Business networks and conflict management

The aim of this thesis is to provide an in-depth study of conflict management in business networks. Business networks threaten to become one of the core organising principles of 21st century business life; however, there is still a lack of knowledge about how business networks work in practice. In particular, relatively little is known about the governance systems used to allow networks to operate optimally. On this issue, scholars have mostly focussed on the role of relational and legal contracts in building stable and smooth-functioning business networks. This literature has provided important insights into the formal and informal processes used by organisations to maximise resources and reduce transactions costs in networks. However, an important matter that has received only marginal attention in the literature is how conflict is addressed in business collaborations between firms. This is considered a weakness for, just as stand-alone firms need processes and procedures to solve conflict, so too will business networks. The purpose of this thesis is to redress this shortcoming. Using the existing theory on conflict management, a four pillar framework, outlining the role of procedures, structure and roles, behaviour and skills, and values and attitudes, has been developed to help analyse the function of conflict management in business networks. The study consists of three purposively selected case studies of different forms of business networks: a Private Public Partnership, a construction project and a supply chain situation. On analysing and interpreting the cases, six key findings are outlined in relation to the dynamics of conflict management in business networks. It is also found that conflict management is a proto-institution in the field of business networks.