Who can you trust? Identifying signals of trust in supply chain relationships

Trust between organizations is a necessary component for supply chains to function effectively. The nature of trust allows a party within a relationship to put themselves in a vulnerable state where they expect positive... [ view full abstract ]

Trust between organizations is a necessary component for supply chains to function effectively. The nature of trust allows a party within a relationship to put themselves in a vulnerable state where they expect positive outcomes or intentions and behaviors from the other party.  Supply chain management can be a source of competitive advantage for organizations. Signaling involves the exchange of information, and trust is a signal that organizations can look for to determine if a supply chain management relationship is worthwhile, leading to a stronger competitive advantage.  As supply chain management is a source of competitive advantage, managers need to be able to recognize signals of trust in a supply chain environment. Recognizing these signals of trust will help create stronger supply chain relationships and thus a stronger competitive advantage for the organizations that can trust each other as supply chain partners.  Research was conducted to determine what the signals of trust are in supply chain relationships between organizations.  This research was utilized to see which signals management should seek to know that they can trust a supplier in their supply chain.  Knowledge sharing, relationship commitment, effective communication, planning and collaboration, and engage in well-reasoned risk were cited as signals of trust in supply chain relationships.