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Case Study

Hyoptical Company Limited

By Allen J. Morrison

12 pages

December 2007

Reference: IMD-3-1938

The case focuses on the American side of a 50-50 joint venture (JV) with a Korean technology company. The American company (ORC) is providing the JV with optical switches; the Korean company (Hyun Bit) is providing optical buffers. The JV is then integrating these devices and has thus far made great progress selling to customers like Cisco and Samsung. However, the JV is also losing money with no end in site. To complicate matters, the Korean’s are now eager to expand the JV’s production to meet demand in Korea. Bill Steele, VP of Operations for ORC, has been asked by the Chairman and ORC’s majority shareholder for recommendations on how to proceed.

Learning Objective

The case provides a great foundation for discussing strategic intent in joint venture partner relations. Both partners have very different objectives for the JV, which will eventually cause a collapse of the relationship. The case allows the instructor to discuss how to “read” the strategic intent of partners and act to minimize exposure to risk in the relationship. The case also serves as a vehicle for discussing cross-cultural management, organizational learning, and how to do business with Asian conglomerates. Finally, the case allows for a rich discussion of the challenges of maintaining ownership and control of fast-growing start-ups. The case features several venture capital firms and allows a full discussion of their interests in and approaches to start-ups.

Keywords

Global Business, Cross-cultural Management, Organizational Learning

Settings

Summer 2007

Type

Generalized Experience

Available Languages

English

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Organization Nippon Telegraph and Telephone

Industry Services, Telecommunications;Information Technology

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