Essay on Blue Ridge Spain

2335 WordsDec 12, 200910 Pages
Introduction Blue Ridge Spain is a joint venture established between an American fast food chain and a Spanish agricultural firm, Terralumen. Terralumen contributed the most to Delta’s success in foreign markets. After 15 years of a successful joint venture, Costas was shocked to find out that new owner, Delta, wanted to end the partnership despite of the joint venture’s profitability. Issues and Analysis Cultural Issues Cultural differences, as related to doing business, come into play here. Significant cross cultural conflicts between parents of different nationalities paved the way for the dissolution of the joint venture between Delta and Terralumen. In a Board of Director’s meeting, the American-Spanish joint venture…show more content…
They also must consider if it is possible to continue without Delta, given that the Blue Ridge name belongs to Delta. Each of the main players also has choices to make. Player Perspectives For Francisco Alvarez, he has always maintained a personal stake in the relationship. He helped cultivate the joint venture from its inception and must now choose the best direction for his company. Terralumen’s main industry is agriculture, and this venture was a means of experimenting by taking the business in a new direction. Increased, rapid restaurant expansion would move away from the key business and is perceived as too risky for a high uncertainty avoidance culture like Spain’s. Terralumen is also family-owned, so it does not have to deal with the pressures of short term gains that a public company like Delta foods must. Alvarez needs to try to fix the relationship, but also plan a separation strategy. For Mikael Södergran, he was hired to apply Delta’s strategy and expand the business. Delta’s philosophy has always been against joint ventures, and he was working on dissolving this venture by any means necessary. Going forward, he must decide the best approach to ending this venture. He must also be aware of how his actions impact future joint ventures in Spain or elsewhere. Actions such as not paying their share on a loan in order to default the loan will not be viewed kindly by other companies. He not only lacks

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