Open, Transparent, Secure – Shouldn’t Every Joint Venture Be Like This?
On paper, joint ventures (JV) have many advantages that should get corporations and their finance directors excited. Whether it’s a matter of multiplying forces or putting complementary skillsets together, the whole should be greater than the sum of the parts. In other words, added value should be created. However, the map (or the business plan) is not the territory. I if the territory that is worth hundreds of billions of dollars in revenue does not generate a sufficient level of profit, the joint venture process needs re-examining until it does. In that case, where should you start looking? And what needs to be addressed as a priority?
Results of analyses of joint venture success and failure have been published in the Harvard Business Review. Over the space of a decade, comparing results from 1991 and 2001, JV success rates do not appear to have changed much. They moved from only 51 percent (1991) to just 53 percent (2001) for surveys of as many as 2,000 JV projects. The main reasons given were: wrong strategies, incompatible partners, inequitable/unrealistic deals, weak management, and a poor launch plan and execution. In the 2001 report, authors James Bamford, David Ernst, and David G. Fubini, pinpointed a poor launch planning and execution as the critical factor overlooked in most cases.
Almost 15 years down the line, what’s changed? A joint venture is still a project. It needs smart planning, mutual agreement on strategies, strong yet flexible management, and careful accompaniment through the first 100 days or so of the launch, which typically make or break the whole project. All of this needs open and transparent communication between each JV partners and the team managing the joint venture. All parties must be involved equitably to avoid one partner monopolizes the process.
While the challenges continue, there is now a solution to handle this project-style communication in an open, neutral, and balanced way. These characteristics define LoadSpring™ with its cloud-based portal, the SpringBoard™, which enables faster and easier JV decision-making. With this market leading technology, joint venture partners have access to the same dashboards and real time information.
Better yet, the SpringBoard offers users excellent security in several ways. information is protected and only made available to authorized users. In addition, the SpringBoard portal relieves JV partners of any worry about external users connecting to their own internal systems. Combining these factors also means that JV partners can be confident they all have fair access to the JV information and that no single partner is accruing any unfair advantage. Openness, transparency and security are critical enablers of success over the lifecycle of the JV, particularly in the launch phase, when decisions need to be taken in real time and by mutual agreement. The Cloud-based Project Management Solutions provided by LoadSpring can make a significant positive impact to the success of their JV partners.