University of Oulu

Managing international partner opportunism : roles of trust and culture in Indonesia

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Author: Kettunen, Virve1
Organizations: 1University of Oulu, Oulu Business School, Department of Management and International Business, International Business
Format: ebook
Version: published version
Access: open
Online Access: PDF Full Text (PDF, 1.1 MB)
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Language: English
Published: Oulu : V. Kettunen, 2015
Publish Date: 2015-03-12
Thesis type: Master's thesis
Tutor: Mainela, Tuija
Reviewer: Mainela, Tuija
Hermes, Jan
International partnering is an attractive internationalisation vehicle and one of the main concerns when managing international partnerships is opportunism. Opportunism is self-interest seeking behaviour which aims to gain benefit at the cost of the partner. In international partnerships the cultural differences complicate the management of the partnership and induce opportunistic behaviour. This study aims to get a better insight of international opportunism and its management. There are both formal and relational governance mechanisms to curb opportunism, and in this paper the relational governance mechanism of trust is investigated, as previous research indicated trust to be the most efficient governance mechanism in international partnerships with high environmental uncertainty. Furthermore the impact of culture on opportunism and trust building were the main interests. These issues were studied in Western-Indonesian partnerships, the focus on managing Indonesian partner opportunism from the Western firm’s viewpoint. This is a qualitative multiple case study, which aims to get a deeper understanding of the phenomenon of international partner opportunism. Data was obtained through semi-structured interviews with relevant representatives of the Western companies partnering with Indonesian firms. Data was coded and analysed accordingly. It was found that for managing foreign partner opportunism in Indonesia relationship building and trust are essential factors. Relationship building requires a lot of socializing and rather informal business relationships. Cultural differences impact both opportunism and the building process of a trustful relationship notably. The main elements noted in the Indonesian culture were differences in values, communication style and mind-sets. These aspects affect and complicate the process of building trust and good quality relationship, besides affecting the level of opportunism. Managers should acknowledge these elements of cultural differences and find ways to mitigate their unfavourable effects. This study contributes to research by offering a qualitative study on international opportunism and this way enriching the knowledge of the subject. Especially pointing out the critical elements of culture regarding opportunism and trust building truly enhances the current research. The contributions can be used to guide Western managers aiming to develop a partnership in South-East Asia.
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Copyright information: © Virve Kettunen, 2015. This publication is copyrighted. You may download, display and print it for your own personal use. Commercial use is prohibited.