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Decision model with quantification of buyer-supplier trust in advanced technology enterprises

Zachary A. Collier (Department of Management, Radford University, Radford, Virginia, USA)
Ujjwal Guin (Department of Electrical and Computer Engineering, Auburn University, Auburn, Alabama, USA)
Joseph Sarkis (Foisie Business School, Worcester Polytechnic Institute, Worcester, Massachusetts, USA) (Hanken School of Economics, Humlog Institute, Helsinki, Finland)
James H. Lambert (Department of Engineering Systems and Environment, University of Virginia, Charlottesville, Virginia, USA)

Benchmarking: An International Journal

ISSN: 1463-5771

Article publication date: 9 December 2021

Issue publication date: 29 November 2022

187

Abstract

Purpose

In the buyer-supplier relationship of a high-technology enterprise, the concepts of trust and risk are closely intertwined. Entering into a buyer-supplier relationship inherently involves a degree of risk, since there is always an opportunity for one of the parties to act opportunistically. Purchasing and supply managers play an important role in reducing the firm's risk profile, and must make decisions about whether or not to enter into, or remain in, a relationship with a supplier based on a subjective assessment of trust and risk.

Design/methodology/approach

In this paper, the authors seek to explore how trust in the buyer-supplier relationship can be quantitatively modeled in the presence of risk. The authors develop a model of trust between a buyer and supplier as a risk-based decision, in which a buyer decides to place trust in a supplier, who may either act cooperatively or opportunistically. The authors use a case study of intellectual property (IP) piracy in the electronics industry to illustrate the conceptual discussion and model development.

Findings

The authors produce a generalizable model that can be used to aid in decision-making and risk analysis for potential supply-chain partnerships, and is both a theoretical and practical innovation. However, the model can benefit a variety of high-technology enterprises.

Originality/value

While the topic of trust is widely discussed, few studies have attempted to derive a quantitative model to support trust-based decision making. This paper advanced the field of supply chain management by developing a model which relates risk and trust in the buyer-supplier relationship.

Keywords

Acknowledgements

This work was supported in part by the National Science Foundation under Grant 1916760 “Phase I IUCRC University of Virginia: Center for Hardware and Embedded System Security and Trust (CHEST)”, and in part by the Commonwealth Center for Advanced Logistics Systems (CCALS) and by Systems Planning & Analysis Inc. (SPA).

Citation

Collier, Z.A., Guin, U., Sarkis, J. and Lambert, J.H. (2022), "Decision model with quantification of buyer-supplier trust in advanced technology enterprises", Benchmarking: An International Journal, Vol. 29 No. 10, pp. 3033-3056. https://doi.org/10.1108/BIJ-06-2021-0336

Publisher

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Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

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