Word Count: 5,000
Table of Contents
Antecedent of trust in strategic Alliances. 4
Antecedent of Trust in Strategic Alliances. 6
Variables that influences antecedent to trust. 8
Effects and results of Antecedent of Trust in Strategic Alliances. 11
Importance of antecedent of trust in S.A.. 13
Future Research and implications. 20
Abstract
This article presents a comprehensive review of the literature on Antecedent of Trust in Strategic Alliances. In this paper, we present a framework that investigates trust in the strategic alliances using various sources. Overall, after conducting the research, this research found that information exchange, fairness, network relationships, communication, type of alliances has implications for the trust in the strategic alliance. Typically, trust is a core factor that cannot be underestimated in enhancing success of the strategic alliance. Trust facilitates discipline and obtainment of goals in an organization. For firms to be successful, goods and services have to be satisfactory, acceptable and worth purchasing. With the integration of industry-related issues including service marketing concepts and long-term business association, trust has become an important factor of enhancing growth in the organization. Given the importance and role of trust in strategic alliances for both international and local business, this research explored the antecedents of trust in depth.
Antecedent of trust in strategic Alliances
Introduction
Trust is a core factor that cannot be underestimated in enhancing growth in the organizations. By definition, trust is an activity or service that is intangible or tangible between two people. According to Akbar &Parvez (2009) trust is a belief that something is effective, good, reliable, honest, and worth considerate. In response to this research, Angelova &Zekiri (2011) also believed that trust is the confidence that an individual has that something is good. Trust creates a strong ground for consumers to trust an organization because of the goods and services offered. Despite the benefits that emerge from trust, most organizations have encountered problems evaluating how to foster trust in their services. As Ariffin & Aziz (2011) describe the process of trust, an individual or else an organization must invest of rewarding favor, gifts, and activities to increase their trust to consumers. Specifically, consumers must trust an organization to maintain the relationship. Various researchers have been done to portray how trust is gained. For instance, social exchange theory portrays that there must be an open-ended, broad, and unspecified obligations for any trust to occur (Voon, 2011). In this case, the obligations may be based on the fact that, voluntary actions are more likely to bring forth good results (Baker &Saren, 2010). The key concepts postulated in the social exchange theory are that, there must be give and take relationship and the social exchange may not always be an explicit arrangement. The give and take relationship occurs when an organization invest its resources to introduce rewarding activities with a intention of creating trust and converting new clients to potential and frequent buyers (Bolton &Lyer, 2009). The social exchange theory is a significant perspective to examine the social context in which the transactions of strategic alliances are made. Thus, this paper will provides adequate information about trust in strategic alliance as provided by the social exchange theory. To gather adequate findings of the research, this research collected information from a number of articles. Basically, I choose recent articles such as the article by Musriha published in 2012. The purpose of this was to ensure that the researched information relates to the modern age. The snowball methodology was used to locate most articles for the study. Obtaining the various articles involved a sequential development from a single article on the theme ad further explored the key concepts of the subject.
Strategic Alliances
Strategic alliances have been common forms of organization strategies that increase competitive advantage. It is undeniable that, trust is an essential component that fosters successful international strategic alliance. Musriha (2012) believes that the association of strategic alliance creates a strong platform for organizations to undertake a specific beneficial project. Basu &Biswas (2012) and Brito (2011) define strategic alliance as the process where two or more organizations unite to work and pursue the set goals and objectives. On other hand, Sahaf (2008) believes that a strategic alliance is a process where firms share the same benefits ad control over their assigned duties and responsibilities. This research also reveals that a strategic alliance is a continuing basis in the key strategic areas. The three types of the strategic alliances are minority equity, joint ventures, and non-equity alliances.
Key Learning
Most authors believe that strategic alliance is a crucial strategy that increases competitive advantage in the modern age. Further, most authors agree that trust is core component that enhance success in strategic alliances. Although every author presents different views about strategic alliances, their literature presents three types of the strategic alliances; minority equity, joint ventures, and non-equity alliances.
Antecedent of Trust in Strategic Alliances
At this point, this literature will utilize social exchange theory to analyze and identify factors that influence trust in the strategic alliance. Basically, social exchange theory is derived from the sociological perspective, which based its concepts of economics (Alipour &Darabi, 2011).According to social exchange theory; there must be broad and open-ended obligations for any party involved in any relationship. A different research by Alfadly (2012) postulates that, social behavior occur after an exchange process. The aim of this exchange is to minimize costs and maximize the benefits of social relationships. This research continues to argue when the risks outweigh the benefits or rewards, then people are more likely to abandon or terminate relationship. The key concepts of the social exchange theory as argued by Akbar &Parvez (2009) are that, there must be give and take form of social exchange. It is important to note that, the social exchange may not always be an explicit arrangement. Overall, social exchange theory is a crucial perspective to examine the social context. It lays a strong for people to comprehend the transactions that occur in strategic alliances. Typically, Akhtar (2011) also believes that social exchange theory provides a strong foundation to examine the concept of trusts in the strategic alliance.
As previously mentioned, trust is an exchange of activity, which may intangible or tangible and less or more rewarding between two people. As Donaldson & O’Toole (2007) describe the process, people often initiate exchange by investing on small things or offering rewarding activities, favor, or gift. In any kind of relationships, trust is very important (Baker, Baker&Saren 2010; Basu&Biswas 2012; Biswas 2011). A study carried out by Akbar and Parvez found out that ‘trust and the satisfaction of the client are significantly and positively related to customer loyalty’, (Akbar&Parvez 2009). Customer satisfaction also proved an important facilitator between customer loyalty and service quality (Bolton, Grewal&Levy 2007; Bolton&Lyer 2009). The important variables that help the sales people earn a buyer’s trust on the other hand include dependability, expertise, customer orientation, honesty and compatibility.
The concept of relationship marketing further relies on a move from function-based marketing to cross-function marketing and a shift from marketing activities that emphasizes on customer acquisition and trust to those emphasizing customer retention. Relationship marketing is therefore built upon the relationship between customer loyalty, consumer contentment and profitability. Rather than concentrating on acquiring new customers, firms should focus on retaining the existing ones and turning them into partners and advocates through interaction marketing, database marketing and network marketing (Baron et al).
In order for relationship marketing to be established and retained between the service supplier and the customer, a relationship has to be established and worked on (Compton&Baizerman2011). The relationship must also be long-term and should be between the providing organization and the customer in question (Dash, Bruning&Guin 2007; Donaldson&O’Toole 2007; Dukic&Kijevcanin 2012). Moreover, the relationship should be for mutual benefit of both parties. Relationship in marketing can be retained through adding financial benefits, adding structural ties and adding social benefits. In order to strengthen and maintain relationships, firms must also offer quality, trust, satisfaction, commitment, power dependence, and idiosyncratic investments (Gbettor,Avorga, Danku&Atatsi 2013;Goi 2009; Gunelius 2011). Despite the importance of relationship marketing, research shows that consumer service providers often use a transactional marketing approach which was commonly used by business-to-business service firms.
In the modern businesses, trust has proved to be the basis of strategic partnerships and the mediating element in any buyer-seller relationships. Trust has also been found to be the bottom-line of the relational approach and the key to the development of commitment notion in buyer/seller relationships (Huotari&Hamari 2012). It is also the basic element in establishing lasting relations with customers and the maintenance of the firm’s market share. In their study on restaurant suppliers and consumers, Jones and McCleary discovered that trust is considerably related to seven variables important in buyer-consumer relationships in terms of quality (Hussain,Dogar, Azeem&Shakoor 2011), performance, satisfaction, communication, price, accommodation, cooperation and social bonding (2009).
Variables that influences antecedent to trust
When exploring the antecedents of trust in strategic alliance, it is crucial to understand variable that influence trusts. At this point, this literature review will analyze six variables that are key antecedents of trust. These variables are communication, information exchange, inter-firm adaptation, fairness preservation, type of alliances, and network relationships.
Network relationships
By definition, network relationships are the structure of ties that occur between economic parties in the social system (Boone & Kurtz, 2012). In this case, the parties may refer to organizations, individuals, and groups ties that may include information exchange, economic, kinship, friendship, affection, and conversation exchange. When there is network relationship between parties in the same industries, it is more likely that the parties will have formed a strong relationship with their potential partner. In some cases, the parties may have had previous business relationship. Having or knowing information about strategic alliance partners have been known to be an important factor that influences trust.
Type of Alliances
As strategic alliances are two or more firms that unite to pursue a set of agreed goals and objectives. Basically, there are three types of strategic alliances; minority equity alliances, joint ventures, and non-equity alliances (Boone & Kurtz, 2012). By definition, joint ventures are separately incorporated entities, which are separate from the main or “parent organization”, but operate alike. The minority equity alliance occurs when one party or organization takes an equity stake in its associate. Non-equity alliances occurs when there is no sharing or the exchange of equity. In their research, Bolton, Grewal & Levy (2007) further supported Sahaf (2008) research by affirming that, trust is usually created through strict contracts because there is contractual control. However, in non-equity alliance, confidence is usually created because there is no exchange or sharing of equity. The orientation of quality is acknowledged by an organizational promise to developing and sustaining core competencies based on the quality offered. Regretfully, whereas value (quality) is a persuasive concern, it remains a theoretical characteristic that has been defined in different ways.
Communication and Information Exchange
Arguing from the social behavioral theories point of view, honest and effective communication and information exchange occurs when there is trust (Dash, Bruning &Guin, 2007). Brito (2011) defines communication as the process of sharing informal and formal message between partner firms. This research continues to argue that communication is closely related to success, which occurs through trust. It is crucial to note that, communication is an indispensable aspect of a trusting relationship. When explaining this in terms of social exchange theory, this research postulates that trust thrives in the environment where there is effective communication and information exchange. These processes are important aspects of social exchange (Bejou & Palmer, 2012).
Fairness Preservation
By definition, fairness preservation is the degree to which organization part judges the other in terms of commitment. Based on social exchange theory, participants in the relationship must morally oblige to give something that is worth exchange. For a strong relationship to occur there must be justice between parties (Bejou & Palmer, 2012).
Inter-firm adaptation
This is process where organizations adjust their behavioral patterns to fit their partners. Arguing from social exchange theory perspective, trust can be attained through inter-firm adaptation (Brito, 2011). This theory assumes that the process of exchange clearly demonstrates trustworthiness. Specifically, exchanges that occur from adaptations lead to the building of trusts between two partners in the strategic alliances.
Key Learning
The antecedent of trust in the strategic alliances is explained through the social exchange theory. Basically, this research portrays that there must be give and take in the form of social exchange. Overall, social exchange theory is a crucial perspective widely used to examine the social context. Further, this research continues to outline the key factors that influences trust in the strategic alliance. These factors include communication and information exchange, fair preservation, inter-firm adaptation, and network relationships.
Effects and results of Antecedent of Trust in Strategic Alliances
In their research, Rahnama & Beiki (2013) found that, trust is closely associated with satisfaction and growth in sales and profit. However, creating value and satisfaction are at the very heart of service marketing (Goi 2009; Hightower& Shariat2009). Researchers agree that marketing is the distinguishing and unique function of a business (Jain, Grover&Singla 2007; Jain 2009). Trust in this case helps in communication between the society and the firm, increasing profits, business planning and decision making, distribution, bridging the gap between producers/manufacturers and consumers while acting as a facilitator for firms (Rahnama&Beiki 2013). Ideally, the product characteristic of a service refers to the variety and depth of the service offered and the area of operation (Bon&Mustafa 2013). It is mainly concerned with the matching of services to the target markets.
The effect of trust is an important factor to consider in the development of strategic alliances (Pai& Chary 2012; Sichtmann 2007; Abdul, Gaur &Penaloza 2012). As a basic relationship-building block, trust is defined as an acceptance that one relationship-partner acts upon the interest of the other (Cater 2007). A seller can in this case create confidence in the eyes of the buyer by being credible and following through on what it promises. Researchers agree that one of the best tools for establishing trust is effective communications. In order to enhance relationships, it is important for the businesses to be honest, open, clear and thorough (Rahnama & Beiki, 2013). Establishing a good channel of communication can also help avoid unwarranted disasters and loss of customer trust. In fact, it is believed that trust is the only important factor for customers choosing an online supplier. The more a customer gets confidence in a service provider, the more they are likely to remain in the relationship and the more they feel areal and demonstrative commitment to their relationship with the service providers.
In a relationship that is intended to last, there is also fair sharing of rewards and risks, high level of trust and commitment, clear understanding of each person’s roles and obligations, common sharing of information, long-term orientation, responsiveness towards each other’s needs and a sincere wish to win (Inayatullah, Narain, Singh 2012). As far as customers are concerned, the paybacks of tight relationships with suppliers at the operating levels are given as improved quality of products and services, reduced lead-time and cost and service completion time. At the strategic level, the benefits are acquired in form of increased innovation (Wang, Bradford, Xu&Weitz 2008) and market share and enhanced competitiveness (Inayatullah et. al 2012). Marketers should look for a strategic approach of retaining, upgrading and ending relationships with customers (Nigam 2011; Pai&Chary 2012; RaskovicBrencic, Fransoo&Morec 2012). Customer retention involves developing cost-effective and long-term relationships with the customers for the mutual benefit of all involved parties. Research on the other hand confirms that customer profitability and return on sales can be increased by concentrating on the top notch customers. Consequently, it is required of service organizations to appreciate the needs of customers within different profitability tiers and adjust the service levels accordingly (Sahaf 2008).
Key Learning
After collecting information from different authors, there are various key points that most authors agree on. Overall, most authors believe that trust increases good and solid relationships. It also increases communication and information exchange. When business trust each other, they are more likely to agree and work on the set goals and objectives. With this in mind, this research postulates that businesses are more likely to grow when they embrace trust in their endeavors. Businesses are also encouraged to appreciate the needs of customers to succeed in global world.S
Importance of antecedent of trust in S.A
The literature on trust additionally advises that confidence on the part of the trusting party results from the belief that the trustworthy party is reliable and has high collectivity associated with competency, consistency, honesty, helpful, being responsible, fairness and benevolent (Kabadayi, Alan&Erdebil 2011; Canning&Lloyd 2007). Other reviews concluded that trust and its indicators, co-operative synergy, information-collaboration and low levels of supposed risks make up the most essential feature of an exchange-relationship. In business relationships, the major cognitive trust-building processes include prediction, calculative, transference, intentionality and capability (Jones&McCleary 2009). Maintaining successful channel partner relationship in this case requires the development, maintenance and improvement on the dynamics of a relationship within the supply chain (Ng 2009).
Trust has recently emerged an important issue in strategic alliances (Yusof, Hassan, Rahman&Ghouri 2012; Siddique, Karim&Rahman 2011). In the modern competitive world, the quality of a service has proved an essential strategy for competitive advantage (Ensuring customer and satisfaction and loyalty are the key issues of the marketing practitioners (Dukic&Kijevcanin 2012). This is more so for the modern firms which have to deal with numerous challenges in the new environment. Delivering quality service is actually an essential strategy for survival and success in today’s competitive world (Basu&Biswas 2012). This is considering that high service quality provides a competitive advantage edge for an organization that can lead to the organizational growth. On the other hand, based on lifestyle, purchasing power, dynamism of customers’ differentiation, expectations and preferences pose many challenges and issues in satisfying customers.
In most sectors, research shows that perceived service quality contributes to customer satisfaction, repeat visits, strategic benefits and positive feedback (Akbar&Parvez 2009). In their review of literature, Akbar and Parvez further noted that service quality has traditionally been hypothesized as the variance between customer expectations regarding a service to be received and perceptions of the service being received (2009). As a result, an understanding of customer perceptions of quality is important when examining efforts by a firm that is to be directed toward factors that are important to the particular customer.
As also noted byPai and Chary, service quality is the customer’s insight of the level of success or failure in meeting expectations (Pai&Chary 2012; Yusof et al. 2012). Generally, most researchers measure service quality using customer evaluation of reliability, tangibles, assurance, empathy and responsiveness (Basu&Biswas 2012). This insight was also noted in Akbar and Parvez’s study where five scopes of service quality including empathy, reliability, assurance, responsiveness, and tangibles were realized as the qualities that connect specific service characteristics to consumers’ anticipations (Akbar&Parvez 2009). Since the perceptions of service quality are based on various dimensions (Leacock&Nesbit 2007) there is no one general agreement about the nature or content of the dimensions.
As argued by social exchange theory, trust is an important factor to the development of a quality strategy (Akbar&Parvez 2009). In their descriptive study on private commercial banks in Bangladesh, Rahaman and colleagues further perceived service quality as an approach to manage business processes in order to ensure full satisfaction of the customers which in the long run increases effectiveness and competitiveness of an industry (Rahaman, Abdullah &Rahman 2011). It is therefore important to design service products based on pricing paradigms and customer needs while introducing to customers actively.
Numerous researchers show that customers’ value for a company increases with extension of the period of their bonding. Trust in strategic alliance enhances the business productivity due to gained experience and better understanding (Dukic&Kijevcanin 2012). In order to determine customer loyalty of a service, the satisfaction must be cumulative by existing in each transaction. Other researchers consider responsiveness, reliability, access, competence, communication, courtesy, security, credibility, tangibles and understanding of the customer as the main determinants of quality service (Lee 2011, p.61). In their empirical study on customer’s perception about the determinants of service quality of foreign and domestic banks,Siddique, Karim and Rahman concluded that reliability, credibility, communication, tangibility and security are the factors affecting the service quality for domestic private banks (2011, p.1). This was compared with credibility, reliability and tangibility characteristics which were the only factors seen to affect the quality of service in the foreign banks (Siddique et al. 2011).
In today’s increasingly competitive world market, buyers find themselves presented with choices regarding suppliers and their products (Ahmed 2013; Alias, Roslin&Shariff 2013; Brito 2011). In this important market, the traditional methods of selling that focused on closing the sale (Botha&Brink 2007; Fichtel 2009) have proved inefficient and often counterproductive to the firm’s long-term and sustainable strategies. Today, relationship marketing represents a fundamental transformation from traditional marketing in that relationships shift from adversarial to cooperative and the goals shift from market share to share of customers (Akhtar 2011). Customers must in this case move from a short-lived transaction-orientation to a long-term and long lived relationship building goal (Akbar&Parvez 2009; Akhtar 2011). In the new economy, services will not matter as much as the relationship between the customer and the company (Bon&Mustafa 2013;Ariffin&Aziz 2012).
Ideally, the shift toward relationship selling has today changed both the roles played by the marketers (sales people) and the skills and activities they exercise in carrying out the presented roles (the selling process itself) (Ariffin, Bibon&Abdullah 2011). Today’s more contemporary selling process is embedded within the relationship marketing paradigm (Bon&Mustafa 2013; Basu&Biswas 2012). Consequently, it emphasizes the initiation and fostering of enduring consumer-seller relationships based on value-added benefits and sharedfaith.As noted by Akbar and Parvez, the activities and skills essential for relationship selling can be classified according to their purpose in terms of the initiation, development, and enhancement of the relationships (Akbar&Parvez 2009).
Most researchers suggest that trust, selling approach and relationship-marketing are the most sufficient means of building long term customer-seller relationships in the service industry (Jones&McCleary 2009; Botha&Brink 2007). The importance of managing the relationship is further supported through the concept of the interrelationships between human resource management, marketing management and operations management (Canning&Lloyd 2007). To a great extent, relationship marketing owes its popularity to the limitations and shortcomings of traditional marketing (Cater 2007). Instead of building lasting relationships with the existing customers, traditional marketing activities dwell on the processes, transaction and recruitment of new customers (Christopher, Payne&Ballantyne 2008). The main driving force for relationship marketing on the other hand has been the new opportunities made available through information technology including internet integration, electronic commerce, data warehouses and relational warehouses.
Usually, the quality of service to be supplied is determined by market demand and competitive positioning (Golder, Mitra&Moorman 2012; Jen, Lu, Hseieh,Wu&Chan 2013). The size of the potential market on the other hand depends on the degree of domestic and global demand(Golder et al 2012). Nevertheless, the ideal value-added service has a strong relationship with the core product or service, compensates for any weaknesses in the core elements of the package offered and is something that the customers expect and are prepared to reward (Alfadly 2012; Ahmed 2013). While providing opportunities for offering new and enhanced services, technology has today provided tools forproviding existing services in more convenient, accessible andcreative ways (Bejou&Palmer 2012). Technology in this case facilitates basic customer service functions in terms of questions asked and answered, bill-paying, tracking orders and cheque account records, transactions (i.e. retail and business2business) and learning and information seeking (Brink&Berndt 2008).
In their research on quality performance of contractors in Nigeria, Idrus and Sodangi singled out trust as a persuasive concern throughout the marketing process (Idrus&Sonangi 2010). In this case, the orientation of quality is acknowledged by an organizational promise to developing and sustaining core competencies based on the quality offered. Regretfully, whereas value (quality) is a persuasive concern, it remains a theoretical characteristic that has been defined in different ways (Hightower 2010; Khan 2013). It is for instance considered a subset of performance, productivity parameter, conformity and safety and timeliness (Idrus&Sonangi 2010) by different authors. The main functions of service agencies in marketing include offering the competition differentiation, productivity and service quality (Pai&Chry 2013; Schultz, Doerr&Frederiksen 2013). The new competitors in the market have actually focused their services on the line of prices, service delivery in terms of quality and communicative efforts (Alipour&Darabi 2011; Angelova&Zekiri 2011). Trust is important in strategic alliances as it helps organizations to consider the 7Ps of service marketing mix including pricing, process, people, product, promotion, physical evidence and the process (Alipour&Darabi 2011).
In today’s increasingly competitive world market, buyers find themselves presented with choices regarding suppliers and their products (Ahmed 2013; Alias, Roslin&Shariff 2013; Brito 2011). In this important market, the traditional methods of selling that focused on closing the sale (Botha&Brink 2007; Fichtel 2009) have proved inefficient and often counterproductive to the firm’s long-term and sustainable strategies. Today, relationship marketing represents a fundamental transformation from traditional marketing in that relationships shift from adversarial to cooperative and the goals shift from market share to share of customers (Akhtar 2011). Customers must in this case move from a short-lived transaction-orientation to a long-term and long lived relationship building goal (Akbar&Parvez 2009; Akhtar 2011). In the new economy, services will not matter as much as the relationship between the customer and the company (Bon&Mustafa 2013;Ariffin&Aziz 2012).
Ideally, the shift toward relationship selling has today changed both the roles played by the marketers (sales people) and the skills and activities they exercise in carrying out the presented roles (the selling process itself) (Ariffin, Bibon&Abdullah 2011). Today’s more contemporary selling process is embedded within the relationship marketing paradigm (Bon&Mustafa 2013; Basu&Biswas 2012). Consequently, it emphasizes the initiation and fostering of enduring consumer-seller relationships based on value-added benefits and sharedfaith.As noted by Akbar and Parvez, the activities and skills essential for relationship selling can be classified according to their purpose in terms of the initiation, development, and enhancement of the relationships (Akbar&Parvez 2009).
Key Learning
From the ongoing discussion, it is evident that trust is an important issue in strategic alliances. Trust strengthens relationships, boost performance, and productivity. Trust increases customers’ satisfaction, which in turn increases sales and profit growth. Overall, most authors agree that trust increases customer satisfaction, and this increases repeat visits, strategic benefits and positive feedback. With this, most authors conclude that businesses should work hard to increase their consumers’ trust, which further dictates the performance of the business. Businesses parties with strong relationship ties are more likely to flourish in their partnership. With this, business partners should establish a strong relationship based on trust to succeed in the business.
Methodology
The methodology of the study involved a qualitative approach that entailed two case studies that focused how marketing is an effective tool for attaining and keeping the competitive advantage. In this case, semi-structured interviews were conducted to fully explore the antecedent of trust in the strategic alliance. A number of companies involved in strategic alliance were identified and later interviewed. Snowball sampling was used to evaluate the best organizations that presented adequate information of the research. Participants were guaranteed of confidentiality and privacy. With this, most authors were in a better position to collect their information from the survey and fields.
Some data was collected using the survey method; for this reason, most authors explored the important aspects related to antecedent of trust in the strategic alliances. Most of the sources collected provided adequate facts and information of how trust is an important factor that enhance success in the strategic alliance. Most articles provided a comprehensive review of the factors that influences trust in the strategic alliance through case studies. Most researchers acknowledge that successful firms should have a customer-oriented business culture (Brady&Cronin 2009; Hightower&Shariat 2009; Hightower&Florida 2010; Lee 2011). In a research on ‘the modeling correlation between servicescape, self-perception, congruity and loyalty intention of customers toward department stores’ for instance, Alias and his colleagues discovered that servicescape has a significant effect on customers’ loyalty intention. A store can in this case create an effective atmosphere to stimulate customers’ immediate attention. It can also reflect the congruity of customers’ self-image (Alias, Roslin&Shariff 2013).
Future Research and implications
Although the research was deep in content, there few limitations found. For instance, some authors used small sample size to interview. With this, it was difficult to evaluate and generalize the findings of other strategic alliances. With this in mind, this research would recommend future studies to examine the subject in multiple international businesses. This study would recommend many authors to identify more variables that influences trust in strategic alliances. The research would be more comprehensive if it highlighted the factors that facilitate international strategic alliances. For instance, organizations should work hard to recruit managers with knowledge on international networks. Having this knowledge would helped in developing trust, which further would enhance success in the partnership. The research would also evaluate how firms can improve in their communication and exchange information. With this knowledge in mind, most organizations would embrace the recent innovations of technology to succeed in communication and information exchange.
Conclusion
The purpose of this research was to evaluate the effect or result of trust on the performance of the strategic alliance. After a thorough research, this study found that trust is built through various variables such as fairness preservation, inter-firm adaptation, communication and information exchange, and network relationship. Overall, this research has explained the concept of trust through social exchange theory. From the ongoing discussion, this theory highlights that trust is a crucial factors that cannot be underestimated in enhancing growth in strategic alliance. This research has also evaluated that trust boost performance. The main driving force in stratrgic alliances have been the new opportunities made available through information technology including internet integration, electronic commerce, data warehouses and relational warehouses.
The goal for relationship marketing is to identify and create new value with individual customers. Relationship marketing focus more on the marketing elements of product quality, customer sensitivity, customer convenience, price, promotion, place and service. In future, this research would recommend authors in articles to support their facts and information from other sources. This would enhance a deep understanding of the study. Typically, this research utilized qualitative methodology to explore the concept if trust in both international and domestic strategic alliances. In future, this research suggests that authors should conduct their research in multiple companies to collect adequate facts and information of the subject.
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