Between Trust and Control: Developing Confidence in Partner Cooperation in Alliances

TLDR

Strategic alliances can foster opportunistic behavior among partners. The study investigates how firms develop confidence in partner cooperation, proposing that it derives from trust and control. The authors propose that control mechanisms influence trust, which in turn moderates how control is applied, and outline methods to build trust and implement control in alliances. They argue that trust and control are parallel, complementary sources that together generate confidence in partner cooperation.

Abstract

Strategic alliances have been recognized as arenas with potential for opportunistic behavior by partners. Hence, a firm needs to have an adequate level of confidence in its partner's cooperative behavior. In this article we examine the notion of confidence in partner cooperation in alliances and suggest that it comes from two distinct sources: trust and control. We make the argument that trust and control are parallel concepts and that their relationship is of a supplementary character in generating confidence. In addition, we suggest that control mechanisms have an impact on trust level and that the trust level moderates the effect of control mechanisms in determining the control level. Finally, we discuss various ways to build trust within strategic alliances and important alliance control mechanisms.