The coevolution of trust, control and partner selection in Malaysia–Indonesia strategic alliances

• Main Authors: Abdul Ghani, Ahmad Bashawir, Subhan, Muhammad
• Format: Article
• Language: English
• Published: Common Ground Publisher 2009
• Subjects: HF Commerce
• Online Access: http://repo.uum.edu.my/5553/1/Journal_ACCEPTED_-_The_Global_Studies_Journal.pdf; http://repo.uum.edu.my/5553/; http://gsj.cgpublisher.com/product/pub.184/prod.94

In recent years, international strategic business cooperation has attracted great attention in both international management theory and practice. Several prominent examples demonstrate that inter-firm alliances can no longer be viewed as second best solutions but must be recognized as efficient forms of internationalization. Strategic alliances are a common strategy for entering new countries. More recently, the Malaysian press has been inundated with news about the emergence of many more such alliances between Malaysian and Indonesian companies. Direct investment in Indonesia involves a relatively high cost as well as benefit for Malaysian companies. In this article, the specific management problems of international strategic business cooperation between Malaysian and Indonesian companies including the criteria used by Malaysian companies to select their business partner, how the relationship management varies with the characteristics of the Malaysian partner and the resulting effects on the process of trust building are analyzed and a systematic approach for their solution is presented. This article ends with a short summary and the managerial implications for business managers are highlighted.