2025 Reports

Keep Your Enemies Closer: International Joint Ventures in the Global Network of Japanese MNCs

Ito, Kiyohiko; Kiyota, Kozo

We analyze specific attributes of international joint venture (IJV) subsidiaries by investigating their organizational placement and strategic importance. Using network analysis and a framework of global integration and local responsiveness, we find that IJVs are closely positioned to the headquarters, but they are not the main central nodes for the international operations of large Japanese multinational companies. The results suggest that IJVs are not tightly integrated with other foreign subsidiaries and thus do not play a key strategic role in the coordination in foreign operations. Instead, the headquarters of Japanese multinational companies very closely control or monitor the IJV operations. Such unique roles of IJV subsidiaries indicate that although they may not play key strategic roles as centers of foreign subsidiary networks, they are structured in a way that facilitates organizational learning for the headquarters. We identify the relative importance of individual IJVs and other foreign subsidiaries quantitatively, revealing the structural configuration of the foreign operations.

Keywords: International Joint Venture, MNC Network, Organizational Learning, PageRank Centrality