Article at a glance:

China partners

Foreign investors used to team up with Chinese companies just to gain a toehold in the market; it didn't matter too much which company as long as it knew the territory. But as China opens more of its industries to foreign investment, competition for good alliances is heating up, and the profitability of joint ventures depends increasingly on the caliber of the Chinese partner. We looked at 31 companies, with 400 alliances in China, to learn what separates top performers from the rest.

The take-away

Alliances with Chinese companies can be just as rewarding as wholly owned ventures if the alliances are carefully chosen, closely monitored, and—when circumstances demand— restructured without delay.