Danone’s wrangle with Wahaha.
The problem arose in 2005 when Danone learned that beginning from the year 2000, the Wahaha Group had established other non-joint subsidiaries with the joint venture trademark, “Wahaha.” Danone also learned that the non-joint subsidiaries also sold similar products to those of the JV. Danone Group objected and sought to purchase 51% of the subsidiaries from Wahaha Group, but Wahaha Group declined the offer. Danone felt that Wahaha Group had violated its joint venture agreement of not using the “Wahaha” trademark on any other independent entity.
Wahaha Group: That the Wahaha Group was required only to play the role of management and needed to consult with Danone in every decision making process, including the use of the same sales staff in promoting sales in the non-joint ventures.
Danone: That Wahaha had maintained its trademark ownership but was to be shared in the joint venture for the common good of the two companies.
Effect of the national culture
The local government in China wanted to create more job opportunities for its people. Additionally, it needed to generate more tax revenues th. Therefore, these two objectives pushed the government into supporting companies like the Wahaha group into establishing more subsidiaries. Additionally, the government owned the trademark and therefore did not transfer it to the Danone.
Ways of handling conflict.
Collaboration builds the assertiveness and cooperation of every team member (Habas, 2019). When there is collaboration in order to find a solution, each member states his needs and a decision is arrived at after putting everyone’s needs into consideration (Habas, 2019).
Embracing the conflict.
Embracing the conflict prevents tension build up (Kappel, 2017). Additionally, handling the conflict immediately it happens helps prevent embedment of bad feelings and problems into the daily routine (Kappel, 2017).
Listening carefully helps in understanding the concern of the other party. Clarification of points made by the other party is important where needed (Kappel, 2017).
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