Authors: Peter Dahlin; Peter Thilenius; Virpi Havila
During the late 90-ties a large number of suppliers of IT-companies were established. These IT-companies were primary suppliers of various services and products many ordinary companies, in a short time perspective, lacked both the competence and the manpower to perform. The establishment of IT-companies meant that many new enterprises entered already existing business network of long-lasting business relationships. The entering IT-companies rapidly gained strong positions due to their customers? need for IT-adaptation of their businesses.The positive expectation about IT and its role in companies? development was though soon followed by a more negative trend. The demand for IT-services, which had created the opportunity establishing new companies, altered into a period of stagnation leading to changes in the industry. These changes meant e.g. the mergers between, or acquisitions of IT-suppliers by others to sustain profitability. Some were driven into bankruptcy or restructuring in lack of assignments. For the companies working with the IT-companies this meant experiencing two waves of change. The first wave was when new business relationships with the IT-companies were initiated. This was followed a second wave of change where many of the business relationships dissolved due to liquidation or other changes of the IT-companies? status. The last years? events related to IT-companies and their customer shows that radical changes in a business network, affecting many companies, can happen in a short span of time.Changes are in many studies explained as an incremental process occuring over time in the existing relationships through the companies? interaction and various adaptations. Studies concerning radical changes within existing network structures are though more rare. Business networks can undergo radical changes as the result of, in our case, IT-companies going bankrupt, mergers between them or acquisitions. All these changes affect the strength of the existing business relationships in the IT-related business network, either strengthening them or in many cases starting a dissolution process leading to termination.There are a limited number of studies focusing on how the ending of companies? business relationships with IT-companies supplying IT-related services and products affect the involved companies and the business network surrounding them. TheWork in progress ? Please do no quote 2purpose of this paper is therefore to elaborate further on how to study this type of radical changes in business
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Publish Year: 2003
Conference: Lugano, Switzerland (2003)