Trust in inter-organizational exchanges: a case study in business to business electronic commerce

Given the uncertainties of online transactions, e-commerce encourages the creation of institutional structures for online exchange relationships. Building upon the notion of institutional trust, this research examines how institutional structures develop through governance mechanisms leading to technology trust derived from structural assurances for online dyadic relationships. Technology trust is defined as the subjective probability by which organizations believe that the underlying technology infrastructure is capable of facilitating transactions according to their confident expectations. Using a cognitive process framework, we discuss four perspectives of trust, namely technological, economic, behavioral, and organizational perspectives, to show how technology trust evolves into relationship trust. We examine the impact of technology trust within an inter-organizational dyad between Cisco and Compaq. The findings posit that technology trust contributes and evolves into relationship trust. The study provides evidence on how specific structural assurances in Cisco Connection Online help to build initial online technology trust in B2B marketplaces that in turn promotes relationship trust and builds trustworthy e-commerce relationships. The paper discusses theoretical and managerial implications of this study, while proposing suggestions for future research. (c) 2004 Published by Elsevier B.V.