The Coevolution of Trust, Control, and Learning in Joint Ventures

Abstract

T his article examines the evolution of trust, control, and learning in a joint venture relationship. Using a coevolutionary approach, we develop a framework that shows how initial joint venture conditions give way to evolved conditions as joint venture partners develop an understanding of each other and adjust the collaborative process. We explore the relationship between trust and control in joint ventures and identify how these two critical concepts impact joint venture processes. We argue that trust, along with partner collaborative objectives, creates the initial climate that shapes partner interactions. In turn, these interactions lead to subsequent decisions about the nature of controls. We then examine linkages between alliance learning and the trust and control concepts, and argue that learning processes are central to evolving joint venture dynamics. Once the joint venture is formed, and if the initial conditions support continued collaboration, then learning processes will be central to evolving alliance dynamics. As initial conditions give way to evolved conditions, learning and trust will coevolve and impact decisions about control. Propositions linking the concepts are provided as guides for future empirical research.

Cooperative learning in creating and managing joint ventures

“…In contrast, negative perceptions surrounding the negative or non-cooperative behaviour of the partners can destroy this trust. If trust is not developed, it can lead partners to act defensively and can even result in the termination of potential alliances (Das & Teng, 1998), therefore, control measures are put in place (Inkpen & Currall, 2004;Sánchez, Vélez & Ramón-Jerónimo, 2012) in order to minimise the risk of opportunist behaviour.…”

“…According to Inkpen and Currall (2004), when partners create a joint venture and the initial conditions enable continuing cooperation, trust between partners develops. Therefore, past actions generate trust and this trust provides information depending on the level of commitment between the partners (Kumar & Nti, 1998).…”

Trust, control and knowledge transfer in small business networks

“…Research highlights that control and trust affect each other, since control influences the level of trust within a network and trust may impact on the functioning of control (Strätling et al 2013;Bachman 2001;Sengün and Wasti 2009;Inkpen and Currall 2003).…”

Mode Combinations and International Operations

“…However, across the range of mode combination activity by the companies, there was considerable variation, indicating a mixture of inertia and learning in mode development processes -in line with evolutionary explanations of company strategy and organisational development (Barnett and Burgelman, 1996;Doz, 1996;Inkpen and Currall, 2004;Lewin and Volberda, 1999). Such approaches offer scope for theoretical development that incorporates the results of this study and more generally the expanded set of ideas around mode evolution rather than mode replacement.…”