Paper info

Relationships after Bankruptcy: Emerging or Reactivated?

Olof Wadell and Susanne Åberg

The paper was published at the 32nd IMP-conference in Poznan, Poland in 2016.

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Business relationships are often developed over a long time period and long-lasting in nature. Even though business relationships from one point of view can be considered stable, they are at the same time dynamic and constantly changing. During the last decade, several studies on relationship disengagement have been conducted. One of the findings is that even though trading has stopped, different types of bonds can still exist between the former business parties. In other terms, the process of disengagement has not yet come to an end. But what happens to relationships after an acquisition of a bankruptcy estate? Are relationships reactivated, like a Phoenix rising from the ashes, or are they to be considered as new, i.e. emerging, relationships without any previous history? Theoretically, the paper draws on IMP literature concerning relationship dynamics, such as relationship disengagement and relationship reactivation: but it also includes literature on emerging relationships. According to Mandják et al. (2015), what all new business relationships have in common is that they, in the starting situation, “do not yet know each other” and, correspondingly, there is no interaction between them. The companies just co-exist in time and space. However, as will be shown, there are situations were old interactions exist that from the start will affect the new relationship. The purpose of the paper is, consequently, to demonstrate that new business relationships can be marked from birth by old business interactions, i.e. that a new business relationship can inherit its point of departure from previous interactions. The study conducted is a single case study where a focal business relationship, consisting of a customer-supplier relationship in the automotive industry was investigated in relation to the acquisition of the bankruptcy estate. The preliminary findings indicate that history matters and that a new relationship can be marked by previous business interactions. Finally, this paper shows that the emergence of new relationship is more intricate than previously described, and that managers need to be aware of the restraints that old interactions can put on new business.