(The sole hold-out: 3M, which has a relatively small joint venture portfolio.) Additionally, the median company restructured 32% of its joint venture portfolio during the period, with ConocoPhillips leading the pack and restructuring more than three-quarters of its joint ventures. The data revealed that 37% of joint ventures in our dataset were restructured at least once in the last four years, and that 59 of the 60 companies in our dataset restructured at least one joint venture during that period. Six companies - Tesla, Bosch, Total, BASF, Rio Tinto, and Lockheed Martin - emerged as the leaders within the automotive, industrial, aerospace and defense, chemicals, oil and gas, and mining sectors. Companies that were more active in restructuring existing and forming new joint ventures and partnerships were more likely than industry peers to meet or exceed their industry’s three-year average ROC. We found a strong correlation between overall partnership portfolio activity and company return on capital (ROC). Is shaping and reshaping joint venture and partnership portfolios a sign of corporate weakness, capability gaps, and strategic missteps – or a source of competitive advantage? To find out, we conducted an analysis of 60 leading companies across six sectors and more than 2,200 of their joint ventures and partnerships to understand how their portfolios have changed in the last four years. AES and Siemens recently brought in a third partner, the Qatar Investment Authority, to help fund growth of Fluence, their large-scale energy storage joint venture. health care market, due to strategic differences. For example, Amazon, JPMorgan Chase, and Berkshire Hathaway recently unwound Haven, a high-profile joint venture launched three years ago to lower costs and improve outcomes in the U.S. Many are in need of restructuring to meet changing market conditions, shifting owner company strategies and financial positions, and other forces. Partnership can’t remain static, however. And amid anti-globalization sentiments and a rise in restrictive regulatory regimes, joint ventures with local partners act as strategic tools to expand or solidify a company’s international foothold.

Partnerships have emerged as a key vehicle to compete in new technology-driven domains, including renewable energy, circular economy, digital health, and mobility. Companies like Amazon, GlaxoSmithKline, Lockheed Martin, Rio Tinto, Shell, Siemens, and Volkswagen hold large installed bases of joint ventures and partnerships and, in many cases, depend on such partnerships for 25% or more of revenue or net income.

They do so by innovating, making strategic shifts, rewiring existing operations, reallocating resources, entering new business lines, and restructuring existing ones.įor most companies, joint ventures and other partnerships are a critical part of the equation.

Successful companies actively manage their businesses through periods of economic growth, downturn, and recovery.

Benefits of a joint venture