L'influence des facteurs structurels sur le choix de mode de présence

Section 3 :

Specific factors of joints ventures

This study will relate to two factors which are the size and the experiment to try to determine their impact on the choice of the mode of presence abroad.

1 cuts it

1.1 cuts it partners

According to the article of Hemant (2000)^48(*), the research made on this variable shows that the size of the firms which take part in a joint venture has a great influence on the performance of the operation of the latter. It is obvious that the costs projected to ensure the performance vary from large with a small company.

According to Agarwal and Ramazwami (1992)^49(*), the modes of investment would be preferred by the firms which are larger and have more multinational experience and in countries which are perceived like having a potential of higher market, therefore, if the two factors are high the companies have a preference for the modes of investment, if not they prefer not to engage.

These same authors show in their study the preference of the great multinationals to choose the investment like mode of entry in the markets with low potential. Indeed they noted that the small firms having limited multinational experience prefer to enter from the markets perceived like having a potential raised through the joint venture. That indicates that the TOKEN ENTRIES E, less than the tested multinationals have needs to supplement their requirements in resources with an aim of serving a potentially gravitational foreign market.

Moreover, the resources are an explanatory factor among others. They are not sufficient to explain the choice of each partner as regards mode of presence. The resources themselves do not constitute a mobile, they must be accompanied by the will to engage them with the development of a foreign market.

High resources made it possible to the decision makers to select a mode of entry for the target country among a broad range of alternatives that the decision makers to scanty means. This fact a company with raised resources, taking into account its size, is more likely to choose modes of entry intégratifs.

1.2 cuts it market

The size present and projected market of the target country is of an important influence on the choice of the mode of presence.

According to Davidson and Mc Fetridge (1985)^50(*), the size and the maturity of the market such as they are measured are not significant factors in the choice between the licencing and the direct investment.

Agrawal and Ramaswani^51(*) noted that the firms preferred to enter the markets with more potential by using modes of investment. They tend to avoid the markets who have a risk of raised investment, while only choosing to export at the markets who have a high contractual risk, that nevertheless they could invest in markets relative with low potential if their strategic objectives dictates it.

Anderson E & Gatignon H (1986)^52(*) consider like starting postulate that the market to be penetrated has at least the potential to cover the expenses of a mode of entry with high control. If it is not the case, a high control cannot be considered.

An article emitted by Haiyang and Michael (2002)^53(*) shows that :

cut it foreign market influences the decision of the choice of the mode of presence ;

- When the size of the market increases, the benefit of internationalization will increase ;

it fixing of the expenditure of internationalization can separate from one with dimensions to another the width of the market what will bring the benefit connected to the investment to increase highest possible. Haiygang and Michael (2002) established the following assumptions :

- Assumption 1 : The size of the partners has a positive effect on the level of investment ;

- Assumption 2 : The size of the partners has a positive effect on the level of control.

2- The experiment

2.1-L' international experiment

It is the degree of engagement of a company in an international activity which is reflected in the role granted to the foreign markets in the total strategy, the statute of the international organization, and the attitude of the managers. For the majority of the companies, international engagement increases as the international experiment is formed over a long period. Success in the foreign countries would encourage international engagement, which would generate even more experiment. ^54(*)

According to Koenig (1994)^55(*) the experiment comes from :

it development of the aptitude as regards preparation of the negotiations, research of information necessary and the exploitation of various methods of outcome of conflicts ;

it contribution in the improvement of the technologies acquired in the direction of a better response to the problems of the local environment ;

it circulation of the ideas and the diffusion of the practices constitutive of new competences ;

The experimental knowledge- the accumulation of knowledge of the firm on foreign specific markets is a critical resource seen that even if it is necessary to operate in any market it is not easily acquired.

In the first stages the firm should learn how on the local conditions in order to reduce its dependence of the local organization then, it would move towards the distant countries after having established a presence in closer countries.

The firms at the time of the first international stages of the expansion, prefer the countries by far culturally and geographically close relations, and if it meets cultural barriers when it extends on the international level it must learn from its last experiment.

When a firm begins a new entry profits more of the experiments passed with the expansion in the same country, compared with a less extension of the preceding experiments in the area which is closer to the country of origin, this beneficial effect of the experiments is due to the training on common cultural characteristics. ^56(*)

2.2 it role of the experiment in the choice of the mode of presence

According to Gatignon and Anderson^57(*), the FMN choose the subsidiary companies integrated into hundred percent as the cumulative experiment (measured by the number of foreign markets penetrated on this date) increases. Of the same Davidson notes as the aggregate experiment (measured by the number of foreign markets), as well as an industrial experiment in the country host increase the preference of the company to choose the subsidiary companies at 100%.

The theoretical explanation for a positive relation between the experiment and the degree of control is focused on uncertainty. The the least tested firms perceive a considerable uncertainty, an exaggerated risk and underestimated incomes and avoid, consequently, engaging of the important resources and assuming control.

Other authors suggest a negative relation between the international experiment and the desire of control. Daniels et al.^58(*), observed a tendency among the companies in addition to-mother which start by investing in a total control and end up dividing it as soon as the operation is established. The relevant question to be posed would be to know if the experiment has a positive, negative or null effect on the degree of investment and the degree of control wished by the firm.

Two assumptions are to be checked :

- Assumption 3 : The experiment of the partners has a positive effect on the level of investment ;

- Assumption 4 : The experiment of the partners has a positive effect on the level of control.

* ⁴⁸ Hemant M (2000)  : «  Configuration off international joint venture  », International Management Review, flight 40, 2000/2, p 107-140

* ⁴⁹ Agarwal S & Ramazwami S NR: «  Choice off Foreign Market Entry Mode: Impact off ownership, Hiring and Internationalization Factors ", First Quarter 1992, p 1-27

* ⁵⁰ Davidson & Mcfetridge (1985) COp-cit

* ⁵¹ Agarwal S & Ramazwami S NR (1992) COp-cit

* ⁵² Andeson E & Gatignon H: «  Modes off Foreign Entry; translation costs analysis and proposals " Newspaper off International Business Studies, Fall 1986

* ⁵³ Haiyang C & Michael Y HU (2002): «Year analysis off determining off entry mode and its impact one performance», International off Business Review 11, pp193-210

* ⁵⁴ Zmerli K (1998) COp-cit

* ⁵⁵ Koenig G  : «  The organisational training  » location of the places, French Review of Management, January-February 1994

* ⁵⁶ Zmerli K (1998) COp-cit

* ⁵⁷ idem

* ⁵⁸ City by Erramili MR. K & Roa C P  : «  Choice off foreign market entry modes by service firms  : role off market knowledge " flight 30, p 135-149