Joint Venture In Construction Industry: Significance, Technology Transfer - An Essay.

This research focuses on the joint venture in the construction industry in the world and its significance to the international industries of construction. It also covers how data were collected in a different country and their comparisons about their joint venture in the construction industries. The paper focuses on the different technologies in different countries and how the people accepted them. The term joint venture is the most common term in the vocabulary of construction.

The increasing risks, complexities and magnitudes associated with the major projects of construction have brought the organization together with weaknesses and strength to form the joint venture and execute a project. The joint venture can be described as international where one of the party is located outside the country where the business is situated. Also, the joint venture can access competition, new markets, and economies of scale and government policy [1].

 The report gives the significance of the joint ventures between two different countries, also how people accepted the technologies related to the construction industry in the joint venture. It also talks about the comparison of the joint venture in different countries through a collection of data regarding the construction company.

In regard to the joint venture in different countries, the research questions that will be operational for the research paper are as follows

• How do you understand joint venture?
• What are some of the significance of the joint venture?
• What are the technologies that were put in place to develop construction industry?
• What are some of the pros and cons of adopting international joint venture?

The researchers sought to find the following objectives

• To explain joint venture in different countries in the construction industry
• To identify the significance of the joint venture in the growth of the international construction industry
• To collect data regarding joint venture in different nations from 10 years and its significance
• To compare the joint venture between different countries
• To find out how people accessed technologies transfer with the help of joint venture
• To find out the pros and cons of the adopting international joint venture 

The company of joint venture is the most common organization form and structure where parties wish to operate and establish businesses that are jointly owned. The joint venture has the different legal entity and also they have a specific time limit. The venture gives strength for achieving goals in the companies of construction. It also gives different opportunity in distinctiveness competencies combination and the complementary skills of the firms that are participating [2]. The options like the source of finance, reduction of risks, and access to market can make it a more attractive option to the joint venture. Nevertheless, problems could happen because of lack of trust between the partners and also inadequate of effective and strong leadership for success to happen, great attention must be paid to the management and human resource and facilitation of exercises of team building [3].

A joint venture is a corporation, partnership, enterprise that is made by two persons or more, and organizations and companies, one that is the entity of operation that wants to broaden the activities to get new profits. The participant’s distribution of equity share the ownership and by one party with the dominance that is absolute. A joint venture that operates is a corporation that firms form a separate entity that is separate to do activities that are productive. To carry out productive activities of the economy where every partner tale part in making the decision [4]. Every party contributes in form of technology and capital to experience in marketing, physical and personal assets.

The Significance of Joint Ventures in the Construction Industry

Joint venture that is integrated: its main features is that it can symbolize accurate partnership where the party shares losses and profits. The profits and losses are shared by members according to their in joint venture interest. The party combine the personnel and resources in an agreed-upon manner. This joint venture type is used in the projects which their size is enormous and splitting the task can be difficult. As a result, programming and planning can be hard and need central management of highly authoritative and highly structured [5]. They typically used the lengthy and strong relationship between parties and complex and nonlinear projects.

Its primary characteristic is that there is no sharing of losses and profits since it's not a partnership. Every member is taken for the scope that is responsible for losses and profits and specific to work associated with the work scope. Every member is responsible for the necessary assets to do its scope of work that is specified [6]. The advantage of this joint venture type nonintegrated is that for the joining to the joint venture by the contractor reach can supplement the other skills but its shortcoming is that some contractors are more hardworking than others, hence causing internal conflict. This joint venture type is applied where there can be the division of work to different sections, that can again be mandated out to separate partners who are accountable for the administrative and technical elements of the sections. It is typically used in a relationship that is limited between the desired parties and projects of linear with distinct scopes of work [6].

It presents the combination of the non-integrated and integrated joint ventures. every member takes the specified work scopes and responsible for the losses and profits associated with the scopes of work but the member agrees to work as a partner with respect to the necessary work portion that may in include the preliminary sharing and general necessary conditions for every scope of work of members and also actual performance of the project of work, it is used in both complex and larger projects [7].

Technology transfer: the aspect of technology is the overwhelming arguments in the joint venture favor. technologies that save time reduced the cost of projects result in economic benefits that are incalculable.in the industry of construction, new construction techniques, comprising the use of concrete that are ready mix use of raw materials that are new, such as cement of high strength and updating the projects team skills across the board from the Manson to the designer have all resulted to the qualities that are superior [8].

Different Types of Joint Ventures

Sharing of the risk of politics: this is a distinctive condition that a contractor to form a joint venture with organizations, lies in the international construction scope. Governmental risks like expropriation may be reduced if the interest of some native party is tied in the joint venture. A local significance equity in the participation in ventures may be good for import licenses local recruitment and commercial transactions [9].

sharing of commercial risks: joint ventures borrow themselves as vehicles for the commercial risk sharing, the consideration that is important in case of substantial project construction that may have a large commitment of finance over a fairly protracted period. These risks include the ones that are posed by vagaries of material shortage and labour, design and technology and changes in the regulation and legislation of the government [10].

Competition strategy: like the situation of project series that involve the form of specialized management expertise and engineering in the respect that there is half dozen organization that is accessible at a given project time. The perfect method may use the joint venture that will have the impacts of strengthening and creating the new territories’ condition by forcing competitors out of the market, ensure the price margin preservation and allocating work and market volume [11].

The implication of tax: a joint venture can also be practiced on the premises of the tax advantages.  The opinion on the status of the tax can be gotten from the consultant of tax who knows the laws of tax of the relevant jurisdiction before it is admitted and a consideration in the decision to proceed with the venture.

In Japan, there are four companies, Kobe steel limited, Kawasaki heavy industry limited, Hitachi metals limited and IHI corporations that jointly established a joint venture called the Japanese aeroforge. To manufacture large foraging for the use in the power and aircraft plants. The four companies that invested in japan aeroforge are making effort in the preparation for the production of aeroforge [12]. The strength of each company will give the support and contributes to its improvement the competitiveness of the aircraft industry of Japan.

Japan heavy industry manufacturers are bolstering their aircraft industry involvement and increasing their production and shares through joint international development. Japan aeroforge will produce more foraging made of high alloys and nickel and their demands are expected to increase. Also, the integrated japans production will be recycling more waste chips and other scraps gotten from the process of manufacture.it will improve the competitiveness cost and use of rare metals [13].

Technology Transfer

Japan forage press nickel, titanium, high alloys into the parts that are forged for the engine of aircraft and fuselages and also forged power plants parts. Hitachi Metals, another maker of materials and Kobe steel supply titanium, high alloy and nickel to japan aeroforge that will process the materials. After that, the company returns the processed parts to Kobe steel and Hitachi metals for machining, heat treatment and inspection.  Hitachi and Kobe then supply the forged materials to IHI, and KHI and other manufacturers [14].

While Hitachi metals have expertise in moulding and foraging technologies for high alloys and nickel, Kobe steel in Japan is integrated into titanium manufacture form melting to the final process, the two companies improved the manufacturing capabilities of the Japan aeroforge.  Also with the supply of more foraging that ids stable KHI and IHI utilized their technologies of fabrication and machining for the parts of the aircraft [15].

RPP in a project that was formed by different clients such as Toubro company, Larsen Company and IVRCL Infrastructure Company that are in the market of southern India and are engaged in the development of infrastructures like power plants, the supply of water irrigation and the civil construction. RPP in project limited is a developer of the brides and highway in India. The agreement was signed with the corporation of the Hunan group of engineering construction to develop the projects of infrastructure [16].

 The joint venture Hunan and RPP infra project limited work on the sector of the infrastructure in India and also giving opportunities and strength to RPP infra projects to have the ability to negotiate good terms of profits with parties. Hunan construction also has more assets of six billion RMB and the capacity of product that is over sixty billion RMB [17]. The figure below shows the RPP infra project that was developed due to a joint venture between different companies.

More investment in infrastructure is the major driver of growth of equipment of construction industry that attracts more nations around the world to come and invest in India. India has a big land of construction industry opportunities. Burma is the largest international fair trade in the Africa for the machines of building materials, machines for mining, vehicles for construction, and machines for construction.  All the players of the global in the equipment of the construction industries have their presence in India a joint venture [18]. These ventures have given the domestic companies with the advanced technology for the project management. The construction equipment in India has grown at a high percentage and high sales and the Burma Company is the biggest international fair trade in India dealing with the equipment for the construction. It has provided the opportunities of high and good technologies for the shops set up in India. Other countries have started to import the manufactured equipment in India like Algeria in Africa [19].

Sharing of Risks

The methods that were used in this research on the joint venture in construction industry between Japan and India are explained in this section. The researchers will find out on how people accepted different technologies and also hoe the joint venture led to development international construction industry. The procedure that will be used in this investigation depends on the education level, the age of the respondents and ranks in the company. The research should be done in a proper manner so that the research’s objectives are encountered and this will only be possible through using the methodology that is effective, appropriate data analysis and collection of data properly [20].

The investigation also emphases on how the implemented strategies can be developed to perfect the aim of improving the joint venture in the construction industry. Research methods have two different types that are quantitative and qualitative research. The qualitative research qualities borders on skills, researcher's capabilities and knowledge, the results may be personal due to the hypothesis that the results are typically coming from the judgment of the researchers and the interpretation that is personal. The comparisons between qualitative and quantitative research are shown in the table below [21]. 

Quantitative research	Qualitative research
The person doing research knows what is at stake in advance	The person doing research don’t have enough knowledge on what is at stake in advance
The one doing research uses instrument like interviews and questions	The one doing research uses the information of the data collection
Materials used are in form of statistics and numbers	Material used is in form of pictures, words and objects
The training features are planned meticulously before the collection of facts	As the training progress, the results arises

The interviews saw based purely on the question that is structured naturally and the observation. The aim is to reveal the emotions views and feeling of the participants in the joint venture in the construction industries between Japan and India and how the technologies affected the lives of people. Personal discussion and interviews give the opportunity for the interviewee and the interviewer to interact and have a direct contact. The researcher targets the group of the age of 18 to 65 years because it's the active age in the companies and community [22].

In the above literature review, the factors which have led to the success of the joint venture construction in Japan and India was identified. These factors were assembled into the survey of a questionnaire that was given to 1500 selected chief officers, of the registered Japan and India and 60 contractors that are foreign working in both countries that are Japan and India on construction joint venture. The aims of asking questions are to discover companies that have experience of the projects of the joint venture and their view and extent of the key issues associated with the joint venture.

The data were collected through interviews, phone, and email and also through social media. The interview sessions obtain certain answers that were substantial to questions. because the employees of these construction industries are busy at work the interviews session was performed during the day when there was a maximum time to avoid inconveniencing people, also the community, chiefs and government officials were timed when they are free.  Interviews lasted n between 40 minutes to 1 hour [22].

Competition Strategy

There were also book an appointment in the government offices so that they can be interviewed. Also, the ministry of construction and infrastructure was also targeted and were asked many questions regarding the joint venture in the industry of construction. The interviews sessions were happening in the festive occasion when happy and eager to answer questions. The gathered data will be used toward the objective of this research and also help researchers to come to conclusion [23]

The interviews were conducted in the following area in both Japan and India:

Ministry of construction of Japan and India: the construction officials, especially under the mining, irrigation, infrastructures etc., were targeted and since their information is more detailed they have the significant figures for the research. The government officials were asked the following questions:

• What are the significances of the joint venture in the international control industry?
• How do people accept the technology transfer in the construction industry through joint venture?
• Can u explain why the joint venture lowers the time of the construction through the invented technologies?
• How does a joint venture increase the construction quality and safety?
• What are some of the pros and cons of international venture?

Directors and CEOs of different construction industries in both Japan and India: the researcher visited various companies that deal with construction and tried to interview some of the directors and CEOs so that the conclusion can have detailed statistics [24].

• How is joint venture significant to both the company and local community?
• How can you Explain what is entailed in the joint venture?
• What are some of the risks associated with the joint venture in the construction industry?
• What are some of the technologies invented in the construction industry of the joint venture?
• What are some of the pros and cons of the joint venture in the international construction industry

Employees of the construction industry in both Japan and India: the employees who are working in the industries in Japan and India dealing with construction specifically the ones that are as a result of partnership or joint venture were asked  some questions so that the relevant and detailed statistics can be obtained to design a convincing conclusion [25].

• How do you understand joint venture?
• What are some of the benefits you are enjoying as an employee in this company now that it's a joint venture?
• What are the technologies you are using that were invented as a result of joint venture in the construction industries
• Do you accept the technology transfer? And how?
• What are some of the pros and cons of the joint venture that you are experiencing?
• What is the importance of the joint venture?
• What are some of the challenges or problems you are facing in the joint venture as employees?

The local community in Japan and India: the researcher also visited different people around the community and tried to ask them about their view about the joint ventures in construction. The following are some of the questions that they were asked [26]

• How do you understand joint venture?
• What are some of the significance of the joint venture in the construction industry?
• What are some of the problems of the joint venture in the construction industry?
• Do you accept technologies of the joint venture in the construction industry?

How these people will respond will determine the report structure. Their answers were used as the data that will help in making the final report. 

The respondents from the interrogating resident societies, ministries, directors and employees were tabularized and the remarks were prepared depending on the individual number of the suggestions that were similar. 

Significance of joint venture in construction industry in Japan and India	Number of respondents	% participants	comments
Provision of large capital funds	300	95%	Majority joint ventures are sources of capital and finance
Spread of risks	300	70%	Some of the construction industries moderately venture because of spreading risks
Provision of cooperation due to combination of effort	300	68%	Some of the industries venture to combine effort together to have a positive result
Quality improvement	300	70%	many industries jointly venture to have quality improvement because of practising different skills from different construction industries
Competition strategy	300	89%	Many industries merge to avoid completion because some become monopoly
Technology transfer	300	90%	Many industries jointly venture for technological transfer
Implication of tax	300	87%	Majority of the construction industries jointly venture to reduce the tax imposition

 The findings from the data confirm that different industries of construction jointly venture for different reasons. Main reasons why they jointly venture is because of financial risks, quality improvement, technology transfer, the spread of risks, for competition strategy implication of tax and provision of effort for cooperation [27].

The analysis of the content is known to be used broadly in the evaluating the data outcome gathered from the respondents of the sessions of the interview. The questionnaire can be divided into three parts

Tax Implications

Part one: information that is generally in the status joint venture company, business nature, involvement in the joint venture, the structure of the operations.

Part 2: a list of a possible success variables was selected as a result of the literature review. A scale of 1 to 5 was also used in the questionnaire. The respondents were required to state 1 to mean not important, 2 to mean less important, 3 to mean moderately important, 4 to mean important, and 5 to mean very important.

Part 3: for the companies with no experience of the joint venturing[28].

The respondents in the survey of the questionnaire were involved in many projects from commercial, industrial, residential, civil engineering, housing and public building.  The works of the joint venture were carried out for the last 10 years. The table one below shows the percentage of the status of their company that are involved in the internationals and domestic joint venture construction in both japan and India. The construction projects types undertaken by the companies was indicated to give information background on the nature of the businesses [29]. Every industry of construction in Japan had undertaken more than one project type. They are ranked from highest to the bottom

Significance of joint venturing in Japan	Standard deviation	Mean	Rank
Opportunities of new markets	1.038	4.25	1
Profits	1.001	4.15	2
Financial risk	1.886	3.87	3
Project sale increment	1.889	3.81	4
Risk reduction	1.025	3.77	5
Learning of the organization	1.075	3.73	6

The researcher was able to get answered for the questions for the nature of the businesses that the joint venture perform and 4 types of nature businesses were mentioned in japan

• Sub-contractors of specialists (20%)
• Developer of houses (32%)
• Contractors of civil engineering (70%)
• Contractors of buildings (81%)

The table two below shows the background information of the perception of the India and the foreign contractors toward the factor of potential success.

Significance of the joint venture in India	Standard deviation	Mean	Rank
Mutual understanding	0.700	4.78	1
Transfer of knowledge	0.787	4.63	2
Financial stability	0.795	4.58	3
Coordination and cooperation and combination of efforts	0.751	4.51	4
Get rid of competitions	0.768	4.49	5
Increase market or sales	0.965	3.98	6
Tax impose	1.051	3.78	7

It was noted that, in both Japan and India, many resources needed to meet the demands were not available in good quantities, there was lack of funding for their projects, also the industries of indigenous were not able to meet the demands this is why the technological transfer was very important. It is true that technologies are the highly differentiated range of techniques. These countries gain the technological transfer in form of training and education, exports, trades shows, and direct foreign investment [30]. The technology transfer element figured the Japan and India and hence that is why people accepted the technology transfer.

There are many factors that were cited as potential barriers to the technology transfer success. They are government, people, economy, business and culture. In India, the use of familiar technologies were preferred than developing the skills of production of the available labour source. The technology transfers in both India and Japan was influenced by social values, objectives that are different, level of technical development and cultural and language difference [31].

Japanese Aeroforge

In the projects of construction, changes are likely to occur anytime and they are very common. In both japan and India, the joint venture has led to sharing of knowledge and invention of different kinds of technologies that have led to their success. people accepted these technologies because they benefited through making work easier, reducing human power and cost,  in Japan these technologies helped a lot because the land these is normally loose and too many constructions without proper knowledge can lead to land degradation other more problems hence, people accepted technologies well in both Japan and India [31].

Conclusion

This research focuses on the joint venture in the construction industry in the world and its significance to the international industries of construction. It also covers how data were collected in the different country and their comparisons about their joint venture in the construction industries. The paper also focuses on the different technologies in different countries and how they people accepted them.  The term joint venture is the most common term in the vocabulary of construction.  The increasing risks, complexities and magnitudes associated with the major projects of construction have brought the organization together with weaknesses and strength to form the joint venture and execute a project. 

A joint venture is a corporation, partnership, enterprise that is formed by two persons or more, organizations and companies, at least one that is the entity of operation that wants to broaden the activities to get new profits. The joint venture Hunan and RPP infra project limited work on the sector of the infrastructure in India and also giving opportunities and strength to RPP infra projects to have the ability to negotiate good terms of profits with parties. In japan, there are four companies, Kobe steel limited, Kawasaki heavy industry limited, Hitachi metals limited and IHI corporations that jointly established a joint venture called the Japanese aeroforge.  

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