Managing the image of a joint venture.

• Author: Ackerman, Laurence D.

How identity plays a role in the success of an alliance, and how to ensure that the identity strategy and its implementation actively support the venture.

Joint ventures are proving to be one of the most important business strategies in the decade of the '90s. Increasingly, U.S. corporations are marching two by two onto the global landscape in joint ventures with foreign companies. Looking for such tangible benefits as increased profits and expanded avenues for growth, companies are moving rapidly to lock in relationships.

Virtually overnight, these alliances bring together people, products, technology, and capital that only yesterday functioned independently. More frequently than ever before, companies that once were rivals are now signing pacts ensuring their future as partners. Indeed, joint ventures are changing the business landscape -- and how they identify themselves can significantly influence their transition from start-up endeavors to established enterprises.

In a recent survey, entitled Joint Ventures: Global Pioneers of the '90s -- New Challenges for Managing Image, our firm probed for the first time the role identity management plays in shaping the success of a strategic alliance whose need for differentiation and perceived stability are key elements in the success equation.

In many ways, joint ventures are like arranged marriages, where the economic stakes are high for both partners. What makes these marriages successful is, not surprisingly, a crucial question for everyone involved. This question becomes all the more critical given the fact that the majority of joint ventures today are being formed as permanent enterprises. While these new enterprises may be privately held by parent corporations, those who run and work in joint ventures operate knowing full well that their future is essentially in their own hands.

This focus on independence leads logically to the question of identity. Who are we? What do we stand for? Should we simply adopt our parents' names and, by extension, their values, or establish our own? And, most importantly, how does identity contribute to the success of the joint venture?

One thing is clear: Joint ventures that establish separate identities from their parents' tend to be more satisfied with the results than those that simply adopt the names of the parent corporations. In fact, while 38% of executives surveyed said that the identity program has been "very effective," the number increased to 48% in...