Application of conflict solving strategies to enhancing the performance of TC-STC, a Holland-Vietnam Joint - Venture Vompany

Abstract

TC-STC, a Vietnamese-Dutch JV, was established in 2012 in Vietnam, is currently specializing in consulting and developing human resources in the industries of ports and logistics. The company had not been able to obtain positive results until 3 years ago, experiencing consecutive losses during the first 3 years of operations. The top management has been struggling to find ways to make the circumstances better. Nonetheless, over time, differences or even conflicts among members of management board have occurred, which hindered the JV‟s from coming to important decisions. Therefore, this paper tries to give TC-STC suggestions about how to manage the conflicts so as to enhance the operations of the JV. Two primary goals of the thesis include (1) to examine and analyze the existing circumstances of TC-STC (2) to recommend a suitable conflict solving strategy for the J.V. The research creates a conceptual model to examine the connection of 3 variables: international J.V‟s operational performance, national culture, and conflict resolution strategy. For the research methodology, a mix method approach was used to study the issues. Secondary data were collected via desk research, website, and other internal sources. Primary data were gathered through conflict management tests and qualitative interviews with the managers of the J.V as well as the managers of other international J. Vs (Vietnamese partners with foreign partners). The data collecting was handled via qualitative content analysis as well as non-probability analysis to produce the outcomes. The findings indicate that (1) the primary objectives and expectation of the J.V 2 partners are not perfectly aligned. Thus, the J.V Company has been operating under pressure from the two parties, resulting in lower-than-expected operational and business performance; (2) The Dutch managers tend to the confrontational conflict management styles whereas the Vietnamese counterparts prefer to use the non-confrontational one. The dissimilarities in national culture also make it hard to create or reach a mutual commitment in TC-STC owing to the fact that perceptions of commitment of both parties are not the same. (3) the Vietnamese and Dutch members of board of management of the J.V Company are still struggling to address the conflicts because of certain limitation on communication as well as the exchange of information, lack of trust and commitment, lack of consideration for partners‟ needs and concerns. (4) a mixture of Problem-solving strategy and Compromising strategy can be used in order to address the conflicts in the Company amid the existing situation. The recommendations to TC-STC is that the Company should adopt a combined conflict resolution strategy of Problem-solving strategy and Compromising strategy (although Legalistic strategy received a little bit higher score than Compromising strategy but all of the interviewees emphasized that it would be the last resort) in order to rectify the existing conflicts and to get ready for potential conflicts in the coming days. First of all, so as to ensure a full achievement of this strategy, it is necessary for both partners to align the objectives and expectations to identify the gap between them, from which a plan for improvement can be made. Both parties should be able to reach agreement on objectives in order to adopt a new way as to how the joint venture will work. The two partners should commit themselves to the agreement. Second of all, it is advisory for the management to set up short-term and long-term goals for the Company. A strategic communication plan which also consists of the conflict resolution strategy will follow up so as to regularly update the work progress and exchange information. Last of all, conducting inter-cultural training in order to avoid unworthy conflicts, misunderstanding and to identify trust or commitment signalling accurately should be executed by the J.V because it can result in greater trust and strong commitment between parties.