Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

Factors Affecting the Level of Trust and Commitment in Supply Chain Relationships

Factors Affecting the Level of Trust and Commitment in Supply Chain Relationships SUMMARY Trust is a critical factor fostering commitment among supply chain partners. The presence of trust improves measurably the chance of successful supply chain performance. A lack of trust among supply chain partners often results in inefficient and ineffective performance as the transaction costs (verification, inspections and certifications of their trading partners) mount. Although the literature often mentions a relationship between trust and commitment, there is a lack of empirical testing of such relationship in the supply context. This study attempts to fill the gap between the theoretical argument and empirical testing. Results using a comprehensive survey of supply chain practitioners indicate that a firm's trust in its supply chain partner is highly associated with both sides' specific asset investments (positively) and behavioral uncertainty (negatively). It is also found that information sharing reduces the level of behavioral uncertainty, which, in turn, improves the level of trust. A partner's reputation in the market has a strong positive impact on the trust‐building process, whereas a partner's perceived conflict creates a strong negative impact on trust. Finally, the level of commitment is strongly related to the level of trust. Policy implications are discussed. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Supply Chain Management Wiley

Factors Affecting the Level of Trust and Commitment in Supply Chain Relationships

Loading next page...
 
/lp/wiley/factors-affecting-the-level-of-trust-and-commitment-in-supply-chain-oweWvwr0dP

References (72)

Publisher
Wiley
Copyright
Copyright © 2004 Wiley Subscription Services, Inc., A Wiley Company
ISSN
1523-2409
eISSN
1745-493X
DOI
10.1111/j.1745-493X.2004.tb00165.x
Publisher site
See Article on Publisher Site

Abstract

SUMMARY Trust is a critical factor fostering commitment among supply chain partners. The presence of trust improves measurably the chance of successful supply chain performance. A lack of trust among supply chain partners often results in inefficient and ineffective performance as the transaction costs (verification, inspections and certifications of their trading partners) mount. Although the literature often mentions a relationship between trust and commitment, there is a lack of empirical testing of such relationship in the supply context. This study attempts to fill the gap between the theoretical argument and empirical testing. Results using a comprehensive survey of supply chain practitioners indicate that a firm's trust in its supply chain partner is highly associated with both sides' specific asset investments (positively) and behavioral uncertainty (negatively). It is also found that information sharing reduces the level of behavioral uncertainty, which, in turn, improves the level of trust. A partner's reputation in the market has a strong positive impact on the trust‐building process, whereas a partner's perceived conflict creates a strong negative impact on trust. Finally, the level of commitment is strongly related to the level of trust. Policy implications are discussed.

Journal

Journal of Supply Chain ManagementWiley

Published: Mar 1, 2004

There are no references for this article.