Coordinating supplier relations: The role of interorganizational trust and interdependence

Various supplier networks consist of many different types of interorganizational relationships. The coordination and evaluation of these kinds of networks is becoming more challenging as the importance and relative power of a single supplier increases due to the centralization of purchases. The main objective of this study is to measure mutual interorganizational trust in the supplier relations of Finnish paper industry. The second objective is to classify suppliers by the type of the relationship into different categories and to illustrate the development of these relationships in order to use these methods to assist main contractor’s supplier coordination.

The case network consists of seven companies operating in the fields of maintenance, engineering and consulting. During the study, the representatives of both the suppliers and the customers were interviewed using a questionnaire made in advance based on earlier literature. The results of the study show that mutual interorganizational trust along with interdependence is a central factor when main contractors choose and coordinate their suppliers in the network economy.