International Joint Venture System Complexity and Human Resource Management*

Randall Schuler Rutgers University and GSBA Zurich Ibraiz Tarique Pace University

Chapter to appear in I. Björkman and Günter Stahl (eds.), Handbook of Research in IHRM. (London: Edward Elgar Publishing, 2005)
* The authors wish to thank S. Jackson, M. Moelleney, B. Kugler, G. Bachtold, W. Harry, J. Ettlie, D. Osborn, Y. Gong, and I Björkman for their suggestions and commentary in the development of this chapter. © Randall S. Schuler and Ibraiz R. Tarique.

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International Joint Venture System Complexity and Human Resource Management
An increasing number of organizations are entering new global markets as they seek to develop and sustain a competitive advantage in today’s highly competitive global environment (Taylor, 2004; Ernst & Halevy, 2004). To accomplish this international expansion, organizations can and do use many different market entry strategies (Narula & Duysters, 2004; Briscoe & Schuler, 2004; Beamish & Kachra, 2003; Newburry & Zeira, 1998; Child & Faulkner, 1998). Prior research has shown that cross-border alliances, particularly international joint ventures (IJVs) are perhaps the most popular means of international expansion (Ernst & Halevy, 2004; Briscoe & Schuler, 2004; Schuler, Jackson, & Luo, 2004). Despite their popularity, however, IJVs are difficult to develop, organize, and manage. Research has shown that a majority of IJVs fall short of their stated goals leading to costly failures (Schuler et al., 2004; Luo, 2000; Evans, Barsoux, & Pucik, 2002). While external environmental forces like the legal system, political system, state of the economy, and organizational forces like partner differences and contract terms contribute to failures, a large proportion of IJV failure can be attributed to inefficient management of human resources (Arino & Reuer, 2004;