Theoretical implications

A major contribution of this paper is the conceptual linkage between trust and electronically mediated exchange. To some extent, this finding is similar to the roles played by trust and contracts in establishing the "rules of engagement" between supply-chain partners. That is, the two mechanisms act in parallel to lend support to the other in establishing closer ties among alliance partners (e.g. Das and Teng, 1998). This paper also answers the call for research on how the transactional type involved supply-chain relationships impacts the value and relative effectiveness of electronically mediated exchange (Ryssel et al., 2004).

In the present context, trust has been shown to particularly influence the level of collaboration among supply-chain partners when the purchase is complex, more specialized, and tailored. Yet, it alone cannot sustain the level of collaboration and it is complemented by electronically mediated exchange that seems to contribute to the relationship by strengthening the bonds through the ongoing exchange of information and constant contact that EDI, for example, provides. This joint impact of trust and electronically mediated exchange re-enforces the relationship and seems to create a greater semblance of interdependence and embeddedness (Provan, 1993).

When the product is a standardized, off-the-shelf type of purchase, the depth of the relationship is less critical since normal market mechanisms will partly guide the interaction between partners. Thus, trust takes a lesser role in managing the relationship and electronically mediated exchange becomes important in managing the workflow of the

transaction. Workflow coordination is critical for such commodity-like and often high-volume exchange supply-chain relationships and contributes to higher degrees of collaboration.

Our finding that transactional type indeed does determine the relative effectiveness of trust and electronically mediated exchange in achieving collaboration indicates that the best approach to develop collaborative supply-chain partnerships depends on the context. This is an interesting finding which can encourage more research into the effect of contextual factors other than transactional type in determining the relative effectiveness of various approaches to achieve collaborative supply-chain partnerships.

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