• Journal of Global Scholars of Marketing Science
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• v.19 no.4
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• pp.32-43
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• 2009

Trust has been studied extensively in psychology, economics, and sociology, and its importance has been emphasized not only in marketing, but also in business disciplines in general. Unlike past relationships between suppliers and buyers, which take considerable advantage of private networks and may involve unethical business practices, partnerships between suppliers and buyers are at the core of success for industrial marketing amid intense global competition in the 21st century. A high level of mutual cooperation occurs through an exchange relationship based on trust, which brings long-term benefits, competitive enhancements, and transaction cost reductions, among other benefits, for both buyers and suppliers. In spite of the important role of trust, existing studies in buy-supply situations overlook the role of trust and do not systematically analyze the effect of trust on relational performance. Consequently, an in-depth study that determines the relation of trust to the relational performance between buyers and suppliers of business services is absolutely needed. Business services in this study, which include those supporting the manufacturing industry, are drawing attention as the economic growth engine for the next generation. The Korean government has selected business services as a strategic area for the development of manufacturing sectors. Since the demands for opening business services markets are becoming fiercer, the competitiveness of the business service industry must be promoted now more than ever. The purpose of this study is to investigate the effect of the mutual trust between buyers and suppliers on relational performance. Specifically, this study proposed a theoretical model of trust-relational performance in the transactions of business services and empirically tested the hypotheses delineated from the framework. The study suggests strategic implications based on research findings. Empirical data were collected via multiple methods, including via telephone, mail, and in-person interviews. Sample companies were knowledge-based companies supplying and purchasing business services in Korea. The present study collected data on a dyadic basis. Each pair of sample companies includes a buying company and its corresponding supplying company. Mutual trust was traced for each pair of companies. This study proposes a model of trust-relational performance of buying-supplying for business services. The model consists of trust and its antecedents and consequences. The trust of buyers is classified into trust toward the supplying company and trust toward salespersons. Viewing trust both at the individual level and the organizational level is based on the research of Doney and Cannon (1997). Normally, buyers are the subject of trust, but this study supposes that suppliers are the subjects. Hence, it uniquely focused on the bilateral perspective of perceived risk. In other words, suppliers, like buyers, are the subject of trust since transactions are normally bilateral. From this point of view, suppliers' trust in buyers is as important as buyers' trust in suppliers. The suppliers' trust is influenced by the extent to which it trusts the buying companies and the buyers. This classification of trust using an individual level and an organization level is based on the suggestion of Doney and Cannon (1997). Trust affects the process of supplier selection, which works in a bilateral manner. Suppliers are actively involved in the supplier selection process, working very closely with buyers. In addition, the process is affected by the extent to which each party trusts its partners. The selection process consists of certain steps: recognition, information search, supplier selection, and performance evaluation. As a result of the process, both buyers and suppliers evaluate the performance and take corrective actions on the basis of such outcomes as tangible, intangible, and/or side effects. The measurement of trust used for the present study was developed on the basis of the studies of Mayer, Davis and Schoorman (1995) and Mayer and Davis (1999). Based on their recommendations, the three dimensions of trust used for the study include ability, benevolence, and integrity. The original questions were adjusted to the context of the transactions of business services. For example, a question such as "He/she has professional capabilities" has been changed to "The salesperson showed professional capabilities while we talked about our products." The measurement used for this study differs from those used in previous studies (Rotter 1967; Sullivan and Peterson 1982; Dwyer and Oh 1987). The measurements of the antecedents and consequences of trust used for this study were developed on the basis of Doney and Cannon (1997). The original questions were adjusted to the context of transactions in business services. In particular, questions were developed for both buyers and suppliers to address the following factors: reputation (integrity, customer care, good-will), market standing (company size, market share, positioning in the industry), willingness to customize (product, process, delivery), information sharing (proprietary information, private information), willingness to maintain relationships, perceived professionalism, authority empowerment, buyer-seller similarity, and contact frequency. As a consequential variable of trust, relational performance was measured. Relational performance is classified into tangible effects, intangible effects, and side effects. Tangible effects include financial performance; intangible effects include improvements in relations, network developing, and internal employee satisfaction; side effects include those not included either in the tangible or intangible effects. Three hundred fifty pairs of companies were contacted, and one hundred five pairs of companies responded. After deleting five company pairs because of incomplete responses, one hundred five pairs of companies were used for data analysis. The response ratio of the companies used for data analysis is 30% (105/350), which is above the average response ratio in industrial marketing research. As for the characteristics of the respondent companies, the majority of the companies operate service businesses for both buyers (85.4%) and suppliers (81.8%). The majority of buyers (76%) deal with consumer goods, while the majority of suppliers (70%) deal with industrial goods. This may imply that buyers process the incoming material, parts, and components to produce the finished consumer goods. As indicated by their report of the length of acquaintance with their partners, suppliers appear to have longer business relationships than do buyers. Hypothesis 1 tested the effects of buyer-supplier characteristics on trust. The salesperson's professionalism (t=2.070, p<0.05) and authority empowerment (t=2.328, p<0.05) positively affected buyers' trust toward suppliers. On the other hand, authority empowerment (t=2.192, p<0.05) positively affected supplier trust toward buyers. For both buyers and suppliers, the degree of authority empowerment plays a crucial role in the maintenance of their trust in each other. Hypothesis 2 tested the effects of buyerseller relational characteristics on trust. Buyers tend to trust suppliers, as suppliers make every effort to contact buyers (t=2.212, p<0.05). This tendency has also been shown to be much stronger for suppliers (t=2.591, p<0.01). On the other hand suppliers trust buyers because suppliers perceive buyers as being similar to themselves (t=2.702, p<0.01). This finding confirmed the results of Crosby, Evans, and Cowles (1990), which reported that suppliers and buyers build relationships through regular meetings, either for business or personal matters. Hypothesis 3 tested the effects of trust on perceived risk. It has been found that for both suppliers and buyers the lower is the trust, the higher is the perceived risk (t=-6.621, p<0.01 for buyers; t=-2.437, p<0.05). Interestingly, this tendency has been shown to be much stronger for buyers than for suppliers. One possible explanation for this higher level of perceived risk is that buyers normally perceive higher risks than do suppliers in transactions involving business services. For this reason, it is necessary for suppliers to implement risk reduction strategies for buyers. Hypothesis 4 tested the effects of trust on information searching. It has been found that for both suppliers and buyers, contrary to expectation, trust depends on their partner's reputation (t=2.929, p<0.01 for buyers; t=2.711, p<0.05 for suppliers). This finding shows that suppliers with good reputations tend to be trusted. Prior experience did not show any significant relationship with trust for either buyers or suppliers. Hypothesis 5 tested the effects of trust on supplier/buyer selection. Unlike buyers, suppliers tend to trust buyers when they think that previous transactions with buyers were important (t=2.913 p<0.01). However, this study did not show any significant relationship between source loyalty and the trust of buyers in suppliers. Hypothesis 6 tested the effects of trust on relational performances. For buyers and suppliers, financial performance reportedly improved when they trusted their partners (t=2.301, p<0.05 for buyers; t=3.692, p<0.01 for suppliers). It is interesting that this tendency was much stronger for suppliers than it was for buyers. Similarly, competitiveness was reported to improve when buyers and suppliers trusted their partners (t=3.563, p<0.01 for buyers; t=3.042, p<0.01 for suppliers). For suppliers, efficiency and productivity were reportedly improved when they trusted buyers (t=2.673, p<0.01). Other performance indices showed insignificant relationships with trust. The findings of this study have some strategic implications. First and most importantly, trust-based transactions are beneficial for both suppliers and buyers. As verified in the study, financial performance can be improved through efforts to build and maintain mutual trust. Similarly, competitiveness can be increased through the same kinds of effort. Second, trust-based transactions can facilitate the reduction of perceived risks inherent in the purchasing situation. This finding has implications for both suppliers and buyers. It is generally believed that buyers perceive higher risks in a highly involved purchasing situation. To reduce risks, previous studies have recommended that suppliers devise risk-reducing tactics. Moving beyond these recommendations, the present study uniquely focused on the bilateral perspective of perceived risk. In other words, suppliers are also susceptible to perceived risks, especially when they supply services that require very technical and sophisticated manipulations and maintenance. Consequently, buyers and suppliers must solve problems together in close collaboration. Hence, mutual trust plays a crucial role in the problem-solving process. Third, as found in this study, the more authority a salesperson has, the more he or she can be trusted. This finding is very important with regard to tactics. Building trust is a long-term assignment; however, when mutual trust has not been developed, suppliers can overcome the problems they encounter by empowering a salesperson with the authority to make certain decisions. This finding applies to suppliers as well.

• Korean Journal of Agricultural Science
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• v.2 no.1
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• pp.9-47
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• 1975

These experiments were caried out to study the effects of caponization and various hormone treatments upon meat production and improvement of meat quality of growing chicken. Sixtyseven days old 160 New Hampshire cockerels were treated and growth rate, carcass yield, change of weight of individual organs, meat composition and change of amino acid were measured and analysed. Otherwise change of testis and thyroid gland by hormone treatment were investigated histologically. The results obtained were as follows. 1. The effectst of caponization and hormone treatment upon meat production were; 1) Body weight of cockerels in D. E. S. group without caponization was increased. upon 96.86% than initial period and A. C. T. H. group was 104.22% but other groups and all carponization groups were lighter than those of control group. 2) Weekly body gain of D. E. S. group without caponization was best showing the significance (102.69 g) and the group with caponization were lower than those groups without caponization. 3) Carcass yield was best in Testo. group without caponization (831.2 g) and the group with caponization were lower than the group without caponization. 4) Carcass rate was highest in A. C. T. H. group with caponization and (67.22%) lowest in Testo. group without caponization (63.37%), but any significance was not recognized. 2. The effects of caponizatitn and hormone treatments upon the coposition of meat and amino acids were; 1) Any significance was not recognized between treated and untreated group about change of moisture, crude protein, crude ash and glycogen contents in meat. 2) Fat co tent in muscle in the all treated groups were higher than that of control group. 3) Extracts of group without caponization were higher than those of groups with caponization. 4) Lysin contents were highest in D. E. S. group with caponization (11. 12/ 16.0 g N) and generelly Testo. group was lower compared with D. E. S. group. 5) Histidine and Arginine contents were higher in the groups with caponization than without caponization. 6) Aspartic acid content were higher in D. E. S. group and A. C. T. H. group without depend on caponization. 7) Treonine content was higher in Testo. group without caponization and in the group with caponization and without hormone treatment compared with those of control group without caponization. 8) Serine content was decreased in the group with caponization and increased by D. E. S. and A. C. T. H treatment groups and glutamic acid was also decreased in Testo. group with out caponization. 9) Cystine content was decreased by Testo. treatment and was not appeared in Testo. group without caponization. 10) Valine content was lower in control group with caponization but significance was not recognized between other groups and control group without caponization. 11) Glycine, Alanine, Methionine. Isoleucine, Leucine, Thyrosine and Phenylalanine contents were not so difference between hormone treated groups and control group without caponization. 3. The effects of caponization and hormone treatment upon the change of organs were: 1) The weight of all organs were heaviest in D. E. S. group without caponization (18.5g) and lightest in A. C. T. H. group without caponization (155. 3g) but no significance was recognized between hormone treatment groups. 2) Heart weight was heaviest in D. E. S. group without caponization (7.46 g) and lightest in Testo. group without caponization (5.95 g). 3) Liver weight was heaviest in D. E. S. group without caponization(32.89g) and lightest in hormone untreated group with caponization(29.66g). Significance was not recognized. 4) Spleen weight was heaivest in Testo. group with caponization (3.22 g) and lightest in D. E. S. group without caponization(2.00g) in contrast with the other groups. High significance was recognized among the groups (P<0.01). 5) Cloacal thymus weight was lightest in D. E. S. group with or without caponization compared with control group without caponization. High significance was recognized among the groups. 6) Muscle fat content was not appeared in A. C. T. H. group with caponization, but it was highly increased in D. E. S. group with or without caponization. 7) Testis weight was lightest in D. E. S. group (0.38g) compared with control group (2.66g). Significance was recognized among the groups. 8) Large intestine, small intestine and cecum weight and length were heavier and longer in D. E. S. group without caponization and control group without caponization was lighter than those of hormone treated groups. 4. The effects of caponization and hormone treatment upon histological change of testis and thyroid gland: 1) The histological change of testis was significantly appeared in D. E. S. group that seminifirous tubles was slowly atrophied, the funtion of spernatogenesis was ceased, spermatocyte was changed as degeneration by pyknosis and karyorrhexis and interstitial cell was also atrophied, but in Testo. and A. C. T. H. group were similar as control group. 2) The histological change of thyroid gland in Testo. and A. C. T. H. groups without caponization were similar to that of control group without caponization, but in D. E. S. group without caponization, was changed squamously. Thyroid gland of the groups with caponization, epithelium of was atrophied and changed squamously as degeneration by pyknosis and karyorrhexis and the function of thyroid gland was slowly ceased in colloid and in hormone treated group with caponization.