A Relational Perspective on the Contract-Control-Trust Nexus in an Interfirm Relationship

Posted: 19 Jul 2016

See all articles by Reinald A. Minnaar

Reinald A. Minnaar

Nyenrode Business Universiteit

Ed G. J. Vosselman

Radboud University Nijmegen

Paula van Veen-Dirks

University of Groningen - Faculty of Economics and Business

Muhammad Kaleem Zahir-ul-Hassan

Massey University- School of Accountancy

Date Written: May 25, 2016

Abstract

This paper makes sense of the contract-control-trust nexus in interfirm relationships by exposing the performativity of a contract and its incorporated control structures in generating trust. In our study of an outsourcing relationship between Semorg (an international manufacturer of semi-conductors) and Fasorg (the provider of facility management services), we find that trust is interactively related to control in complex and often unpredictable ways rather than in linear ways that result from managerial decision-making. In the network of associations that constitutes the interfirm relationship, trust is not a stable solution that generates predictability, but a quasi-actor that is made to act by the contract and the incorporated control structures. As a quasi-actor, trust is fluent and performative. Once in existence, it mobilises human actors and shapes the relationship. Thus, from a relational perspective trust is a possible and to a large extent unpredictable network effect. This differs from the rational perspective in which trust is an expectation that (in multiple categories) straightforwardly emerges and develops from managerial decisions.

Keywords: trust, contracts, control, relational perspective, performativity

JEL Classification: M4

Suggested Citation

Minnaar, Reinald A. and Vosselman, Ed G. J. and van Veen-Dirks, Paula and Zahir-ul-Hassan, Muhammad Kaleem, A Relational Perspective on the Contract-Control-Trust Nexus in an Interfirm Relationship (May 25, 2016). Management Accounting Research, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2811103

Reinald A. Minnaar (Contact Author)

Nyenrode Business Universiteit ( email )

Straatweg 25
P.O. Box 130
Breukelen, 3620 AC
Netherlands

Ed G. J. Vosselman

Radboud University Nijmegen ( email )

Thomas van Aquinostraat 3
P.O. Box 9108
Nijmegen, 6500HK
Netherlands

Paula Van Veen-Dirks

University of Groningen - Faculty of Economics and Business ( email )

Postbus 72
9700 AB Groningen
Netherlands

Muhammad Kaleem Zahir-ul-Hassan

Massey University- School of Accountancy ( email )

Palmerston North
New Zealand
+6469519095 (Phone)

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