Rules of the Game; How to Capture Value in Business

This volume provides a practical guide for managers about the rules of the game of transactional exchange. Starting from a theoretical position that takes the exchange transaction as the basic unit of analysis for all economic, business and social science thinking, this volume outlines the internal and external moves that managers need to consider when making decisions about how to appropriate value for themselves and for their organisation from business relationships. The book analyses the nature of transactional exchange and then focuses on the rules of the game for those involved in internal transactions that occur within organisations between managers at the same, as well as at different, levels of seniority. The book also analyses the external transactions that managers are involved with. These transactions include horizontal relationships between joint venture and strategic alliance partners, as well as those between buyers and suppliers. Each of these types of relationship are analysed to show the moves by which exchange partners can maximise value appropriation opportunities for themselves and /or their organisation. The volume also discusses the problem of ethical behaviour in exchange relationships. Particular attention is devoted to the issue of opportunism when information asymmetry provides scope for one party to leverage more value from exchange than would be possible if a more transparent and honest approach was adopted to transactional outcomes by both parties. The problem of disentangling personal and organisational interests in business relationships internally and externally is considered. The book concludes with the view that, while organisations may attempt to set ethical standards of corporate behaviour, ethics and morality are fundamentally personal phenomena.