The More Trust the Better! Really?
We certainly all agree: Trust between supply chain partners has a lot of benefits. However, in their interesting study of trust in the buyer–supplier relationship, Villena and her co-authors argue that there is a “duality of trust”: Trust has benefits but it can also become dysfunctional if it is excessive. The results of their study show “that trust follows an inverted-U shape with performance”, i.e., at a certain point the negative effects offset the benefits of trust and performance declines. The authors also show that “[t]rust’s negative effects are more severe for those buyers that are highly dependent and operate in stable markets”. But why could trust ever be harmful? Well, trust might create “blind faith” into a supplier when the buyer is too optimistic. Another explanation could be that buyers might avoid tensions with suppliers that they otherwise trust – even if they observe declining performance. Trust can also increase reliance and unnecessary obligations that constrain the buyer.
Villena, V.H., Choi, T.Y., & Revilla, E. (2016). Revisiting Interorganizational Trust: Is More Always Better or Could More Be Worse? Journal of Management. https://doi.org/10.1177/0149206316680031
3 responses to “The More Trust the Better! Really?”
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- 2018-01-30 -
If trust leads to shifting responsibilities that you should be taking to partners then I can see how this could be harmful in the long run…should be an interesting read to kickstart the new year.
Very interesting and quite subjective…! collaborations are based on mutual benefit of partners/hips, where such (benefit) no longer exists or is lacking, trust diminishes as well. once one of the partners in a partnership AVOIDS to do or say something, that alone, brings in a negative vibe into the partnership. I look forward to reading the complete research paper.