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Relational asymmetry, trust, and innovation in supply chain management: a non-linear approach

Abstract:

Purpose: The purpose of this paper is to examine the non-linear aspects of the asymmetry-performance relationship under varying conditions of trust and innovation. Its novel approach is useful for addressing the strategic elements of supply chain management (SCM) relationships based on trust and innovation decisions. Design/methodology/approach: Results are based on a study of 90 managers from small- and medium-sized firms in Spain. Instead of a classical linear relationship analysis, the authors performed a non-linear analysis, using polynomial modeling and Warp 3 partial least squares method, which provides a more nuanced view of the data and constitutes an original approach to empirical research in SCM. Findings: This study adds a new viewpoint on SC relationships by suggesting that not all trust and innovation development leads directly to performance improvement. The principal finding is, in varying trust and innovation contexts, that the influences of asymmetry on performance have uneven characteristics and follow non-linear paths. Research limitations/implications: This study focuses on only one particular institutional environment in one country. The data are also cross-sectional, which makes it difficult to empirically test causality. Practical implications: The findings provide rational insights to managers on when it is appropriate to reduce (or not) asymmetric relationships with partners. Originality/value: Trust and innovation are important and ones of the key requirements of supply chain relationships in any environment, this study argues that the interactions of key SCM elements that drive members to better performance are more complex and non-linear.