Abstract
Despite an abundance of research on inter-organizational trust, researchers are only beginning to understand the process of trust deterioration as an inter-organizational phenomenon. This paper presents a case study examining the deteriorating relationship between two international high-tech firms. We surveyed respondents from the supplier firm to identify major elements that reduced the supplier's trust in its customer, using the dimensions of trust identified by Mayer et al. (1995). While violations of ability, integrity, and benevolence all contributed to trust reduction, early violations of trustee benevolence contributed importantly to trust deterioration. Over time, the relationship became "sensitive," and respondents reported many incidents of trust violation. Managers reported primarily integrity- and benevolence-related incidents, while no pattern emerged among operations personnel. We examine the results in light of Hosmer's (1995) ethically-based trust principles. The supplier and customer would likely differ in their opinion of whether the customer was acting "ethically." This suggests that scholars need to examine how many principles can be violated before trust is eliminated, and whether any of the principles are particularly salient in business relationships.
Similar content being viewed by others
References
Bell, Geoffrey G. and Marc Anderson: 2000, Trust, Positional Security, and Information Transfer in Four Network Ideal-Types: Exploring the Linkages Between Forms of Social Capital (Academy of Management. Toronto, Ontario, Canada).
Brenkert, George G.: 1998, ‘Trust, Morality and International Business’, Business Ethics Quarterly 8, 293–317.
Butler, J. K.: 1991, ‘Toward Understanding and Measuring Conditions of Trust: Evolution of a Conditions of Trust Inventory’, Journal of Management 17, 643–663.
Butler, J. K. and R. S. Cantrell: 1984, ‘A Behavioral Decision Theory Approach to Modeling Dyadic Trust in Superiors and Subordinates’, Psychological Reports 55, 19–28.
Cook, J. and T. Wall: 1980, ‘New Work Attitude Measures of Trust, Organizational Commitment, and Personal Need Nonfulfillment’, Journal of Occupational Psychology 53, 39–52.
Dillman, Don A.: 1978, Mail and Telephone Surveys: The Total Design Method ( John Wiley & Sons, New York).
Duran, Jose Luis and Fernando Sanchez: 1999, ‘The Relationships between the Companies and Their Suppliers’, Journal of Business Ethics 22, 273–280.
Flores, Fernando and Robert C. Solomon: 1998, ‘Creating Trust’, Business Ethics Quarterly 8, 205–232.
Fukuyama, Francis: 1995, Trust: The Social Virtues and the Creation of Prosperity.
Giffin, K.: 1967, ‘The Contribution of Studies of Source Credibility to a Theory of Interpersonal Trust in the Communication Department’, Psychological Bulletin 68, 104–120.
Glaser, Barney G. and Ansel M. Strauss: 1967, The Discovery of Grounded Theory: Strategies for Qualitative Research.
Granovetter, Mark: 1985, ‘Economic Action and Social Structure: The Problem of Embeddedness’, American Journal of Sociology 91, 481–510.
Hosmer, LaRue Tone: 1995, ‘Trust: The Connecting Link between Organizational Theory and Philosophical Ethics’, Academy of Management Review 20, 379–403.
Hovland, C. I., I. L. Janis and H. H. Kelley: 1953, Communication and Persuasion (Yale University Press, New Haven).
Jones, Thomas M. and Norman E. Bowie: 1998, ‘Moral Hazards on the Road to the "Virtual" Corporation’, Business Ethics Quarterly 8, 273–292.
Kanter, Rosabeth Moss: 1989, ‘Becoming PALs: Pooling, Allying, and Linking Across Companies’, Academy of Management Executive 3, 183–193.
Lewicki, Roy J. and Barbara Benedict Bunker: 1995, ‘Trust in Relationships: A Model of Development and Decline’, in B. B. Bunker and J. Z. Rubin (eds.), Conflict, Cooperation, and Justice ( Jossey-Bass Publishers, San Francisco), pp. 133–173.
Lieberman, J. K.: 1981, The Litigious Society (Basic Books, New York).
Mayer, Roger C., James H. Davis and F. David Schoorman: 1995, ‘An Integrative Model of Organizational Trust’, Academy of Management Review 20, 709–734.
McEvily, Bill, Akbar Zaheer and Vincenzo Perrone: 2000, ‘Trust Asymmetries in Interorganizational Dyads: Exploring Causes and Consequences’, Working paper.
McFall, L.: 1987, ‘Integrity’, Ethics 98, 5–20.
McKnight, D. Harrison, Larry L. Cummings and Norman L. Chervany: 1998, ‘Initial Trust Formation in New Organizational Relationships’, Academy of Management Review 23, 473–490.
Meyerson, Debra, Karl E. Weick and Roderick M. Kramer: 1996, ‘Swift Trust and Temporary Groups’, in R. M. Kramer, and T. R. Tyler (eds.), Trust in Organizations: Frontiers of Theory and Research (SAGE Publications, Inc., Thousand Oaks, CA), pp. 166–195.
Mudambi, Ram and Susan Helper: 1998, ‘The Close but Adversarial Model of Supplier Relations in the U.S. Auto Industry’, Strategic Management Journal 19, 775–792.
Ring, Peter Smith and Andrew Van de Ven: 1992, ‘Structuring Cooperative Relationships Between Organizations’, Strategic Management Journal 13, 483–498.
Ring, Peter Smith and Andrew H. Van de Ven: 1994, ‘Developmental Processes of Cooperative Interorganizational Relationships’, Academy of Management Review 19, 90.
Rousseau, Sim Sitkin, Ronald Burt and Camerer: 1998, ‘Not so Different after All: A cross-discipline View of Trust’, Academy of Management Review 23, 393–404.
Sitkin, Sim B. and Nancy L. Roth: 1993, ‘Explaining the Limited Effectiveness of Legalistic "Remedies" for Trust/Distrust’, Organization Science 4, 367–392.
Strauss, Karyn: 1999, ‘Trust is the Key to Buyersupplier Relationships’, Nation's Restaurant News 33, 94, 116.
Tversky, Amos and Daniel Kahneman: 1982, ‘Availability: A Heuristic for Judging Frequency and Probability’, in D. Kahneman, P. Slovic and A. Tversky (eds.), Judgment under Uncertainty: Heuristics and Biases (Cambridge University Press, Cambridge, U.K.), pp. 163–178.
Yin, Robert K.: 1994, Case Study Research: Design and Methods, 2nd ed. (SAGE Publications, Thousand Oaks).
Zaheer, Akbar, Bill McEvily and Vincenzo Perrone: 1998, ‘The Strategic Value of Buyer-supplier Relationships’, International Journal of Purchasing and Materials Management 34, 20–26.
Zand, D. E.: 1972, ‘Trust and Managerial Problem Solving’, Administrative Science Quarterly 17, 229–239.
Zucker, Lynne G.: 1986, ‘Production of Trust: Institutional Sources of Economic Structure, 1840–1920’, in L. L. Cummings and B. Staw (eds.), Research in Organizational Behavior ( JAI Press), pp. 53–111.
Author information
Authors and Affiliations
Rights and permissions
About this article
Cite this article
Bell, G.G., Oppenheimer, R.J. & Bastien, A. Trust Deterioration in an International Buyer-Supplier Relationship. Journal of Business Ethics 36, 65–78 (2002). https://doi.org/10.1023/A:1014239812469
Issue Date:
DOI: https://doi.org/10.1023/A:1014239812469