Academic journal article JITTA : Journal of Information Technology Theory and Application

A Conceptual Framework for Understanding Trust Building and Maintenance in Virtual Organizations

Academic journal article JITTA : Journal of Information Technology Theory and Application

A Conceptual Framework for Understanding Trust Building and Maintenance in Virtual Organizations

Article excerpt

ABSTRACT

The issue of trust development in traditional organizations has been widely discussed in the academic literature for several years. Recently, scholars have also studied trust development in temporary groups and have noted some fundamental differences between the manner in which trust develops in traditional organizations and the manner in which it develops in temporary groups. Virtual organizations are a new type of organization characterized by traits of both traditional organizations and temporary groups. This paper integrates the literature on trust in virtual organizations and the perspectives of trust development in both traditional organizations and temporary groups to develop a process-based framework which facilitates the understanding of trust development in the virtual organization setting.

INTRODUCTION

Recent years have witnessed dramatic advances in information and communication technologies (ICT), enabling new methods of collaboration among geographically distributed organizations (Kikrman, Rosen, Tesluk, and Gibson 2004; Montoya-Weiss, Massey, and Song 2001). The novel opportunity provided by advanced ICT and the increasingly intense competition facing organizations have led many to take advantage of global virtual organizations (VOs) (Montoya-Weiss, Massey, and Song 2001). Due to the numerous forms and structures VOs take, there is no universally accepted definition of the term VO. However, for the purposes of this paper, a VO is defined as "any organization form characterized by a temporary collection of geographically dispersed individuals, groups, or organizations that must trust each other and work together with the support of advanced information communication technology in order to explore a business opportunity that could otherwise not be explored" (Wang and Gwebu 2005). Examples of VOs include online auction sites, virtual product development teams, and virtual software development teams.

It is generally agreed that trust assumes an important role in the development and survival of VOs. Unlike in a traditional organization, VOs are characterized by lateral rather than vertical relationships (Snow and Miles, 1992). Vertical control, hierarchical authority, and formalized organizational procedures and policies are typically absent in VOs. Consequently, trust may act as a substitute for traditional control mechanisms by reducing transaction costs, minimizing uncertainty and risk, and helping in conflict and friction resolutions (Bromiley and Curley 1992; Cummings and Bromiley 1996; Jarvenpaa, Knoll, and Leidner 1998; Limerick and Cunnington 1993; Morris and McManus 2002; Sheppard and Tuchinsky 1996).

Although trust is pivotal in ensuring the existence and successful functioning of VOs, literature on trust development in such organizations is relatively underrepresented. Hence, the primary purpose of this paper is to propose a process-based framework that captures the manner in which trust develops in the VO setting. While trust building occurs at multiple levels of a VO, we only focus on trust at the individual level for the current study.

This study differs from the extant research on VO trust building in two important ways. First, most studies in the extant literature fall into the category of variance research which tends to focus on predicting and explaining the value of dependent variables (in this case, the level of trust) based on the values of other variables (antecedents/precursors of trust). Yet this approach provides little insight into how those values are established. Rather than focusing on identifying precursors of trust in VOs, this study draws on process theory and seeks to describe the relevant processes and conditions under which the antecedents will lead to trust in VOs. Second, drawing on the three sources of trust specified in Lewicki and Bunker.s model (1995, 1996) (i.e., Knowledge-based trust (KBT), Calculus-based Trust (CBT), and Identification-based Trust (IBT)) as a classification scheme, we categorize and discuss in our conceptual framework three important processes (KBT, IBT, and CBT building processes) that are necessary in order for the antecedents-trust relationship to occur. …

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