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Tài liệu Relationship between trust and cooperation an empirical study of inter organisational relationships in vietnam

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VIETNAM NATIONAL UNIVERSITY, HANOI VIETNAM JAPAN UNIVERSITY --------------------------- NGUYEN NGOC CUONG RELATIONSHIP BETWEEN TRUST AND COOPERATION: AN EMPIRICAL STUDY OF INTER-ORGANIZATIONAL RELATIONSHIPS IN VIETNAM MASTER'S THESIS Hanoi, 2020 VIETNAM NATIONAL UNIVERSITY, HANOI VIETNAM JAPAN UNIVERSITY --------------------------- NGUYEN NGOC CUONG RELATIONSHIP BETWEEN TRUST AND COOPERATION: AN EMPIRICAL STUDY OF INTER-ORGANIZATIONAL RELATIONSHIPS IN VIETNAM MAJOR: BUSINESS ADMINISTRATION CODE: 8340101.1 RESEARCH SUPERVISORS: Assoc. Prof. Dr. VU ANH DUNG Assoc. Prof. Dr. KODO YOKOZAWA Hanoi, 2020 TABLE OF CONTENTS LIST OF TABLES .................................................................................................. iii LIST OF FIGURES ................................................................................................ iv LIST OF ABBREVIATIONS ................................................................................. v ACKNOWLEDGEMENT...................................................................................... vi ABSTRACT ............................................................................................................ vii CHAPTER 1: INTRODUCTION........................................................................... 1 1.1 Practical issues .................................................................................................. 1 1.2 Theoretical gap and research objective ............................................................. 2 CHAPTER 2: LITERATURE REVIEW .............................................................. 3 2.1 Trust .................................................................................................................. 3 2.2 Relationship commitment ................................................................................. 4 2.3 Cooperation ....................................................................................................... 5 2.4 Theoretical gap .................................................................................................. 5 2.5 Hypothesis formulation ..................................................................................... 8 2.6 Research model ............................................................................................... 10 CHAPTER 3: METHODOLOGY AND DATA COLLECTION ..................... 11 3.1 Research scope ................................................................................................ 11 3.2 Research design ............................................................................................... 11 3.3 Research scales................................................................................................ 12 3.4 Process of collecting data ................................................................................ 13 3.5 Characteristics of respondents......................................................................... 14 3.6 Descriptive statistics analysis .......................................................................... 17 3.7 Reliability and validity .................................................................................... 19 i CHAPTER 4: DATA ANALYSIS AND DISCUSSION ..................................... 23 4.1 Exploratory factor analysis of CT and AT ...................................................... 23 4.2 Correlation coefficients analysis ..................................................................... 24 4.3 Regression analysis ......................................................................................... 26 4.3.1 Regression with AT as dependent variable ............................................. 26 4.3.2 Regression with RC as dependent variable ............................................. 27 4.3.3 Regression with COO as dependent variable .......................................... 29 4.4 Discussion ....................................................................................................... 32 CHAPTER 5: CONCLUSION ............................................................................. 35 5.1 Theoretical contributions ................................................................................ 35 5.2 Managerial implications .................................................................................. 36 5.3 Limitations and recommendations .................................................................. 37 REFERENCES....................................................................................................... 39 APPENDIXES ........................................................................................................ 45 APPENDIX 1: ITEMS IN MEASUREMENT SCALES ..................................... 45 APPENDIX 2: QUESTIONNAIRE SURVEY ..................................................... 46 ii LIST OF TABLES Table 3.1. Demographic characteristic of respondents ........................................... 14 Table 3.2. Mean and standard deviation ................................................................. 17 Table 3.3. Cronbach’s Alpha................................................................................... 20 Table 4.1. EFA of CT and AT................................................................................. 23 Table 4.2. Transforming representative factors ...................................................... 24 Table 4.3. Correlation coefficients Matrix Analysis ............................................... 25 Table 4.4. Regression with AT as dependent variable ............................................ 26 Table 4.5. Regression with RC as dependent variable (CT is predictor) ................ 27 Table 4.6. Regression with RC as dependent variable (AT is predictor) ................ 28 Table 4.7. Regression with COO as dependent variable (RC is predictor) ............. 29 Table 4.8. Regression with COO as dependent variable (CT is predictor) ............. 30 Table 4.9. Regression with COO as dependent variable (AT is predictor) ............. 31 Table 4.10. Summary of the hypothesis testing ...................................................... 32 iii LIST OF FIGURES Figure 2.1. Conceptual model ................................................................................. 10 Figure 4.1. Conceptual model in Vietnam .............................................................. 32 iv LIST OF ABBREVIATIONS AT Affective trust COO Cooperation CT Cognitive trust EFA Exploratory factor analysis RC Relationship commitment v ACKNOWLEDGEMENT Firstly, I would like to express deepest gratitude to my parents, who always respect my decisions and support me for what I have committed. Their belief and supports have made my confidence to face challenges and move forward. Likewise, I am grateful to my supervisors Associate Professor Kodo Yokozawa and Associate Professor Vu Anh Dung for making this research project possible. Associate Professor Kodo Yokozawa has been kindly, patiently and enthusiastically accompanied and facilitated me in the process of researching from the idea formation to every step on how to do a good scientific research. Whilst, Associate Professor Vu Anh Dung critically evaluated the matters and logically explained the reasons of my research. His advices helped me recognize the limitations and learnt to improve them in the research. Thanks to my supervisors, my knowledge in the academic research has been truly enriched. I am also thankful to all experts, lecturers and staffs from Japan International Cooperation Agency (JICA), Vietnam National University (VNU), Yokohama National University (YNU), Vietnam Japan University (VNU), Waseda University as well as those, who participated in the questionnaire survey. Thanks to all of you, I really had a memorable and enjoyable time during my post graduate study. Last but not least, I would like to send a special thank you to Dr. Yoshifumi Hino. I sincerely appreciated and enjoyed the time and the process of learning quantitative research, economics and Japanese language from him. Nguyen Ngoc Cuong vi ABSTRACT This study examined the relationship between trust and cooperation in an interorganizational level. A conceptual model was proposed here, which consisted of affective trust, cognitive trust, relationship commitment and cooperation. A total of 90 usable questionnaires were explored to test the conceptual model using the exploratory factor analysis, correlation and regression analysis on SPSS 26.0 in a current emerging economy. The study result presented an insignificant direct relationship between affective trust and cognitive trust with cooperation. Cognitive trust was highlighted as the foundation for interorganizational relationship while affective trust was emphasized with the stronger impact on relationship commitment, which influenced positively cooperation. Further managerial implications for practices, limitations and recommendations were also discussed. vii CHAPTER 1: INTRODUCTION 1.1 Practical issues Cooperation played crucial roles in business practices since it can promote relational exchanges, effective competitions, enhances a flow of information and business transaction (Morgan & Hunt, 1994). Despite its important roles and benefits, business practicers find it challenging to achieve effective cooperation in Vietnam. The characteristics of the environment here was described with some frequencies of one time deal approach, inadequacy of company profile data the shortage of proper procedures, or the absence of developed infrastructures (Nguyen & Rose, 2009). It is quite common to experience the late time of product delivery, the unqualified product quality or the lack of delivering professional customer services from the suppliers here. All of these caused difficulties for focal firms to foster relationships with the suppliers to achieve shared goals and have motivations to maintain the exchanged relationships. Thus, this research is motivated to find out the key for effective cooperation to be applied in Vietnamese business practices. Studying inter-organizational cooperation in the literature review, the researcher was persuaded with the commitment-trust theory by Morgan and Hunt (1994). Accordingly, trust and relationship commitment were explained to be the keys to make cooperation effective. Morgan and Hunt (1994) also proposed important factors that impacted trust and relationship commitment such as the termination cost, benefits, shared values, communication or opportunistic behaviors, which helped the researcher gain insight ideas of how to achieve these keys for effective cooperation. 1 1.2 Theoretical gap and research objective In the theory, the direct relationship of trust on cooperation in an emerging economy is questionable. The inter-organizational trust was researched for over decades (Seppänen, Blomqvist, & Sundqvist, 2007) but was mainly studied in the developed economies (e.g., Morgan & Hunt, 1994; Zineldin & Jonsson, 2000; Abosag, Tynan, & Lewis, 2006). Thus, there was currently insufficient study of the relationship between trust and cooperation in the emerging market economies, where the researcher believed in the less impacts of trust on cooperation as it influenced in the developed economies. It is important to understand such relationship in an emerging economy such as Vietnam from scientific and practical aspects. Therefore, the objective of this research is to test the relationship between trust and cooperation with a mediating variable of relationship commitment in focus on the relationships between focal firms with their suppliers. Six hypotheses on the relationship between trust and cooperation in the Vietnamese business context are set and tested. It is expected an insignificant relationship between trust and cooperation in an emerging economy, which will become a theoretical contribution of the research. 2 CHAPTER 2: LITERATURE REVIEW 2.1 Trust The literature surveyed on interorganizational trust, highlighted the primary conceptualization of trust as confidence, belief, willingness or expectation on exchange partners to fulfil their obligations (Zaheer & Harris, 2005); however, later studies showed a lack of consistent agreements for the appropriate conceptualization and operationalization in the trust context (Abosag et al., 2006; Seppänen et al., 2007). This research shared the perspective with one of the most cited theories on the context of interorganizational trust from Morgan and Hunt (1994), who argued the redundancy of willingness in trust definition and indicated importantly the confidence; therefore, trust was redefined persuasively as the confidence in the reliability and integrity from the partners that the focal firm exchange with (Morgan & Hunt, 1994). Later studies were also persuaded with the conceptualization of confidence and be applied in interorganizational cooperation (Dyer & Chu, 2000) or industrial marketing relationships (Cooote, Forrest & Tam, 2003). Being consistent with the above conceptualization, trust was also distinguished by feeling and rational thinking (McAllister, 1995; Johnson & Grayson, 2005). Previous studies categorized trust into two dimensions of cognitive trust and affective trust (e.g., Lewis & Weigert, 1985; McAllister, 1995; Mo l̈ lering, 2002; Johnson & Grayson, 2005). The reviews on interorganizational trust from 1990 to 2003 also highly recommended include cognitive and affective dimensions to capture interorganizational trust (Seppänen et al., 2007). 3 Accordingly, cognitive trust is the confidence, which is founded on the knowledge of the party’s performance and capabilities. This critical thinking is necessary to reduce the uncertain behaviors due to some degree of risk on the party’s behavior in the future (Eriksson & Sharma, 2003); therefore, strengthening the relationships with their exchange partners. Whilst, the affection trust is the confidence, which is based on the natural feeling from the experience of receiving caring or concerns in transaction processes with exchanged parties (e.g., Lewis & Weigert, 1985; McAllister, 1995; Mo l̈ lering, 2002; Johnson & Grayson, 2005). This emotional trust is motivated by the partners’ goodwill (Ring & Van de ven, 1994) and shared values (Morgan & Hunt, 1994); which showed the willingness and quality of interaction in promoting the relationships. 2.2 Relationship commitment Similar to trust, relationship commitment has been seen in different disciplinary to have a central position in developing sustainable relationships (Abosag et al., 2006). It was not forced but earned, which revealed the willingness or intention to maintain in a long-term process rather than short-term alternatives (Zineldin & Jonsson, 2000). Based on the definition of relationship commitment in social exchange (Cook & Emerson, 1978), organizations (Meyer & Allen, 1984), strategic marketing and relationship management (Zineldin & Jonsson, 2000), this research conceptualized the relationship commitment as the belief on the importance of collaborating and maintaining the exchange relationship as well as the intention to endure it sustainably. It has become crucial since the belief naturally leads to the positive perceiving toward the exchanged partners while the willingness will result in collaborating behaviors and activities to enhance the productivity and effectiveness of the relationships. 4 This definition corresponds closely with the development of Morrman, Deshpande and Zaltman (1993, p.316) as the “enduring desire to maintain a valued relationship” and the conceptualization of Morgan and Hunt (1994) as a belief the relationship is worthy to endure sustainably and be willing to maximize the efforts on maintaining. 2.3 Cooperation Cooperation was defined as the situation which exchange partners worked together to achieve mutual goals (Anderson & Narus, 1990; Skinner, Gassenheimer, & Kelley, 1992). Morgan and Hunt (1994) highlighted that the effective cooperation could promote an effective competition within network and enhance the success of the relationship marketing. Previous research on interorganizational study also emphasized the importance to understand how to develop and maintain cooperation to acquire sustainable satisfying relationships (Childers & Ruekert, 1982). Later, cooperation has been viewed with the temporary conflicts within the process (Frazier, 1983; Morgan & Hunt, 1994). 2.4 Theoretical gap The practical roles and benefits of inter-organizational trust continuously fascinated the study by various scholars and business practicers. Trust was considered as a primary source of sustainable competitive advantage as well as the main factor to improve the organization’s business capacity (e.g., Barney & Hansen, 1994; Seppänen et al., 2007). Nevertheless, trust facilitated information exchanges, cooperative behaviors and reduced costs of transaction and relationship conflicts (Nguyen, Babar, & Verner, 2006). In academic study, trust varied from economy, psychology, sociology to business, especially in the area of industrial marketing relationship and strategic alliance 5 (Morgan & Hunt, 1994). In the interorganizational level, the research primarily focused on the relationships between buyers and sellers, business and business, suppliers and manufacturers (Seppänen et al., 2007). Despite its important roles and benefits, the nature of trust makes it risky in trusting their partners due to the possibility of uncertain anticipation for the party to behave opportunistically (Zaheer, McEvily, & Perrone, 1998; Dominique, 2012). The degree of freedom to disappoint the relationship’s expectation are still possible (Gambetta, 2000; Abosag et al., 2006) and makes it challenging for the exchange partners to assess this occurrence (Hosmer, 1995). Together with the natural risk of trust itself, the risk for investments are even higher in the emerging economies. The emerging nations are still in the process of industrialization and modernization; therefore, the lack of advanced infrastructures or the consistency in accounting or financial information will cause it riskier to do business in the emerging markets rather than in other developed economy nations. That is to say, the higher risks in the in the emerging markets might limit the effect of trust on cooperation even though primary studies of trust and cooperation in developed economies showed the supported direct relationship of trust and cooperation in their nations (Morgan & Hunt, 1994; Zineldin & Jonsson, 2000; Abosag et al., 2006). This belief was also strengthened since Glaser-Segura (1998) statistically discovered the unsupported interorganizational trust and interorganizational cooperation Mexico. Furthermore, the previous studies indicated the different level of cognitive trust and affective trust in fostering the relationship exchange and cooperation. The structural model of Park, Lee, Jang, and Lee (2013) also found the unsupported direct relationship between affective trust and the intention to use from the focal firms. 6 This shapes a research belief that different type of trust may have different impact on the cooperation; therefore, it is motivated to find out whether cognitive and affective trusts have direct impact on cooperation or not. If so, which type of trust can have higher impact on the cooperation in the emerging market economy? 7 2.5 Hypothesis formulation In this section, six hypothesizes have been formed to address the research questions. Hypothesis 1: Cognitive trust positively influences affective trust There was occurrence of bidirectional causal effect between cognitive trust and affective trust since cognitive trust firstly occurred and became the base for developing affective trust but when affective trust developed to a certain level, reverse causal direction might occur (McAllister, 1995). However, that mature level involved with risk as it based on emotion rather than knowledge of partners’ business performance, therefore, it was more natural to see the initial development of cognitive trust for secure and its influence on affective trust. For instance, having a belief in the suppliers’ actual performance could open the committed partners in sharing information actively and openly. This direction, therefore, was made on hypothesis one, which was also consistent with the proven dependence of affective trust on cognitive trust in an organizational level (McAllister, 1995). In the interorganizational relationship, the direct impact of cognitive trust on affective trust was also confirmed in relationship marketing (Morgan & Hunt, 1994); financial consulting environment (Johnson & Grayson, 2005), international trading (Zur, Leckie & Webster, 2012) or information technology service (Scott, 2000; Park et al., 2013). Hypothesis 2: Cognitive trust positively influences relationship commitment Hypothesis 3: Affective trust positively influences relationship commitment The two above hypothesizes are also proposed in the research. Accordingly, Moorman, Deshpand and Zalman (1993) emphasized that exchanged partners valued and committed to the relationship, which characterized by trust. Later, Morgan and Hunt (1994) proved trust as the major influence on the relationship 8 commitment in the relational exchange. The causal relationship from trust to relationship commitment was also determined by a variety of authors in interorganizational level (Zineldin & Jonsson, 2000; Abosag et al., 2006; Park et al., 2013; Jeong & Oh, 2017; Wang, Tajvidi, Lin & Hajli, 2019; Cui, Mou, Cohen, Liu & Kurcz, 2020) Hypothesis 4: Relationship commitment positively influences cooperation The hypothesis four was formulated. To make the relationship work properly and efficiently, a partner who is committed to the exchange relations will cooperate with others (Morgan & Hunt, 1994). Similarly, both theories and empirical research has proven this relationship and found the significant influence of relationship commitment on cooperation in various contexts (Zineldin & Jonsson, 2000; Abosag et al., 2006; Park et al., 2013). Hypothesis 5: Cognitive trust positively influences cooperation Hypothesis 6: Affective trust positively influences cooperation The above hypotheses were made. In a market where the quantities of suppliers are limited, cooperation might be taken temporarily in the initial establishment of the relational exchange process. In this situation, trust might form and develop in the middle of the process by a certain period of time with the flow of business transactions. However, this direction did not often happen and involved with higher risk for the success of business transaction. To secure the business, especially in a long term, the performance and the goodwill of the suppliers should be evaluated prior for cooperation to be established. It was persuaded that the partner would undertake action of cooperating when trust existed (Pruitt, 1981; Anderson & Narus, 1990). The empirical research from Morgan and Hunt (1994) also indicated a direct impact of trust on cooperation since coordinating activities required trust in their 9 partner. The direction was also consistent with other studies in cross-national contexts (e.g., Abosag et al. 2006; Martins, Faria, Prearo, & Arruda, 2016). 2.6 Research model From the above hypothesizes, a conceptual model was proposed to investigate the relationship between trust and cooperation with mediating variable as relationship commitment (Figure 2.1). Figure 2.1. Conceptual model 10 CHAPTER 3: METHODOLOGY AND DATA COLLECTION 3.1 Research scope Vietnam was selected for its relevance with the phenomenon of the research. The country was one of the most vibrant emerging market economies in East Asia region (Worldbank, 2019). Despite the challenges that committed suppliers might neither have sufficient competence performance nor enthusiastic attitude to cooperate for long-term relationship developments, this prospective nation has still attracted an increasing number of foreign direct investments with numerous opportunities. Since it is highly valuable to measure how trust was perceived for the measurement of these interorganizational levels (Mo l̈ lering, 2002), this would investigate the perception from the focal firms or non-governmental organizations that purchased, partnered or consumed the products and services from their exchanged suppliers. 3.2 Research design The quantitative research was implemented to examine the conceptual model with collected data through online questionnaire survey. The questionnaire included three sections. Section one was an introductory letter that briefed the topic, its objectives, an estimated time, confidentiality and appreciation for participation. While the second section was designed for demographic information, the last section composed twenty one questionnaire items. An additional open question was also made for further recommendation from respondents. 11
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