Paper info

The Role of Contractual Design in the Formation and Development of Business Service Relationships

Kostas Selviaridis and Pauliina Ulkuniemi

The paper was published at the 25th IMP-conference in Marseille, France in 2009.

 This paper explores the role(s) of contracting in the formation and development of service exchange relationships. Based on review and synthesis of industrial networks and contracting theory, a preliminary conceptual framework is developed to argue that contracting can be conceived as a means of stabilising and changing/adapting service exchange relationships, particularly in terms of their associated activity and resource structures. A single, exploratory case study in the construction consultancy industry context is conducted to test the conceptual frame. Preliminary findings appear to provide some support for the main theoretical conjecture  contracting has a stabilising function since it facilitates a common understanding of service activity and resource requirements at the early stages of exchange relationship formation and it explicates and codifies the exchange object. At the same time, contracting fulfils a changing function by allowing for certain activity and resource adaptations during the exchange.