 1 1 1 7 9

13 1 0 2 0 3 0 4 0 5 1 1 6 1 1 1 1 1 1 1 1 8 9

14 1 0 2 0 3 0 4 0 5 1 1 6 1 1 1 1 1 1 1 1 8 9

15 1 1 1 2 0 3 0 4 1 1 2 5 1 1 1 1 1 5 6 1 1 9

263



16 1 0 2 1 1 1 3 3 1 1 4 0 5 1 1 1 1 4 6 1 1 9

17 1 1 1 2 1 1 1 3 3 1 1 4 0 5 1 1 1 3 6 1 1 9

18 1 0 2 1 1 2 3 1 1 2 4 1 1 2 5 1 1 6 1 1 2 9

19 1 0 2 0 3 1 1 2 4 1 1 2 5 1 1 1 1 4 6 1 1 9

20 1 0 2 0 3 0 4 1 1 5 1 1 2 6 1 1 1 1 1 1 6 9

21 1 0 2 1 1 3 1 1 4 1 1 5 1 1 1 1 4 6 1 1 2 9

22 1 0 2 1 1 2 3 1 1 4 1 1 2 5 1 1 1 3 6 1 1 9

264



23 1 0 2 0 3 1 1 2 4 1 1 2 5 1 1 1 3 6 1 1 2 9

24 1 0 2 1 1 3 1 1 2 4 1 1 1 1 1 1 6 5 0 6 0 9

25 1 1 1 2 2 1 1 1 3 3 1 1 2 4 1 1 5 1 1 6 0 9

26 1 1 1 2 1 1 3 0 4 1 1 1 3 5 1 1 1 3 6 0 8

27 1 0 2 1 1 3 1 1 4 1 1 1 3 5 1 1 1 1 4 6 0 9

28 1 1 1 2 1 1 3 1 1 2 4 1 1 1 1 1 5 5 0 6 0 9

29 1 0 2 1 1 2 3 0 4 0 5 1 1 1 1 1 5 6 1 1 2 9

265



30 1 0 2 1 1 2 3 1 1 4 1 1 5 1 1 1 1 1 5 6 0 9

31 1 0 2 1 1 1 3 3 1 1 4 1 1 2 5 1 1 1 3 6 0 9

Section F 1 1 0 2 0 3 0 4 0 5 1 1 1 3 6 1 1 1 1 1 1 6 9 2 1 0 2 0 3 0 4 1 1 5 1 1 6 1 1 1 1 1 1 1 7 9 3 1 0 2 0 3 1 1 4 1 1 1 3 5 1 1 1 3 6 1 1 2 9 4 1 0 2 0 3 1 1 1 3 4 1 1 1 3 5 1 1 1 3 6 0 9 5 1 0 2 0 3 1 1 4 1 1 1 3 5 1 1 1 3 6 1 1 2 9

266


Summary of Responses to Interview Question Series (Continued …) Section F Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

6 1 0 2 0 3 0 4 1 1 1 1 1 5 5 1 1 1 3 6 1 1 9 7 1 0 2 0 3 1 1 4 1 1 1 3 5 1 1 1 3 6 1 1 2 9 8 1 0 2 1 1 1 3 3 1 1 4 0 5 1 1 1 1 4 6 1 1 9 9 1 0 2 0 3 0 4 0 5 1 1 1 1 4 6 1 1 1 1 1 5 9

Section G 1 1 0 2 0 3 0 4 1 1 1 1 4 5 1 1 1 3 6 1 1 2 9 2 1 0 2 0 3 0 4 1 1 2 5 1 1 1 1 4 6 1 1 1 3 9 3 1 0 2 1 1 3 0 4 0 5 1 1 1 1 1 1 6 6 1 1 2 9

267


Summary of Responses to Interview Question Series (Continued …) Section G Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

4 1 0 2 0 3 1 1 4 1 1 1 1 4 5 1 1 1 3 6 1 1 9 5 1 0 2 0 3 0 4 1 1 5 1 1 1 1 1 5 6 1 1 1 3 9 6 1 0 2 0 3 0 4 1 1 2 5 1 1 1 1 1 5 6 1 1 2 9 7 1 0 2 0 3 0 4 1 1 2 5 1 1 1 1 4 6 1 1 1 3 9 8 1 0 2 0 3 0 4 1 1 5 1 1 1 3 6 1 1 1 1 1 5 9 9 1 0 2 1 1 3 0 4 1 1 2 5 1 1 1 1 4 6 1 1 2 9

10 1 0 2 0 3 0 4 1 1 2 5 1 1 1 1 1 5 6 1 1 2 9

268


Summary of Responses to Interview Question Series (Continued …) Section G Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

11 1 0 2 0 3 1 1 4 1 1 2 5 1 1 1 1 1 5 6 1 1 9

Section H 1 1 0 2 1 1 3 0 4 1 1 5 1 1 1 1 1 5 6 1 1 8 2 1 0 2 0 3 0 4 1 1 2 5 1 1 1 1 1 1 6 6 1 1 9 3 1 0 2 1 1 2 3 0 4 1 1 5 1 1 1 1 4 6 1 1 2 9 4 1 0 2 0 3 1 1 4 1 1 2 5 1 1 1 1 4 6 1 1 2 9 5 1 0 2 0 3 0 4 1 1 1 1 4 5 1 1 1 1 4 6 1 1 9 6 1 0 2 0 3 0 4 1 1 5 1 1 1 1 1 1 6 6 1 1 2 9

269


Summary of Responses to Interview Question Series (Continued …) Section H Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

7 1 0 2 0 3 0 4 1 1 5 1 1 1 1 4 6 1 1 1 1 4 9 8 1 0 2 1 1 3 1 1 4 1 1 1 1 4 5 1 1 6 1 1 2 9 9 1 0 2 1 1 3 1 1 4 1 1 1 3 5 1 1 1 3 6 1 1 9

Section I 1 1 1 1 2 2 1 1 1 1 1 5 3 1 1 4 1 1 5 0 6 0 9 2 1 0 2 1 1 2 3 1 1 4 1 1 5 1 1 1 1 1 5 6 0 9 3 1 0 2 0 3 1 1 2 4 1 1 2 5 1 1 1 1 4 6 1 1 9 4 1 1 1 2 0 3 0 4 1 1 1 1 4 5 1 1 1 3 6 1 1 9

270


Summary of Responses to Interview Question Series (Continued …) Section I Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

5 1 0 2 0 3 0 4 1 1 2 5 1 1 1 1 1 1 6 6 1 1 9 6 1 0 2 0 3 0 4 1 1 1 3 5 1 1 1 1 4 6 1 1 2 9 7 1 0 2 1 1 3 0 4 1 1 5 1 1 6 1 1 1 1 1 1 6 9 8 1 0 2 1 1 3 1 1 4 1 1 2 5 1 1 1 3 6 1 1 2 9 9 1 0 2 1 1 3 1 1 4 0 5 1 1 1 1 4 6 1 1 1 3 9

10 1 0 2 0 3 0 4 0 5 1 1 1 1 4 6 1 1 1 1 1 5 9

11 1 0 2 0 3 1 1 2 4 1 1 1 3 5 1 1 2 6 1 1 2 9

271


Summary of Responses to Interview Question Series (Continued …) Section J Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

1 1 0 2 0 3 1 1 4 1 1 5 1 1 1 3 6 1 1 1 1 4 9 2 1 0 2 1 1 2 3 1 1 4 1 1 1 1 4 5 1 1 6 1 1 9 3 1 1 1 2 0 3 1 1 4 1 1 1 1 1 5 5 1 1 6 1 1 9 4 1 0 2 0 3 1 1 2 4 1 1 5 1 1 1 3 6 1 1 1 3 9 5 1 0 2 0 3 1 1 4 0 5 1 1 1 1 1 1 6 6 1 1 2 9 6 1 0 2 0 3 1 1 4 1 1 1 1 4 5 1 1 1 1 4 6 0 9 7 1 1 1 2 2 1 1 3 0 4 0 5 1 1 1 1 4 6 1 1 2 9

272


Summary of Responses to Interview Question Series (Continued …) Section K Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

1 1 0 2 1 1 2 3 0 4 1 1 2 5 1 1 1 1 4 6 1 1 9 2 1 0 2 1 1 3 0 4 1 1 2 5 1 1 1 3 6 1 1 1 3 9 3 1 0 2 0 3 1 1 4 1 1 1 3 5 1 1 2 6 1 1 1 3 9 4 1 0 2 0 3 1 1 2 4 1 1 1 3 5 1 1 6 1 1 1 3 9 5 1 1 1 2 1 1 2 3 1 1 2 4 1 1 2 5 1 1 6 1 1 9 6 1 1 1 2 2 1 1 3 1 1 4 1 1 1 3 5 1 1 6 1 1 9 7 1 1 1 2 1 1 1 3 3 0 4 1 1 1 3 5 1 1 2 6 0 9

273


Summary of Responses to Interview Question Series (Continued …) Section L Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

1 1 0 2 1 1 3 0 4 1 1 5 1 1 1 3 6 1 1 1 1 4 9 2 1 0 2 0 3 0 4 1 1 5 1 1 1 1 1 1 6 6 1 1 2 9 3 1 0 2 0 3 1 1 4 1 1 5 1 1 1 1 1 5 6 1 1 2 9 4 1 0 2 1 1 3 1 1 4 1 1 1 1 1 5 5 1 1 6 1 1 9 5 1 0 2 0 3 1 1 2 4 1 1 2 5 1 1 1 1 4 6 1 1 9 6 1 0 2 1 1 3 0 4 1 1 1 1 4 5 1 1 2 6 1 1 2 9

274


Summary of Responses to Interview Question Series (Continued …) Section L Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

7 1 1 1 2 2 1 1 1 1 4 3 1 1 4 1 1 5 0 6 1 1 9 8 1 0 2 1 1 2 3 1 1 2 4 1 1 1 1 4 5 1 1 6 0 9

Section M 1 1 0 2 1 1 3 1 1 2 4 1 1 1 1 4 5 1 1 6 1 1 9 2 1 1 1 2 2 1 1 2 3 0 4 1 1 1 3 5 1 1 6 1 1 9 3 1 0 2 1 1 3 1 1 2 4 1 1 1 1 1 5 5 1 1 6 0 9 4 1 0 2 0 3 0 4 0 5 1 1 1 1 4 6 1 1 1 1 1 5 9 5 1 0 2 0 3 0 4 0 5 1 1 1 1 1 1 1 7 6 1 1 2 9

275


Summary of Responses to Interview Question Series (Continued …) Section M Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

6 1 0 2 0 3 1 1 2 4 1 1 2 5 1 1 1 1 1 5 6 0 9 7 1 0 2 1 1 3 1 1 1 3 4 1 1 5 1 1 1 3 6 1 1 9 8 1 1 1 2 1 1 2 3 1 1 4 1 1 1 1 4 5 0 6 1 1 9 9 1 0 2 0 3 0 4 0 5 1 1 6 1 1 2

10 1 0 2 0 3 0 4 0 5 1 1 2 6 0 2

11 1 0 2 0 3 1 1 4 0 5 1 1 6 0 2

276


Summary of Responses to Interview Question Series (Continued …) Section M Participant No. Question No. Response 1 2 3 4 5 6 7 8 9 Subtotal Total

12 1 1 1 2 2 0 3 0 4 0 5 0 6 0 2

13 1 0 2 0 3 0 4 0 5 1 1 2 6 0 2

277

Appendix D: Strategic Alliance Contracting Inventory (SACI) Used in Study Two.

------------------------------------------------------------------------------------------------------------------------

STRICTLY CONFIDENTIAL ------------------------------------------------------------------------------------------------------------------------

STRATEGIC ALLIANCE CONTRACTING INVENTORY (SACI)

RMIT UNIVERSITY, MELBOURNE ------------------------------------------------------------------------------------------------------------------------

STRICTLY CONFIDENTIAL ------------------------------------------------------------------------------------------------------------------------

278

Appendix D (Continued ...)

Section A BACKGROUND INFORMATION Please place a check √ beside or circle the most appropriate answer to each of the following questions. In a

few cases, please fill in the blank.

1) What is your age ? _____________ years

2) Gender _____ Male _____ Female

3) Please indicate the highest grade in school you have completed

3.1) _____ High School Degree/Diploma or Less

3.2) _____ Some College Education

3.3) _____ Bachelor’s Degree

3.4) _____ Some Graduate Education

3.5) _____ Graduate Degree

3.6) _____ Other (Please specify) _________________________________________________ 4) What is the name of your organisation or company ? _____________________________________ 5) What is your job title within your organisation ? _________________________________________ 6) How long have you been in your current job ? ________ years 7) Which project-based joint venture were you involved with ? 7.1) Terminal 8 Development (US$400 million) 7.2) Route 3 Tai Lam Tunnel & Approach Road (US$950 million) 7.3) MTRC - EHC/LAT Tunnels and Earthworks (US$100 million) 7.4) None of the above 8) Please indicate the nature of your relationship within this project-based joint venture 8.1) Site Project Management 8.2) Head Office Participant 8.3) Service Provider 8.4) Client 8.5) Other (Please specify) _________________________________________________ 9) The foreign partners involved in the JV-strategic alliance(s) with your organisation comes from

which country(s) ? __________________________________________________________________

10) Approximately how long has your organisation been involved in a JV-strategic alliance(s) with these

foreign partner(s) ? ________ years

279


Section B Instructions Listed below are a series of statements regarding opinions about Joint Ventures or strategic alliances. With regard to your own knowledge and experience relating to the purpose, development and maintenance of strategic alliances or joint ventures with local partner companies within your organisation over the past 24 months, please indicate the extent of your agreement or disagreement with each statement as given below. Over the past 24 months … 1. When an unexpected situation arises, JV partners would rather work out a new arrangement than hold

each other to the original JV obligations.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 2. Communication with partner organisations has been very difficult.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 3. In order to accomplish their individual responsibilities, JV partners have depended highly on one another

for services, support and resources.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 4. My joint venture or strategic alliance experience in Hong Kong has been really different from any others

that I or my company has had outside Hong Kong.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 5. The way in which strategic decisions have been made has been determined between our company and

the partner organisation.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

280


Over the past 24 months … 6. Once our company enters into a JV-strategic alliance with another partner, it usually takes a great deal of

trust to ensure that the other partner will work in the best interests of the partnership.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 7. Our company could not be more pleased with the performance of our Joint Ventures.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 8. It is not possible to close the cultural differences in such project based practices covering the

management, transfer of technology and knowledge with the partner organisations in Hong Kong.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 9. JV partner organisations have been always ready to help one another when the need arises.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 10. JV partner organisations are only interested in short-term rather than long-term benefits.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 11. Once our company establishes a business relationship with another partner, it remains very loyal to that

relationship and works hard to ensure that the relationship remains strong for a long time.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

281


Over the past 24 months … 12. Although the law and regulations do not force foreign investors to have a local partner in Hong Kong,

for competitive reasons, it is better to engage in a partnership arrangement.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 13. Partner organisations have had unreasonable expectations about joint ventures.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 14. The partner organisation in our JV-alliance(s) can be trusted to make sensible decisions.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 15. In Hong Kong, one is likely to experience a lot of difficulties with establishing and maintaining joint

ventures with partner organisations.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 16. Partner organisations in our alliances would be quite prepared to gain advantage by deceiving our

company.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 17. Partner organisations have had control over the planning process in joint ventures.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

282


Over the past 24 months … 18. In most aspects of relationships, JV partners share the responsibility for getting things done.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 19. Exchanges of information take place frequently, informally and openly between JV Partner

organisations.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 20. Parties in our alliances can rely on each other to abide by original JV agreements and obligations.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 21. Joint venture partner organisations are only interested in quick profits and are reluctant to reinvest in the

joint venture.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 22. Our company and our partner organisations decide when and how changes should be made in the

JV/alliances.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 23. The experience of this company of continuing or forming new joint ventures with cultural diverse

partner organisations in Hong Kong, generally lasts between 5 to 10 years.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

283


Over the past 24 months … 24. The competitive environment is so complex that one needs a joint venture partner to do business in Hong

Kong.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 25. JV partner organisations are only interested in gaining access to each other’s technology.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 26. Problems that arise in JV/strategic alliances are resolved jointly rather than as individual partners

responsibilities.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 27. Mutual trust with partner organisations has been difficult to establish, given the cultural differences

which exist.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 28. This company and the partner organisation get along very well as a co-ordinated team.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 29. We wish to get out of our joint venture(s) as soon as possible.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

284


Over the past 24 months … 30. Our company is reluctant to make resource commitments to the JV alliance when specifications in the

agreement are ambiguous.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 31. It is generally expected that the parent companies in JV relationships will openly provide information

covering production, research, development, budgeting etc., if it can help the joint venture.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 32. Partners in joint venture(s) are ready to defend one another against criticism by outsiders.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 33. The responsibility for making sure that the relationship within the JV-alliance works is shared equally

amongst parties.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 34. Generally, I could not be more pleased with the performance of our joint venture(s).

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 35. Our company and the partner organisation maintain a strong committed and purposeful relationship.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

285


Over the past 24 months … 36. In order to develop effective partnerships between foreign multinational firms and local companies in

Hong Kong, leadership behaviour which takes account of cultural differences, is important.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 37. JV partners have been prepared modify their agreement if unexpected events occur.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 38. There has been a high degree of trust between our company and our JV partner organisation.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 39. Because of cultural differences in knowledge and socialization between JV partners, it is often difficult

to establish mutually agreed goals and objectives when undertaking major infrastructure projects in Hong Kong.

Strongly

Disagree Strongly

Agree

1 2 3 4 5 6 40. In order to do their work, JV partners are very dependent on one another for information.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 41. In the establishment and maintenance of JV-strategic alliances, local Hong Kong companies tend to

operate and adapt well in working together as a coordinated team with foreign multinational firms, despite the cultural differences which exist between them.

Strongly

Disagree Strongly

Agree

1 2 3 4 5 6

286


Over the past 24 months … 42. There have been a number of difficulties in successfully forming effective and efficient project-based

relationships between foreign multinational and local companies in Hong Kong, because of cultural differences and the perception of task obligations/commitments.

Strongly

Disagree Strongly

Agree

1 2 3 4 5 6 43. I have been satisfied with the way in which decisions were made in this joint venture or alliance with the

partner organisation.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 44. Changes to contract terms and obligations are willingly agreed to by JV partners if they are considered

necessary.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 45. Partners had to co-ordinate with each other to ensure that they carried out their work in an efficient

manner.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 46. Decisions in this relationship with the partner organisation have been applied with fairness, respect and

courtesy.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 47. The partners keep one another informed of changes and events that might affect them.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

287


Over the past 24 months … 48. Partner organisations have been willing and ready to concede on issues to enable the joint venture to

achieve its strategic goals and objectives, as stated in the agreement.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 49. The establishment of various types of alliances or joint ventures with partner organisations in Hong

Kong has been very limited because of cultural differences in management and work practices.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 50. This company has had lengthy experience in joint venturing with other partner organisations in Hong

Kong.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 51. We have been extremely satisfied with the progress that has been made towards achieving our long-term

goals in joint ventures.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 52. Due to the cultural similarities between local companies, it is often easier for such organisations to enter

into business ventures or partnerships, rather than with foreign companies in Hong Kong.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 53. Parties in our JV-alliance(s) have had a high level of mutual trust in most activities.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

288


Over the past 24 months … 54. There is two-way communication in the decision-making process between the JV partners at executive

level.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 55. Our organisation’s investments in joint venture(s) are always rewarded beyond original expectations.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 56. There are a number of benefits associated with partnerships between foreign multinational and local

companies in Hong Kong, despite the cultural differences which exist.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 57. Our organisation has plans to expand the scale of operations in our existing joint venture arrangements

with partner organisations.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 58. Our organisation always stands by its word, even when this was not in its best interests in its JV’s.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 59. Our organisation has plans for increasing levels of assistance to our joint ventures.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

289


Over the past 24 months … 60. It is not difficult to establish project-based partnerships amongst foreign multinational firms in Hong

Kong, even in light of the existence of some cultural differences.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 61. Our organisation is willing to provide and share managerial resources, knowledge and expertise with the

partner organisations in our joint ventures.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 62. The JV-alliance is flexible when our company cannot keep to a specific promise stipulated in the JV-

alliance agreement, due to unexpected environmental changes.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 63. This company tries to ensure that JV partner organisations know what is expected of them in joint

venture arrangements.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 64. The transfer of technology, knowledge, and skills between foreign multinational and local firms is

frequently limited or restricted because of cultural differences in Hong Kong.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 65. JV partners never profit from opportunities that arise out of partner organisations, at the expense of the

JV/alliance.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

290


Over the past 24 months … 66. Due to cultural differences, multi-national contracting companies gain little benefit from establishing a

strategic alliance with a local company in Hong Kong.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 67. Compared to our competitors in this industry, our organisatioin has gained important access to

technology transfer and knowledge through engaging in a joint venture relationship with a partner organisation in Hong Kong.

Strongly

Disagree Strongly

Agree

1 2 3 4 5 6 68. The establishment of a joint venture or strategic alliance with a partner organisation in Hong Kong has

been advantageous in gaining access to new commercial opportunities, human resources, and markets not otherwise available.

Strongly

Disagree Strongly

Agree

1 2 3 4 5 6 69. The competitive status of this company has been improved in terms of the transfer of knowledge, skills

and expertise gained through the development of a joint venture or strategic alliance with a partner organisation in Hong Kong.

Strongly

Disagree Strongly

Agree

1 2 3 4 5 6

291


Section C Instructions With respect to your own feelings about the nature of JV-alliance(s) with the partner organisations in Hong Kong, please indicate the extent with which you agree with each of the following statements. 70. I tell my friends that our JV-alliance(s) are great to be involved with.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 71. I do not feel much loyalty to our JV-alliance(s).

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 72. I am proud to tell others that I am involved with these JV-alliances.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 73. Deciding to work with these JV-alliances was a definite mistake on my part.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 74. There’s not much to be gained by remaining indefinitely with these JV-alliances.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 75. For myself, these are the best of all JV-alliances to be associated with.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

292


Section D Instructions With respect to your own feelings about the nature of the your own organisation for which you work in Hong Kong, please indicate the extent with which you agree with each of the following statements. 76. I am willing to put in a great deal of effort beyond that normally expected in order to help this

organisation be successful.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 77. I tell my friends that this company is a great one to be associated with.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 78. I feel very little loyalty to this organisation.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 79. I find that my values and that of my company’s values are similar.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 80. I am proud to tell others that I am associated with this company.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 81. Becoming associated with this company was a definite mistake on my part.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

293


82. I really care about the fate of this company.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 83. For myself, this is the best of all organisations to be associated with.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 84. I would accept almost any type of job assignment in order to keep working for this organisation.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 85. I could just as well be working for a different organisation as long as the type of work were similar.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 86. This organisation really inspires the very best in me in the way of job performance.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 87. It would take very little in my present circumstances to cause me to leave this organisation.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

294


88. I am extremely glad that I chose this organisation to work for over others I was considering at the time I

joined.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6 89. Often, I find it difficult to agree with this organisation’s policies on important matters relating to its

employees.

Strongly Disagree

Strongly Agree

1 2 3 4 5 6

- The End -

0

Appendix E: Descriptive Summary of the Four Differing Types of Joint Ventures.

Included below is a descriptive summary regarding the characteristics of each type of joint

venture sampled in Study Two (i.e., Terminal 8 Development, Route 3 Country Park

Section, MTR Contract 612, and East Rail Extension, Permanent Way, CC-1850).

(i) Terminal 8 Development

Terminal 8 involved the development of the Kwai Chung Container Port Complex. The

project was awarded to the Terminal 8 Platform Contractors which comprised Gammon

Construction Limited, (who until 11 August 2004, was previously known as Gammon

Skanska Limited, has reverted to Gammon Construction Limited, due to the UK

headquartered Balfour Beatty plc Group taking over the Skanska shareholding) ;

Nishimatsu Construction Co. Ltd (a Hong Kong based Japanese Construction company,

with headquarters in Tokyo); China Harbour Engineering Company (a Hong Kong based

company, with headquarters in Beijing); and Jan De Nul and Ballast Nedam (dredging

companies from Europe, Holland and Belgium respectively). The project comprised the

construction of a significant new quay deck that involved substantial dredging and

reclamation works, including the installation of hundreds of pillons with which to support

the quay deck. The value of the Project was approximately US$400 million and managed as

a non-integrated Joint Venture, wherein each partner managed their own resources whilst

working within the overall Joint Venture. The Project was awarded in October 1991 and

completed ahead of schedule in 1994.

1


(Continued …)

(ii) Route 3 Country Park Section

The Route 3 Expressway was designed to provide a strategic link between Hong Kong

Island, Western Kowloon, the New Territories and China. The section of Route 3 from

Hong Kong to Tsing Yi, which forms part of the Airport Core Project (ACP), was

completed in mid-1997. The completion of the Country Park Section of Route 3 in May,

1998, therefore, has provided substantially improved road access from the Chinese border

to the Hong Kong container ports, namely, Hong Kong’s newly constructed Chep Lap Kok

Airport as well as the Central Business District located on Hong Kong Island. The Route 3

Country Park Section is a Build Operate and Transfer (BOT) project, covering 12

kilometres of expressway with a dual three-lane 3.7 kilometre tunnel. Moreover, it passes

through some of Hong Kong’s most attractive rural countryside, including the Tai Lam

Country Park. Construction of the Project was awarded by the Franchisee Route 3 (CPS)

Co. Ltd. to the Route 3 Contractors Consortium, comprising Nishimatsu Construction Co

Ltd., Dragages et Travaux Publics (HK) Ltd. with Gammon Construction Ltd., now known

as Gammon Skanska Limited, as the principal subcontractor. The cost of the project

amounted to approximately US$1 billion.

2


(Continued …)

(ii) Route 3 Country Park Section (Continued …)

Under the BOT arrangement, a joint venture was established, with overall control being

exercised by a supervisory board comprising senior representatives from each Joint Venture

partner. The Joint Venture was non-integrated, however the project management

organisation, employed by the Consortium undertook the supervision, co-ordination and

financial administration of the works, including the design responsibility through their

consultants MSWJV, in developing the conceptual design and meeting all requirements as

stipulated under the design approval and checking procedures. Nishimatsu, a Japanese

Construction Company, who has an annual net turnover of US$7 billion, was responsible

for the northern-half of the Tai Lam Tunnel, including the ventilation and electrical

services buildings together with the external works from the north portal to the toll

plaza/administration building.

Furthermore, Nishimatsu was the prime Sponsor Company for the Consortium, Dragages et

Travaux, and has more than 35 years experience in Hong Kong and in the region, forms

part of the Paris-based Bouygues Group, and represents one of the worldís largest

contractors. For example, Dragages et Travaux constructed the southern half of the Tai

Lam Tunnel, including ventilation and electrical services buildings as well as excavation to

the Ting Kau approach area. Gammon Skanska Limited, who are the largest building and

civil engineering contractor in Hong Kong, with more than 40 years experience in the

construction of major projects, was responsible for all earthworks, roadworks and bridges

3


(Continued …)

(ii) Route 3 Country Park Section (Continued …)

north of the toll plaza, including the interchange at Au Tau/Yuen Long together with the

structures linking the Tuen Mun Highway and the roadworks south of the tunnel. Route 3

Contractors Consortium awarded the major subcontract for mechanical, electrical and

control systems, as well as detailed design and installation to GEC (Hong Kong) Ltd, also

managed by the R3CC project management team. The project commenced construction in

1995 and opened to traffic in mid-1998. Minor works continue to ensure the early issue of

the Maintenance Certificate.

(iii) MTR Contract 612

This Project formed part of the Tseung Kwan O Mass Transit Railway Corporation

(MTRC) Extension, known as Contract 612. The Project was awarded to the Joint Venture

Gammon-CHEC Joint Venture, that comprised Gammon Construction Limited, now known

as Gammon Skanska Limited and China Harbour Engineering Company (Group), which

formed part of a Mainland Chinese company, namely, the Zhen Hua Group of Companies.

The project value was approximately US$100 million and was managed as an integrated

Joint Venture, wherein the work was carried out under one corporate organisation, during

which the project management and financial control was handled by senior site personnel.

The construction works comprised of a pair of running-bored tunnels together with a

section of approximately 90 metres long-cut and cover tunnels. The new tunnels were then

connected to the existing MTRC railway tunnels. Additionally, the project also included

4


(Continued …)

(iii) MTR Contract 612 (Continued …)

significant site formation works, including slopes, drainage, foundation excavation, fillings,

retaining walls and subsequent site investigation for future housing development, some of

this work of which was entrusted to the Hong Kong Housing Authority. The work

commenced in early 2000 and was completed in late 2002.

(iv) East Rail Extension, Permanent Way (CC-1850)

This Project was constructed for the Client, The Kowloon-Canton Railway Corporation.

This Joint Venture included three Partners, namely, Chun Wo Construction and

Engineering Company Limited (ChunWo), Henryvicy Construction Company Limited and

China Railway Construction Corporation(CRCC). The first two companies are Hong Kong

owned family businesses. Chun Wo has an annual turnover of around US$400 million

whilst Henryvicyís is much smaller with an annual turnover of US$20-$30 million. China

Railway Construction Corporation is the Hong Kong branch of a Beijing based, PRC

company engaged mainly in railway construction projects throughout mainland China.

CRCC’s annual turnover is much larger than the other two partners, but is playing a less

proactive role in the execution of this project, their main contribution being the sourcing of

suitable products from mainland China. The project value is estimated to be approximately

US$50 million, and the expected completion date is December, 2004. The works comprises

the construction of East Rail Extensions, Ma On Shan, Tai Wai Maintenance Centre and

5


(Continued …)

(iv) East Rail Extension, Permanent Way (CC-1850) (Continued …)

Tsim Sha Tsui Extension inclusive of all trackwork along the routes. The trackwork along

the Ma On San route is 11.5 km of double tracks, mostly on viaduct, but 3.2 km is at-grade.

The at-grade tracks are conventional ballasted tracks, for reasons of economy of

installation, but the tracks on the viaducts is described as a Floating Slab Track (FST).

The Hong Kong Government’s Environmental Protection Department have set high

standards of noise attenuation. This standard could only be achieved by the use of the

expensive FST system which consists mainly of precast concrete slabs set in and

surrounded by rubber bearings. A composite sandwich of ductile iron with a natural rubber

core forms the baseplates used to support the rail and fixed to the precast units. In the Tsim

Sha Tsui section, the track is in tunnel and Low Vibration Track (LVT) is used for the

greater part, except for a short length where FST construction is used, because of the

proximity of buildings. In LVT track, the rails are fixed to a precast block that is enclosed

on the four sides and the bottom in a rubber boot which is set in concrete. This form of

trackwork requires less maintenance than a ballasted track but has enough resilience to

suppress the noise where tracks are far enough away from buildings.

This is also a fully integrated joint venture with commercial issues entrusted to the senior

management team which reports to a Joint Venture Board. Most of the work has being

undertaken by direct labour, allowing direct control over the labour and plant, enabling the

6


(Continued …)

(iv) East Rail Extension, Permanent Way (CC-1850) (Continued …)

Joint Venture to more easily manage the considerable interfaces with Civil and E&M

contractors, that are a particular importance on urban railway trackwork contracts. Interface

management and the associated programme management makes trackwork construction

projects significantly challenging in infrastructure projects.

The Senior Management is lead by a Project Manager who is experienced in international

joint venture management and who is independent of the three Joint Venture partners. The

other senior staff are the Commercial Manager who is from Chun Wo, the Technical

Manager from Henryvicy and the Project Engineer is from CRCC. Chun Wo has provided

the bulk of the site office administrative and civil works management staff.

0

Appendix F: Descriptive Raw Data of Study Two Participants (n = 40) Based on the Strategic Alliance Contracting Inventory (SACI)

Gender Education Type of JV ProjectParticipant No. AgeMale Female 3.1 3.2 3.3 3.4 3.5 3.6

Company Job Title Years inCurrent Job 7.1 7.2 7.3 7.4

1-British 55 1 1 GSL ExecutiveDirector

3 1

2-HKChinese 59 1 1 GSL Senior ProjectManager

2.5 1

3-HKChinese 48 1 1 GSL ConstructionManager

2 1


2 1

5-British 51 1 1 GSL CEO 7 1


5 1

7-PRC-Chinese 39 1 1 CHEC Director/Gen. Mgr.

18 1

8-PRC-Chinese 40 1 1 CHEC ManagingDirector

5 1

9-British 62 1 1 CHEC Director 10 1


15 1

11-French 45 1 1 DTP CommercialDirector

2 1

12-French 39 1 1 DTP ManagingDirector

1 1


4 1

14-British 57 1 1 GSL Chief QuantitySurveyor

3 1

15-HKChinese 40 1 1 GNJV Deputy Admin.Manager

2 1

16-HKChinese 42 1 1 GSL Site QuantitySurveyor

10 1

17-British 60 1 1 CHCJV Project Manager 3 1


13 1

19-HKChinese 38 1 1 R3CC ContractAdministrator

3.5 1

20-British 41 1 1 NCC Quality &Environmental

Manager

4 1

1

Appendix F (Continued …)

Gender Education Type of JV ProjectParticipant No. AgeMale Female 3.1 3.2 3.3 3.4 3.5 3.6

Company Job Title Years inCurrent Job 7.1 7.2 7.3 7.4

21-HKChinese 40 1 1 GSL Group Solicitor& Company

Secretary

12 1

22-PRC-Chinese 38 1 1 CHEC Project QuantitySurveyor

16 1

23-HKChinese 38 1 1 R3CC E&M Engineer 7 1

24-PRC-Chinese 35 1 1 GSL Senior ProjectEngineer

4 1

25-PRC-Chinese 45 1 1 CHEC Senior QuantitySurveyor

10 1

26-HKChinese 25 1 1 GSL Assist. QuantitySurveyor

2 1

27-French 59 1 1 DTP Deputy OverseasConstruction

Director

10 1

28-British 62 1 1 T8JV Project Manager 2 1

29-HKChinese 57 1 1 GSL Director 3 1

30-Japanese 56 1 1 NCC CommercialDirector

9 1

31-HKChinese 42 1 1 GSL Senior QuantitySurveyor

14 1

32-HKChinese 52 1 1 GSL CommercialManager

4.5 1

33-PRC-Chinese 33 1 1 CHEC ManagingQuantitySurveyor

1 1

34-HKChinese 40 1 1 GSL Project Manager 2 1

35-PRC-Chinese 27 1 1 CHCJV Section Manager 4 months 1

36-HKChinese 68 1 1 Henryvicy Director 4 1

37-PRC-Chinese 49 1 1 CHCJV Quality Manager 3 1

38-HKChinese 29 1 1 CHCJV Section Manager 2 1

39-HKChinese 49 1 1 CHCJV ConstructionManager

3 1

40-HKChinese 49 1 1 GSL CommercialManager

2.5 1

2


Nature of Relationship Within JV Project Foreign Partners Involved Within JVParticipant No.

8.1 8.2 8.3 8.4 8.5 Japanese Chinese British French Others

1 1 1 1

2 1 1 1

3 1 1 1

4 1 1

5 1 1 1 1

6 1 1 1 1 1 1

7 1 1 1 1

8 1 1 1 1

9 1 1

10 1 1 1 1

11 1 1 1 1

12 1 1 1 1

13 1 1 1 1 1

14 1 1

15 1 1 1

16 1 1

17 1 1 1

18 1 1 1 1

19 1 1 1

20 1 1

3


Nature of Relationship Within JV Project Foreign Partners Involved Within JVParticipant No.

8.1 8.2 8.3 8.4 8.5 Japanese Chinese British French Others

21 1 1 1 1 1

22 1 1

23 1 1 1

24 1 1 1 1

25 1 1 1 1 1

26 1 1

27 1 1 1

28 1 1 1 1

29 1 1

30 1 1 1

31 1 1

32 1 1

33 1 1

34 1 1 1

35 1 1

36 1 1 1 1

37 1

38 1 1 1

39 1 1 1

40 1 1 1 1 1

4


How was Enquiry made ? DateQuestionnaire

Completed

Participant No. JV Period(years)

How was Enquiry made ? DateQuestionnaire

Completed

Participant No. JV Period(years)

E-mail Letter Private E-mail Letter Private

1 27 1 07-Dec-02 21 25 1 15-Jan-03

2 10 1 03-Dec-02 22 5 1 16-Jan-03

3 10 1 04-Dec-02 23 10 1 10-Jan-03

4 10 1 11-Dec-02 24 unknown 1 12-Jan-03

5 25 1 17-Dec-02 25 12 1 13-Jan-03

6 25 1 17-Dec-02 26 4 1 20-Jan-03

7 20 1 18-Dec-02 27 50 1 22-Jan-03

8 20 1 18-Dec-02 28 4 1 17-Jan-03

9 20 1 25-Dec-02 29 2 1 20-Jan-03

10 25 1 18-Dec-02 30 20 1 23-Jan-03

11 20 1 19-Dec-02 31 25 1 27-Jan-03

12 20 1 23-Dec-02 32 10 1 26-Jan-03

13 20 1 20-Dec-02 33 10 1 28-Jan-03

14 10 1 20-Dec-02 34 10 1 14-Jan-03

15 10 1 08-Jan-03 35 2 1 05-Jan-03

16 20 1 08-Jan-03 36 20 1 21-Jan-03

17 3 1 10-Jan-03 37 unknown 1 21-Jan-03

18 25 1 10-Jan-03 38 4 1 21-Jan-03

19 8 1 13-Jan-03 39 20 1 19-Feb-03

20 40 1 13-Jan-03 40 unknown 1 07-Mar-03

0

Appendix G: Raw Item Response Data from the Strategic Alliance Contracting Inventory (SACI)†.

Participant

No.

Item 1 Item 2 Item 3 Item 4 Item 5 Item 6 Item 7 Item 8 Item 9 Item 10r Item 11 Item 12 Item 13 Item 14 Item 15r

1 5 3 2 3 5 5 4 2 5 5 5 5 4 4 4

2 3 2 2 2 5 2 3 5 4 5 5 3 2 5 5

3 5 2 4 4 5 6 4 2 5 4 5 4 3 5 4

4 4 4 4 3 5 5 3 5 4 3 5 2 5 5 2

5 4 1 3 1 6 6 2 2 6 6 5 1 2 6 5

6 2 4 5 4 5 5 2 3 2 3 4 3 3 4 2

7 5 2 4 5 5 5 5 2 5 3 5 4 2 5 6

8 5 4 5 5 6 5 5 3 6 2 5 4 3 5 5

9 6 2 3 1 5 5 3 1 3 3 5 5 3 5 4

10 3 4 4 3 4 5 4 4 5 3 5 2 4 6 2

11 4 1 5 3 5 4 4 2 4 6 4 3 1 5 4

12 5 2 4 2 6 5 5 2 5 5 4 2 2 5 4

13 5 4 5 3 5 6 2 5 4 5 3 2 5 5 2

14 2 4 3 2 5 6 2 3 3 3 4 2 4 3 5

15 4 3 4 3 5 5 4 4 3 3 5 2 2 4 2

16 4 5 4 4 3 4 2 3 4 3 4 5 4 3 2

17 4 1 2 5 5 5 6 2 6 5 6 6 1 6 6

18 2 5 5 5 5 6 3 2 2 2 5 5 5 4 5

19 5 3 5 3 5 5 2 4 4 3 5 3 1 5 5

20 5 3 5 3 5 5 5 2 5 4 5 4 3 5 4

† Items 10r & 15r – indicates original item scores reverse-coded.

1

Appendix G† (Continued …)

Participant

No.

Item 1 Item 2 Item 3 Item 4 Item 5 Item 6 Item 7 Item 8 Item 9 Item 10r Item 11 Item 12 Item 13 Item 14 Item 15r

21 5 3 4 3 4 5 2 2 4 3 4 2 3 2 5

22 5 3 2 4 5 5 6 5 3 3 2 4 3 4 4

23 2 2 5 4 5 6 3 1 5 5 4 6 2 5 4

24 2 2 5 2 5 3 3 2 4 3 3 2 4 4 4

25 5 4 5 3 5 5 3 5 6 3 3 2 4 6 1

26 4 4 3 3 5 3 3 2 3 2 4 2 2 4 3

27 5 2 3 4 5 4 5 2 5 4 5 2 2 5 5

28 3 2 3 5 5 5 4 2 3 2 3 6 3 3 5

29 4 2 5 4 5 4 3 2 5 3 5 5 4 2 2

30 4 2 3 3 5 5 5 1 4 5 5 6 3 5 5

31 5 4 5 4 4 2 5 4 3 2 2 1 5 3 3

32 4 3 3 2 5 6 2 3 4 5 5 6 5 4 5

33 3 5 6 6 1 6 5 6 1 1 3 6 3 1 1

34 1 3 2 2 5 4 5 2 4 4 4 4 2 4 3

35 5 3 4 4 5 5 6 5 5 3 5 5 2 5 5

36 4 2 6 4 6 5 5 1 6 3 5 5 2 5 5

37 4 3 3 3 4 3 3 2 4 3 4 4 5 3 2

38 6 4 1 5 6 6 6 4 2 2 4 6 2 6 2

39 2 2 2 3 6 5 4 3 5 6 6 4 2 6 6

40 4 4 2 4 2 3 2 5 2 3 5 4 3 2 2


2


Participant

No.

Item 16r Item 17e Item 18 Item 19 Item 20 Item 21r Item 22 Item 23 Item 24 Item 25r Item 26 Item 27 Item 28 Item 29r Item 30r

1 5 2 3 4 5 5 4 5 2 5 4 2 6 2 5

2 4 6 6 5 5 5 3 3 2 2 5 2 5 5 2

3 5 5 4 4 5 5 4 4 6 4 4 3 5 6 5

4 5 4 3 3 4 5 5 4 2 5 5 4 4 4 5

5 6 4 6 5 6 6 6 6 1 5 5 2 5 6 5

6 3 3 3 4 4 3 4 5 2 5 5 4 4 5 2

7 4 4 6 5 5 4 5 4 4 6 5 2 5 6 3

8 4 5 5 5 5 5 5 6 6 5 5 4 5 5 2

9 1 4 5 4 4 2 4 5 3 4 5 5 4 5 4

10 4 4 3 3 5 4 4 4 3 5 5 3 3 4 5

11 1 4 4 4 5 5 5 5 2 5 4 2 4 6 6

12 5 2 4 4 4 4 5 6 2 6 5 4 5 5 5

13 4 2 3 3 3 3 5 4 2 5 5 5 4 4 3

14 2 4 4 3 5 3 5 5 2 2 2 5 2 3 5

15 5 5 5 3 4 5 4 4 2 6 4 4 4 5 4

16 4 4 5 4 4 1 5 5 2 2 4 5 4 5 3

17 6 1 4 4 6 6 5 5 2 6 5 5 5 6 5

18 4 5 5 3 5 3 5 5 2 3 4 5 4 5 5

19 3 5 6 5 5 5 5 5 4 5 4 3 5 6 4

20 5 2 5 5 5 5 5 2 4 6 5 3 5 5 5

† Items 16r, 21r, 25r, 29r & 30r – indicates original item scores reverse-coded.

3


Participant

No.

Item 16r Item 17r Item 18 Item 19 Item 20 Item 21r Item 22 Item 23 Item 24 Item 25r Item 26 Item 27 Item 28 Item 29r Item 30r

21 5 3 5 3 4 2 4 3 4 4 4 3 3 4 3

22 4 2 5 3 4 3 3 2 6 2 5 5 5 5 3

23 5 5 5 5 5 3 4 4 4 5 5 5 5 3 3

24 4 2 4 2 2 5 5 3 2 5 3 3 3 5 5

25 1 6 5 6 4 4 6 2 6 4 6 5 5 5 6

26 5 3 4 3 4 3 4 4 2 4 4 3 4 5 4

27 5 2 4 5 5 4 5 6 4 6 5 2 6 6 5

28 4 2 5 5 5 2 3 5 5 6 5 2 5 5 4

29 4 2 2 4 5 2 5 5 2 3 5 2 2 3 4

30 4 4 5 5 5 6 5 5 6 3 5 2 4 6 5

31 2 4 4 3 3 1 5 1 1 1 4 5 1 2 2

32 5 2 2 4 5 5 5 5 4 6 4 2 4 5 5

33 2 5 5 5 5 1 6 6 6 6 4 6 2 6 6

34 5 3 4 3 5 2 5 5 4 3 3 2 3 5 4

35 6 6 2 2 5 4 5 3 2 5 5 5 5 6 2

36 6 5 6 5 6 2 5 5 6 1 6 1 6 6 5

37 3 5 3 3 3 3 4 4 2 2 3 3 3 4 3

38 3 4 1 3 4 4 5 2 5 3 4 5 3 5 3

39 5 6 5 5 6 5 6 4 4 4 5 4 5 5 1

40 3 5 3 2 3 3 4 4 1 5 3 4 2 4 5


4


Participant

No.

Item 31 Item 32 Item 33 Item 34 Item 35 Item 36 Item 37 Item 38 Item 39 Item 40r Item 41 Item 42r Item 43 Item 44 Item 45

1 5 5 5 4 5 5 4 5 3 2 3 3 5 6 4

2 2 2 5 6 5 4 3 5 2 5 5 5 5 4 6

3 4 5 5 5 5 5 4 5 2 5 5 4 5 5 5

4 3 5 5 4 4 5 5 4 4 5 5 2 4 5 5

5 4 4 5 2 5 6 6 5 2 3 5 2 6 6 6

6 4 5 4 2 3 5 2 3 4 5 3 3 4 3 4

7 3 4 2 3 5 5 4 4 2 3 4 4 5 5 6

8 5 5 5 5 6 5 5 6 2 5 5 5 5 3 6

9 5 2 2 3 3 5 5 2 3 4 3 3 4 4 5

10 3 4 4 5 4 5 5 4 4 4 5 3 4 4 5

11 4 4 6 4 5 4 4 5 2 4 3 2 5 5 4

12 6 6 6 5 5 5 4 5 4 4 3 3 4 4 5

13 4 4 5 4 4 5 5 4 5 5 4 2 4 5 6

14 4 2 3 1 3 5 4 3 2 5 2 2 3 2 5

15 3 4 4 4 4 5 5 4 4 4 5 2 4 5 5

16 4 5 4 2 2 5 4 5 3 5 4 2 4 4 3

17 6 6 2 6 5 6 6 4 1 1 6 2 6 6 6

18 5 5 5 4 4 6 5 5 4 5 5 4 5 4 5

19 5 5 5 5 4 6 5 4 2 4 6 2 4 5 5

20 5 5 5 5 5 5 4 5 3 4 5 4 5 5 4


5


Participant

No.

Item 31 Item 32 Item 33 Item 34 Item 35 Item 36 Item 37 Item 38 Item 39 Item 40r Item 41 Item 42r Item 43 Item 44 Item 45

21 4 3 4 3 4 5 3 4 2 4 3 5 3 3 5

22 2 4 2 2 4 5 5 4 4 5 4 3 3 5 5

23 5 6 6 1 5 6 5 6 5 6 5 5 5 6 5

24 2 4 4 3 4 5 3 3 2 3 4 3 3 3 4

25 5 6 2 3 4 6 2 5 4 4 5 3 5 5 5

26 2 4 4 4 4 5 4 4 3 3 5 4 4 4 5

27 5 6 5 5 5 5 5 6 2 2 5 3 6 5 4

28 2 5 3 4 3 6 2 4 2 3 4 4 5 3 5

29 4 5 3 2 2 5 5 4 4 3 3 3 4 5 5

30 3 4 3 5 5 5 4 5 4 3 4 3 5 5 4

31 2 4 4 4 2 5 4 2 5 4 4 2 3 4 3

32 5 5 4 2 4 6 3 3 2 4 4 4 5 4 5

33 6 4 4 2 3 6 4 1 5 6 6 4 5 5 5

34 3 5 5 4 4 5 2 5 2 3 2 2 5 2 5

35 3 5 5 5 5 6 4 5 4 4 2 3 5 6 2

36 4 5 6 6 6 5 5 6 2 5 5 5 5 6 6

37 4 2 1 3 3 4 3 2 2 3 4 3 4 3 4

38 4 4 2 6 4 5 5 5 2 1 3 2 5 5 2

39 5 5 5 5 5 6 4 5 3 1 4 3 5 5 6

40 2 2 2 2 3 6 4 2 5 2 4 3 2 3 3


6


Participant

No.

Item 46 Item 47 Item 48 Item 49r Item 50 Item 51 Item 52r Item 53 Item 54 Item 55 Item 56 Item 57 Item 58 Item 59 Item 60r

1 5 3 4 4 5 4 3 5 5 5 5 5 5 3 2

2 5 5 4 4 6 5 3 5 5 5 4 4 5 5 2

3 5 4 5 4 5 5 3 5 5 5 6 3 3 4 2

4 5 4 4 4 5 4 5 4 5 3 4 2 4 4 3

5 6 6 6 5 6 5 2 5 6 2 5 2 6 3 3

6 4 4 4 3 5 2 2 4 4 2 4 4 5 5 3

7 4 4 4 5 5 4 6 3 4 2 5 5 5 5 2

8 6 5 5 5 5 4 3 5 5 3 5 5 5 5 2

9 3 3 3 5 6 4 4 2 4 3 5 5 6 5 2

10 4 5 3 3 4 4 4 3 5 3 4 3 4 4 3

11 5 4 4 3 6 4 3 5 5 3 5 4 6 4 2

12 5 5 5 5 6 4 4 4 5 4 5 5 5 5 2

13 6 5 5 2 6 3 3 5 5 3 5 3 4 5 2

14 4 3 5 5 5 2 3 2 4 1 4 3 4 2 2

15 5 4 5 3 4 4 5 4 5 3 5 2 3 4 3

16 2 4 5 2 6 4 2 5 5 4 4 3 3 3 2

17 6 6 5 5 6 6 5 2 5 6 6 2 2 2 1

18 4 4 4 5 6 5 5 4 5 2 5 5 5 5 2

19 5 5 5 5 5 5 3 5 5 3 4 4 3 4 2

20 5 5 4 5 5 5 4 5 6 3 5 4 4 3 3

† Items 49r, 52r & 60r – indicates original item scores reverse-coded.

7


Participant

No.

Item 46 Item 47 Item 48 Item 49r Item 50 Item 51 Item 52r Item 53 Item 54 Item 55 Item 56 Item 57 Item 58 Item 59 Item 60r

21 4 3 4 4 5 4 5 4 4 3 5 4 4 4 3

22 3 2 4 5 3 4 5 4 5 4 4 3 4 2 3

23 6 6 6 4 5 4 2 5 6 2 5 2 3 2 3

24 5 5 4 4 5 4 5 3 5 3 4 3 3 4 3

25 6 5 4 6 6 4 2 5 6 5 4 2 4 4 3

26 4 4 5 4 4 4 3 4 4 4 5 4 3 4 3

27 6 4 5 5 6 4 5 5 2 5 5 4 5 4 5

28 5 4 4 5 5 5 2 4 4 2 5 4 4 3 2

29 4 5 4 4 6 3 2 4 4 2 5 3 3 4 3

30 5 4 4 5 6 5 5 5 5 5 5 5 5 4 2

31 2 2 4 5 2 2 2 2 4 2 3 2 5 1 3

32 5 4 4 5 6 3 4 4 5 3 4 4 5 4 3

33 1 5 4 6 6 4 6 1 2 2 4 1 3 2 5

34 5 4 5 4 5 4 3 4 6 3 5 3 5 3 3

35 5 5 6 5 6 5 5 5 5 4 5 4 4 4 3

36 6 5 5 5 6 6 6 5 6 5 6 4 3 4 1

37 3 3 3 4 5 3 2 4 4 3 3 4 3 3 4

38 5 5 5 1 3 5 1 5 5 5 2 4 2 4 6

39 5 5 6 4 5 5 6 4 5 2 5 4 4 5 2

40 2 2 2 4 6 4 2 3 5 2 6 3 4 2 3


8


Participant

No.

Item 61 Item 62 Item 63 Item 64 Item 65 Item 66 Item 67 Item 68 Item 69 Item 70 Item 71r Item 72 Item 73r Item 74r Item 75

1 4 4 4 3 5 3 2 3 3 5 6 5 6 4 4

2 4 4 5 2 4 4 4 5 4 5 5 5 6 4 5

3 5 4 4 2 2 2 4 4 4 5 6 6 6 5 5

4 5 4 4 4 3 2 3 3 3 3 3 4 5 4 3

5 6 6 6 2 5 2 3 5 2 4 6 5 6 4 3

6 4 4 5 3 3 3 3 2 3 3 2 4 2 2 2

7 6 2 4 4 2 2 5 5 6 6 6 6 6 4 4

8 5 3 5 3 2 2 6 5 6 5 5 5 5 5 5

9 6 5 5 2 2 2 5 6 6 3 4 3 5 5 3

10 4 5 4 4 4 2 3 2 3 3 4 4 5 3 3

11 4 4 5 3 3 4 2 4 4 4 5 5 6 5 4

12 5 4 6 3 3 3 3 4 3 5 6 5 6 5 4

13 5 3 5 4 5 5 4 5 4 5 4 4 5 5 3

14 5 4 5 2 5 2 3 3 5 2 3 1 3 2 2

15 4 4 5 3 3 2 2 3 3 4 5 4 5 4 3

16 2 4 4 4 3 4 4 3 3 5 3 3 3 3 6

17 6 5 6 2 1 1 6 6 6 6 6 6 6 6 1

18 5 4 5 4 2 2 5 5 5 5 6 5 5 5 4

19 5 4 6 3 5 3 4 5 4 5 5 5 6 5 4

20 5 4 5 3 4 2 3 3 5 4 5 5 6 5 5


9


Participant

No.

Item 61 Item 62 Item 63 Item 64 Item 65 Item 66 Item 67 Item 68 Item 69 Item 70 Item 71r Item 72 Item 73r Item 74r Item 75

21 4 4 5 2 4 2 2 2 3 2 4 3 5 3 4

22 4 4 4 2 3 2 4 4 4 3 5 4 5 4 3

23 5 4 5 4 3 3 3 5 5 5 6 6 6 6 5

24 3 3 4 3 3 3 2 4 2 2 3 3 5 4 3

25 5 4 4 4 3 4 3 4 4 5 1 5 6 3 5

26 3 4 4 3 2 2 4 5 4 4 5 4 5 5 4

27 4 4 5 3 5 2 4 5 4 6 6 6 6 4 5

28 4 3 5 3 3 2 4 5 4 4 5 4 6 5 3

29 5 4 5 4 4 2 4 5 4 4 4 4 4 2 2

30 5 4 4 4 3 2 3 5 5 5 6 5 6 6 5

31 4 4 2 5 1 5 2 4 2 1 2 2 4 4 4

32 5 4 5 2 5 2 2 2 2 3 5 4 5 5 4

33 2 2 3 6 2 3 2 2 2 2 3 5 6 5 3

34 3 3 5 3 5 2 3 3 4 4 5 3 5 3 5

35 6 4 4 2 5 2 5 5 5 6 2 6 6 5 5

36 6 5 6 2 4 2 6 5 6 5 6 6 6 6 5

37 4 2 4 2 2 2 4 4 4 3 4 3 5 4 3

38 4 5 5 4 4 1 5 5 5 5 6 6 6 6 6

39 5 4 4 3 3 5 4 6 6 5 6 6 6 5 5

40 5 3 5 4 1 2 5 5 4 1 4 3 3 4 3


10


Participant

No.

Item 76 Item 77 Item 78r Item 79 Item 80 Item 81r Item 82 Item 83 Item 84 Item 85r Item 86 Item 87r Item 88 Item 89r

1 6 6 6 5 5 6 6 5 3 5 4 6 5 4

2 6 3 2 6 4 5 5 5 2 2 5 3 5 2

3 6 5 5 5 5 6 6 5 5 5 5 2 5 3

4 5 4 5 4 5 5 5 5 4 5 5 3 5 3

5 6 6 6 6 6 6 6 6 2 6 5 6 6 6

6 6 6 6 5 6 6 6 6 3 5 6 6 6 3

7 6 6 6 5 6 6 6 5 4 5 5 2 5 3

8 4 6 5 6 6 6 6 5 4 5 5 2 5 2

9 6 6 6 6 6 6 6 6 4 6 6 6 6 6

10 5 4 5 5 5 6 6 4 4 5 5 3 4 3

11 6 6 6 6 6 6 6 6 2 6 6 6 6 6

12 6 5 6 6 6 6 6 5 2 3 5 5 6 5

13 5 5 5 5 5 5 5 5 5 4 5 2 5 5

14 3 2 3 4 2 3 2 2 1 1 2 2 2 1

15 5 4 5 4 5 6 5 4 5 5 4 3 5 4

16 5 3 3 4 4 4 3 5 6 3 5 2 5 3

17 6 1 1 1 1 6 1 1 1 1 1 1 6 1

18 6 6 6 6 6 6 6 6 6 6 6 6 6 6

19 6 5 6 5 5 6 6 4 5 2 6 2 5 4

20 5 5 5 5 6 6 5 5 5 4 4 5 5 3


11


Participant

No.

Item 76 Item 77 Item 78r Item 79 Item 80 Item 81r Item 82 Item 83 Item 84 Item 85r Item 86 Item 87r Item 88 Item 89r

21 5 4 4 3 4 5 5 4 2 5 4 4 5 2

22 5 4 5 4 3 5 2 5 4 4 3 2 3 4

23 6 6 6 4 5 6 5 5 6 5 6 1 6 5

24 6 5 6 3 5 5 5 4 2 4 4 4 4 4

25 6 5 1 5 5 6 1 5 6 1 6 1 5 4

26 4 5 5 5 5 5 5 5 4 2 6 1 4 5

27 6 6 6 6 6 6 6 6 2 5 5 5 5 5

28 6 5 5 5 5 6 2 5 2 2 5 5 5 5

29 5 4 5 1 5 6 5 5 2 5 3 5 5 3

30 5 4 5 3 4 5 6 4 2 2 1 2 4 1

31 3 3 3 4 3 3 3 5 4 4 2 3 2 2

32 5 5 5 5 5 6 6 5 5 3 3 5 6 3

33 6 3 6 2 4 6 6 6 1 1 6 3 6 6

34 5 5 6 5 5 6 6 5 2 3 4 5 5 4

35 6 5 5 4 6 6 6 5 2 6 5 5 5 5

36 6 6 6 6 6 6 6 4 5 4 4 5 5 5

37 5 4 5 3 2 5 3 3 4 3 3 4 3 4

38 6 6 6 6 6 6 6 6 3 4 6 1 6 5

39 6 5 6 3 5 6 6 5 4 3 5 2 3 3

40 4 4 4 2 4 6 5 4 1 4 4 2 6 2


0

Appendix H: List of Internationally Peer-Reviewed Publications.

1. Johannes, D.S. (2000). Strategic alliance contracting relationships

between foreign and local contractors in Hong Kong. Conference

paper presented at the Fourth Annual AIPM Conference; Cairns,

Qld.

2. Walker, D.H.T. & Johannes, D.S. (2001). Organizational learning

intentions and joint ventures in Hong Kong infrastructure projects:

A pilot study. ARCOM Seventeenth Annual Conference; Salford,

UK, ARCOM.

3. Walker, D.H.T. & Johannes, D. S. (2003). Construction industry

joint venture behaviour in Hong Kong – Designed for collaborative

results ? International Journal of Project Management, Elsevier

Science. UK, 21 (1), 39 – 49.

4. Walker, D. & Johannes, D.S. (2003). Preparing for organisational

learning by HK infrastructure project joint venture organisations.

The Learning Organisation, MCB University Press. UK, 10 (2),

106 – 117.

derick thesis-all

Education

knowledgebased importanceof

rmit university

findings of study

doctoral research

interorganisational

organisational culture

organisational learning

future investigative