Managing complexity through business relationships: the case of the Swedish electricity market

Lennart Haglund, Tommy Kovala and Cecilia Lindh

International Journal of Management and Decision Making, 2019, vol. 18, issue 2, 209-227

Abstract: In the industrial market, electricity is an essential resource for production, as a stop in its flow may cause expensive production loss and thus tremendous cost. This strong resource dependence and the inevitable competition that comes with deregulation of the market, makes the electricity business complex and relationships of long-term orientation to form. To study such relationships, a mixed method is applied to provide contextual knowledge: by four interviews and a descriptive model and a structural model with three hypotheses developed (n = 122). Managers of products that may seem simple and traded in a market where low cost prevails should think again - stable relationships are a necessity for rational decisions also in this case, particularly since interdependence is influential.

Keywords: business relationship; buyer-seller relationships; commitment; complexity; deregulation; electricity intensive industry; electricity retailers; interdependence; mixed method; pricing; production resource management; services; structural equation modelling; Swedish electricity market; trust. (search for similar items in EconPapers)
Date: 2019
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