The “agent effect” on business divorce

Abstract

PurposeThe purpose of the paper is to explore the introduction of agents, such as consultants and lawyers, when the continuation of a business relationship is threatened by conflict.Design/methodology/approachBased on findings in a distorted business relationship in the oil industry, describes an “agent effect” on managerial decisions.FindingsThe “agent effect” reduces uncertainty in the decision process by adding information, but also increases the uncertainty. This implies that their advice in fact may increase managerial uncertainty to a level of which the relationship may end up in a business divorce. The study is explorative and based on a single case study design where written communication between the battling parties, public media and court writs are investigated. Primary and secondary data sources are combined.Research limitations/implicationsAlthough the paper's strength lies in it being an in‐depth analysis of a single case, this approach is also a limitation when claiming new knowledge.Practical implicationsFuture research should test the existence of “agent effect”, based on a quantitative, cross‐sectional survey design to secure a more general validity. The paper suggests a general carefulness when bringing in external agents into an inter‐organizational dispute, unless the agents are representing both parties as mediators.Originality/valueThe challenge of managing conflict and divorce in a business‐to‐business context has been well studied before, but the role of external agents has not, until now, been explored. This study fills this gap.