Performance criteria and drivers in cooperative ventures

Chapter 23 examines performance in cooperative ventures, a complex issue. The question of performance must be addressed from at least three perspectives; those of the two or more parents and the cooperative entity. Because cooperative ventures are either contractual arrangements between various operational units in the parents or are independent organizations with their equity closely held by the parents, classic measures of firm performance often are not reported publicly and may not even be collected systematically by the parents. The performance of an alliance as a functioning entity may not equate to its performance for its partner or parent companies. For example, it may be subject to a variety of payments such as franchising fees and royalties that benefit one or the other parent, hurt the financial performance of the alliance, but benefit the system as a whole.