Relational trust and embeddedness in interorganizational networks : an analysis of quality control manager networks in Japanese buyer-supplier relations

Abstract

The reciprocity and reputation in social networks are considered as important factors to develop mutual trust in interfirm cooperation. Because of new insights gleaned from the embeddedness approach, many researchers discuss this by giving considerable attention to the special quality of ties and the structural properties of social networks that facilitate the building of interorganizational trust. In studies of Japanese buyer-supplier relations, strong and multiplex ties in social networks between managers that span organizational boundaries often facilitate the development of interorganizational trust in goodwill. However, it still remains unclear how social networks actually help the development of interorganizational trust in goodwill. In keeping with the embeddedness approach, the aim of this paper is to consider how a high level of relational embeddedness in the social networks of managers across organizations develops positive recognition of relational trust in goodwill between organizations, and how special properties of structural embeddedness also amplify this trust. To examine this phenomenon, I empirically analyze trust and embeddedness in the social networks of managers within two supplier associations of Japanese electronic manufacturers.