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Organizational Relationships

While in ongoing relationships the effect of a erson?s trusting tendency declines, in new organizational relationships it is assumed to have a significant effect on trusting beliefs and intentions. Trust as a dichotomy Lewicki, McAllister, and Bies (1998) posit the framework of incorporating trust with distrust. Just as love and hate exist simultaneously in one relationship, trust and distrust also exist in one relationship. Under these conditions trust is limited to specific exchanges, and on other exchanges or facets (i.e., financial but not personal), distrust exists. Opportunities are pursued and risks are monitored. The range of a calculus based trust is often limited to situations where evidence of failure to perform can be obtained in the short term. Risk may entail short term performance losses but not threaten thetrustor?s broader interests (Rousseau et al., 1998).

While the information creating trust and distrust is accumulated at the same time, once trust and distrust are established, there is a dynamic tension between them, reflecting pressure towards homogeneity that facilitates harmonious interaction and coordination. In this trust/distrust framework, relational trust entails both beliefs in the positive intentions of the trustee, and also in the absence of negative intentions giving rise to the condition of high trust/low distrust. Interdependence between the parties to relational trust is likely to increase over time as new opportunities and initiatives are pursued. A dynamic of relational trust is its potential for expansion or contraction, where experiences over time can escalate positive beliefs regarding intentions of the other or conversely, exacerbate negative beliefs (Lewicki et al., 1998; Sitkin & Roth, 1998). Figure 8 presents the integration of trust and distrust.

Conditional and Unconditional trust Jones and George (1998) assume that people act in social situations based on the meanings that they have learned to associate with them, and these meanings are acquired by interactions with other people so that a definition of the social situation is created over time. Thus, in any encounter two parties mutually develop and negotiate a definition of the social situation. People use their values to decide whether or not to trust the other. People decide whether differences in values appear to be so divergent, that they are making themselves vulnerable to the other party.

The point at which two parties have strong confidence in each other?s values and trustworthiness, have favorable attitudes toward each other, and experience positive affect in the context of the relationship, is crucial in the evolution of trust. To distinguish between the experience of trust before and after this point, Jones and George (1998) make a distinction between states of conditional and unconditional trust. Conditional trust is a state of trust in which both parties are willing to transact with each other, as long as: each behaves appropriately, each uses a similar interpretation to the situation, and each can take the role of the other. Attitudes of one party towards the other, are favorable enough to support future interactions. Conditional trust is sufficient to facilitate a wide range of exchanges. It is consistent with knowledge based trust, and with positive expectations of the other.

Unconditional trust characterizes an experience of trust that starts when individuals abandon the pretense of suspending the belief. Because shared values now structure the social situation and become the primary vehicle through which those individuals experience trust. With unconditional trust each party?s trustworthiness is assured based on confidence in the other?s values. Previous repeated interactions created knowledge which is contained in each one?s attitudes. Positive affect increases as positive moods and emotions strengthen the affective bonds between parties, bolstering the experience of trust. Thus, when unconditional trust is present, relationships become significant and often involve a sense of mutual identification (Lewicki & Bunker, 1995; Shapiro et al.,1998).

Institutional Trust Institutional trust refers to organizational and societal factors that support the mass of trust that sustains trust behavior (Gulati, 1995; Ring & Van De Ven, 1992; Sitkin 1995). These may be cultural controls or legal controls that protect individual rights and property. The literature questions whether institutional trust is a control or a form of trust. regardless of the answer to this question, the factors defined as institutional trust serve as a springboard for the creation of trust in the interpersonal level (Hagen & Choe, 1998; Ring, 1998). Institutional controls can also undermine interpersonal trust (Rousseau et al., 1998) where legal mechanisms give rise to rigidity in responses to conflict and substitute high levels of formalization for more flexible conflict management (Sitkin & Bies, 1994). Zucker (1986) also views institutional trust as reducing the opportunity for creating interpersonal trust. The role institutional trust plays in shaping interpersonal trust is yet to be studied. Table 1 presents the foci of researchers in all previous trust studies as presented by Bigley and Pearce (1998).

The Measurement of Trust The common meaning of trust does not imply that all operationalizations of trust reflect the same thing. Inter organizational and interpersonal trust are different because the focal object differs. Lewicki and Bunker (1995) claim that the existing theories regarding the nature and dynamics of trust are fragmented and simplistic. Each discipline assumes its own frame and perspective without articulating the parameters of that frame. Each scholar, therefore, is a blind person describing her or his small piece of the elephant. Mayer, Davis, and Schoorman (1995) support this view claiming that trust research is hindered by a lack of clear differentiation among antecedents and outcomes of trust. Previous trust research concerning general trust (Rotter, 1967) and trust as a social phenomenon (Lewis & Wiegert, 1985), do not clarify the relationships and how to measure them (Mayer & Davis, 1995). Since fundamental elements of the definition of trust are comparable across research and theory, focusing on parties inside and outside companies, researchers can examine trust relationships from the different disciplinary perspectives, with each perspective adopting a different foci.

Trust - a Continuous or a Discrete Variable Intuitively, trust is a continuous variable with different relationships positioned on a continuum of trust. There is evidence however that relational trust is discrete (Sheppard & Sherman, 1998). First, Haslam and Fiske (1992) found evidence for four discrete cognitive structures. Second, encompassed within the psychological contract literature, there is a distinction between two forms of contracts: transactional and relational. Relational contracts, however, involve open - ended relationships. Third, a recent factor analysis of trust scales shows that three of the four allied forms of trust are quite distinct (Lewicki, Stevenson, & Bunker, 1997). Fourth, different disciplines seem to adopt different aspects of trust as their study purview, whereas relationships in reality entail some combination of them all.

Sheppard and Sherman (1998) further claim that this evidence for distinct forms does not imply that trust is entirely discrete. The depth of trust and the level of interdependence across relationships clearly differs and the relationship changes its form. A supplier relationship becomes an integrated design, which becomes an alliance. Thus, although the forms of relational trust are discrete, Sheppard and Sherman (1998) claim that they are also highly linked. One form serves as the building block for the other creating relationships that have different bandwidth of trust.

Social psychologists often see trust as either/or, where one person completely trusts or distrust another (Gabarro, 1990). This static view of trust is related to the predominance in early trust research of laboratory studies which focused on highly structured games (i.e., the prisoner?s dilemma). Under such conditions, the level of trust reflects a single point, rather than a distribution along a continuum. The fact that trust changes over time, from developing to building to declining, in long term relationships indicates that trust is indeed a continuum. Rousseau et al. (1998) contend that scholars do at times focus on multiple phases of trust (Bhattacharya et al., 1998; Bigley & Pearce, 1998; Jones & George, 1998; Lewicki et al., 1998). However, the tendency of authors is to focus upon one stage and to specify a conceptual framework within a particular phase. Rousseau et al. (1998) claim that such an emphasis on phase-specific trust may benecessary at this point in the development of trust scholarship.

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