Series of Dissertation
02 / 2013

Anna Swärd:
Trust processes in fixed-duration alliances: A multi-level, multi-dimensional, and temporal view on trust

ISSN: 1502-2099
ISBN: 978 82 8247 076 6
No. of pages: 165
Price: Nok 200

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Abstract
The thesis is comprised of four papers that all contribute to the understanding of the trust process. Each paper is summarized below.

The first paper found that, even in fixed-duration alliances, detailed and well known contracts, industry norms for appropriate behaviour and positive initial encounters can facilitate the development of trust. This trust can take two forms. One is the traditional personal trust resulting in learning and high performance. This trust replaces other forms of governance and therefore entails risks of opportunism. The other form of trust is inter-organizational, founded on the contract and industrial norms and initiated from favourable initial encounters. This form of trust allows smoother and faster processes throughout the cooperation exposing the firms to relatively low risks. We call it contractual trust. As the contract proceeds towards termination, the benefits of opportunism may be too tempting, resulting in distrust.

The second paper asks if it matters who trusts who in an alliance. And is it important how and when trust emerges between groups or individuals? This study gives insight into how different forms of trust coexist at the operational and managerial levels initiating different trust paths. Early positive encounters on the managerial level create a safe context for trust development on the operational level, whereas over time day-to-day activities on the operational level generate opportunities for mutual exchanges and encounters where trust is tested. If experiences are positive, developments on the operational level becomes crucial for the trust building process on the managerial level. Individual trust may arise due to frequent and favorable individual interactions and it is more likely found within a context of collective trust. Individual trust reinforces collective trust, but may also impact it negatively if individual trust turns into distrust. Individual level trust is not easily transferred to collective trust, but is more sustainable when surrounded by it.

The third paper explores how trust at one level in an alliance influences how trust evolves on other levels over time. The focus is on cross-level influences at three levels: operational group level, managerial group level, and firm level. Previous studies have shown that there are cross-level influences, however, there is limited understanding of processes of development during the course of an alliance. We present three types of influence; affiliations, spillovers and communication, and show that their significance differ in different stages of the alliance relationship. We argue that alliance trust initially can be based on firm level trust while group and individual level trust becomes more important over time.

The fourth paper contributes to the understanding of how different actions and different forms of reciprocity interact with trust in alliance relationships. In a process view of trust, reciprocal actions, particularly those that demonstrate a “leap of faith,” stimulate trust development. Based on an in-depth case study, a process model of actions, reciprocations from these actions, and the subsequent impact on the development of trust was developed. The findings of the study show that trust evolves from reciprocity of leap-of-faith actions through two interrelated processes, referred to as “signaling” and “testing”. The signaling process consists of a series of small leaps from both parties. When small leaps are immediately reciprocated, trust gradually evolves. Once this process has been established, larger leaps of faith with riskier actions are observed. Positive outcomes from testing lead to a deeper form of trust. It is explored under which conditions signaling and testing occur, and the implications of these findings for the understanding of how trust evolves within a social exchange process are discussed. Findings from this study challenge the view of trust as a stable indicator in alliance processes, instead portraying trust as context-specific and shifting.

In sum, the main aim of this thesis has been to understand trust processes in fixed-duration alliances. I have argued that to gain an understanding of how people come to trust each other and how trust develops over time, it is necessary to have insights into how people interact, how trust at different levels influence each other, and how trust may take different forms.