 Students, we are discussing about international joint ventures. And in this topic, we are going to discuss the development stages of the international joint venture and what are the different HR challenges in these evolutionary stages. You may remember that we discussed that there are four stages in evolutionary stages in merger and acquisitions as well. So similar to that, there are evolutionary stages in international joint venture also. These stages are classified and termed as formation, development, implementation, and finally, advancement and beyond. You can see from the nomenclature of these four stages that first one is formation in which the IGV is formed, second one is development, third one is implementation, and fourth one is advancement and beyond, which advances for development and growth. So it is quite self-explanatory what these four stages are concerned about. So in the formation stage, the features of formation is identifying the reasons why two companies would be going for an international joint venture, selecting dedicated managers, finding potential partners, and negotiating the arrangements. So this is the features of the formation stage. Then the features of the development stage is locating the international joint venture where the facilities are going to be located, in which country, in which city, in which area, in which industrial zone, will they be taking over some already established facilities or will they be creating new facilities for the joint venture? What is going to be the mode of operation? And then establishing the vision, mission, strategy, and structure, so designing all these things, defining your mission and vision, your strategy, and then, according to that strategy, the structure of the organization, these are the features of the development stage. Then the third phase is that of implementation. Whatever the plans, whatever the vision, mission, strategy, and structure has been decided, it has been planned, it has been chalked out, that is then implemented, implementing that structure, implementing that vision and mission. And then designing policies with a local, global consideration, because we are talking about cross-border alliances, we are talking about international firms coming together, so there has to be a local advantage, there has to be a local requirement, and there has to be a global advantage and a global requirement. So matching the global and local consideration, that is taken care of in the implementation stage. And then finally, the fourth stage is advancement and beyond in which you advance with your plans, with your actions in which you advance for growth and expansion, so advancement and beyond, whatever then is the next phases of that company and the fate of that company is decided in the next phases. So what happens in the advancement and beyond phases, most important features is learning from the partners, which is one of the most important reasons why two firms, they come together, they want to learn about the market, about the products, about the processes, about the national culture, about the local dynamics, and the local firm that wants to learn about the global dynamics, the global firm wants to learn about the local dynamics, so it's all about learning. So learning from the partners, transferring new knowledge to the parents, then that is one of the important features that whatever is being learned in that international joint venture, then that knowledge is transferred back to the parent firms and transferring new knowledge to other locations as well. So that is possible that the parent firm then uses the knowledge that they have gained from that particular country, that parent firm transfers that knowledge to another country, another location, another setup, so these are the features of the fourth stage which can progress through a number of stages then later on. Stages of development, they are not independent of each other, it's not that what happens in formation will remain in formation and what happens in advancement, it will remain in advancement. The activities which are taken place in the prior phases, they affect how the next phase is initiated and how what happens in the subsequent stages. So they are all interdependent on each other. What happens in the formation is going to affect what happens in development and what happens in development is going to affect what happens in the implementation. So they need to be aligned together and what happens in earlier phases is going to significantly affect what happens in the later phases. It is already a complex situation and complexity, it can increase depending upon how many number of parent companies there are and how many number of countries are involved. So if there are, the more companies are involved in that national joint venture, the system and the dynamics are going to become more and more complex and similarly, if more countries are being involved then the complexity is also going to raise. HR challenges in these particular phases, they are basically related to creating mutual learning opportunities which should be focused throughout the stages. So the HR function, HR department of the organization that needs to be proactive about the learning aspect and it should be mutual learning. It should not be one way learning. Learning should always be mutual among the partners. Then because all learning processes are communication processes. You know that for learning communication is must. Communication of words, communication of knowledge, communication of gestures, verbal communication, non-verbal communication, virtual communication. Learning always takes place through communication. So since all learning processes are communication processes and communication is definitely done by people, nobody else can communicate. So communication is done by people between people, for people, by the people. So people skills and people management is most important in this learning process and it is most important in developing the right kind of communication strategies so that knowledge is communicated within the partners, it is communicated back to the parents, it is communicated to other locations as well. And this encompasses all activities of the HR function. Learning takes place in all functions of the HR function. The HR function has to, all activities of the HR function, they facilitate the learning process. So the way you manage performance, the way you manage staffing, the way you manage training and development, that is going to affect how your learning takes place in your organization. So it encompasses all activities of the HR processes, HR function. Then a strategic approach requires a strong compatibility of the HR activities as well as with the joint venture strategy. This is something which we have already discussed that there has to be alignment between the HR strategy and the organizational strategy and the alignment is required to carry forward the vision, mission and objectives of the organization correctly through the human resources of the organization. The structure, the way you structure your organization, it will impact on the learning and knowledge management process. If your structure is too mechanistic, if your structure is too inflexible, if your structure is too bureaucratic, you cannot expect the organization to be organic and flexible and ready for learning. If you want to go for something which, if you want to go for an organization which learns, which is a knowledge organization, which is a learning organization, the structure needs to facilitate all these things. So if you have a bureaucratic structure, communication is definitely going to be hindered, it is going to be slow, it is going to be going from different various steps and with that kind of communication, you cannot expect to be a learning organization. So the structure of your organization is definitely going to affect the way you learn and transfer knowledge in your organization. So that is one of the most important aspects of the human resource function to establish the right kind of structure for your organization. And then recruiting, selecting and managing senior staff is very much critical. So this is the function of the human resource department of both the parent firms or more than, if there are more than all the parent firms to hire the right kind of senior management. If the right kind of senior management is there, looking after the joint venture, the new firm in the right way, implementing the strategy of the firms which are coming together, these are the people who are going to drive the progress of the international joint venture and that is going to affect how the joint venture is successful and effective in the new environment. So senior management selection, recruitment and retention is one of the most critical features of the HR function of an international joint venture and it is important in all the phases, in all the development phases of the joint venture. So this was a summary of the development stages of an international joint venture and what are the HR challenges related to these development stages.