Managing Conflict in Strategic Business Networks - An Organizational Justice Perspective

Strategic networks as a form of long-term, interfirm cooperation constitute a source of competitive advantage that is receiving increasing attention from academics and practitioners alike. Increases in efficiency and flexibility, entry to new markets, risksharing as well as know-how transfer are benefits that can be realized via strategic networks. However, these advantages do not materialize easily, as companies painfully discover. In reality, interfirm cooperation often leads to unsatisfactory results. This situation poses a dilemma for organizations: on one hand, engaging in network activities can lead to increased organizational performance. On the other hand, chances are high for cooperative efforts to end in failure and generate considerable cost. Searching for the causes of network failure, conflict between partner companies comes into view. This thesis analyzes conditions for the emergence, development and resolution of conflict within strategic networks from an organizational justice perspective. It is demonstrated that the consideration of justice issues enhances the quality of both interfirm and interpersonal relations, and reduces dysfunctional conflict. In addition, the justice perspective offers new insight into the usefulness of existing conflict resolution methods in a cooperative context.