Building interpersonal trust in business networks: enablers and roadblocks

Abstract

Purpose -  This study examines how interpersonal trust forms in business networks and anchors relationships. Trust can be seen as a required factor and enabler for co-creation that is needed when business models are created. This study draws on empirical data from a case study of a Finnish business network in the healthcare and pharmaceutical industries. It seeks to answer the research question: How does interpersonal trust start to develop at the business network level and how it can be supported?

Design/ methodology/approach – This article draws on a case study of a Finnish business network which was developed through theme interviews and observation conducted in 2012.

Findings - The findings support existing research on interpersonal trust, and emphasize three key characteristics of interpersonal trust building: (1) It is a slow process that can be easily discontinued by definite roadblocks. (2) It requires that the parties have knowledge about one another and a rapport; that they show respect and fairness, keep their promises, and most importantly, communicate effectively. (3) It should be based on shared responsibilities among the network members. The key finding is the importance of informal meetings that is not highly noticed in the research field. Informal meetings support more the building of we-spirit and crazy ideas that are important when new business models and innovations are built.

Research limitations/implications – This case study considers one business network in Finland. Further research would be required in order to generalise the findings on a larger scale or to other contexts.

Practical implications – This study is highly practical oriented and it offers practical guidance and support for business partners in the early stages of networking by highlighting the role of trust formation.

Originality/value - Despite the significant attention given to interpersonal trust in management literature, less research has focused on understanding how it forms in inter-organisational settings.  Moreover, the focus is usually in dyadic relations in network studies but this study focus on the level of whole network.

Keywords - Business networks; Business Modelling; Communication; Distrust; Networking; Social Capital; Trust

Article Classification - Case study