Power and trust in supply chain collaboration: a conceptual framework

Fierce competition in the era of globalization requires firms to develop collaborative capabilities for creating competitive advantage which brings benefits to all participating members. Most of previous research has shown the role of power and trust for creating mutual competitive advantage in inteifzrm relationships. However, there is little attention paid to the influence of power in the creation and appropriation of values in a supply chain. As a cooperative strategy, supply chaincollaboration facilitates chain members to pool their capabilities to create value for customers as well as to retain value for themselves. Very often chain members exercise power in an opportunistic way to appropriate value for themselves rather than creating better value for customers and other stakeholders. This situation prevents chain members from building trust towards one another and discourages them to work for value creation. In this paper, we explore the roles of power and trust in supply chain collaboration from the perspective of network and economic theories. The methodology used in this study is to synthesize the concepts from existing literature with those developed by us to propose a new conceptual framework. This proposed framework will be based on a theoretical approach which acknowledges the interplay between power and trust in the process of value creation and appropriation. We also consider the imbalance of power among the participants in the interaction of interaction mechanisms. Propositions are drawn from the conceptual model to explain the interplay between power, trust, interaction mechanisms, value creation, and value appropriation in collaborative relationships