Negotiating and Enacting Contracts for Business Networks Peter Rittgen School of Business and Informatics University College of Borås - 501 90 Borås, Sweden Phone: +46-33-435-5930 - Fax: +46-33-435-4007
[email protected] Abstract together to provide a common portfolio of complemen- tary products and services. But by externalizing the Flexibility is a major issue in business today and one problem of flexibility we have not yet solved it. Now we answer to that is to organize work in networks of com- have to ask the question of how the coordination of such panies rather than within a single business. Cooperation a network can be achieved in a flexible way. between organizations is more easily established and adapted than reorganization of internal company In a business network the coordination effort is much structures. But how do we manage flexibility in such a higher than in a conventional supply chain where a network without sacrificing the minimum stability that is company can focus on the relation to a few immediate required for economic success? We suggest a method major suppliers. In a network coordination is also re- for coordinating interaction in a business network that quired among suppliers, i.e., we move from a tree provides three levels of flexibility: local ad-hoc change, structure to a graph topology which implies a new balance global negotiated change and planned change. This between market and hierarchical coordination. The method is based on the negotiation and enactment of general problem has been studied in theory, most notably process-based interorganizational contracts.