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The Impact of Trust Bridges on Business
by Prof. Michael R. Czinkota
2015-01-12 12:20:49
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The Impact of Trust Bridges on Business
Michael R. Czinkota and Courtlyn Cook*

Trust bridges are increasingly emphasized in business relations and partnerships. They not only help to fight corruption, but also establish a sense of community that binds people together. Corruption continues to be a hot issue in business and is more prevalent than most people acknowledge.

The baseline standard of corruption, defined by the non-profit Transparency International, is an “abuse of entrusted power for private gain”.  The group sees corruption as the pursuit of selfish, individual gains and the desire to get ahead. Of course, corruption is an individual, as well as a corporate choice. Transparency International’s latest study reports that 25% of people used a bribe in the past year, which means that corruption infiltrates a significant portion of business transactions, which is crucial to take into consideration.

Corruption interrupts corporate culture because it destroys previously established trust that has been earned on a long-term basis. Trust is a valuable corporate asset since it typically translates into fulfilled expectations, which allow for better forecasts, less uncertainty in the future, and more realism.

Trust bridges, developed by shared expectations and experiences, allow people to get to know each other quicker, and help establish fair business practices on global terms. Thus, trust is one of the best ways to combat corruption. Connections that bring people together and lead to greater trust can be built upon a shared alma mater, military service, same work experience, sports fans for the same team, and even practicing the same religion. People are more likely to bond over these personal preferences and organizations because they already share a similar interest; therefore they expect to share similar values.

If two companies operate in similar environments and share values, they are more likely to connect and establish warm and trusting relationships. This ultimately establishes credibility and allows business to select patterns based on trust rather than strictly on proximity or financial measures. Trust is developed through interaction, although there are other spillover effects that come into play. An example would be two organizations that are led by former sports champions might be more likely to trust each other, particularly when it comes to sports. This may also connote, but does not necessarily require trust in financial matters.

It is important to note that trust is an extension of confidence, so high expectations often accompany trust. One such trust enhancing activity is especially present in the German model for developing trust, which due to its reliance on standardized training and internships, focuses on keeping processes flowing due to confidence in and reliance on other’s work. In contrast, less training in the US often leads to a lack of trust and little confidence in work. Therefore trust bridges may not as visible in the American corporate world.

Political connections often have a greater impact on communities that experience very little corruption. This means that people are not relying on bribes or other forms of under the table compensation to make business and personal decisions. Also, this may partially explain research on municipalities, which found that established trust bridges led to government growth and increased profitability of firms.

Relationships that are rooted in trust discourage people from engaging in dishonest behavior. One can therefore argue that corruption inhibits the foundation of relationships. When discovered, corruption can ruin a reputation. Once trust bridges are destroyed, they are difficult to rebuild.

In today’s global economy that is ruled by rapid, if not constant, communication and connection through technology, global trust standards can converge where people hold each other to the same standards. This makes international business easier because it reduces the necessity of local standards, which often results in greater costs for companies since they have to meet different standards in every country of operation.

If a global standard were in place, every country would more likely partake in international business interactions, and therefore would have a better chance of establishing trust bridges. Additionally, companies and managers making crucial decisions based on current trust bridges need to exercise less oversight. All this translates into more effective and efficient use of resources. Thus, trust bridges not only reduce the likelihood of corruption, but also lead to more efficient and profitable business transactions.


 *- Michael Czinkota teaches international business at Georgetown University in Washington D.C. Courtlyn Cook is an undergraduate student at Georgetown, working on a degree in international business.

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Emanuel Paparella2015-01-12 17:28:50
Global trust + global commerce = global peace and prosperity. It sounds wonderful, almost a faith (trust in the future translates the word faith--amor-in Hebrew), but I remain skeptical. Like Plato I believe that trust is not a penultimate goal to the good life understood as the consumerist life based on markets) but it is the ultimate goal based on a concept of the good life understood as the authentic life based on what it means to be human, and out of which material prosperity is a side or penultimate effect. Which is to say: the cultivation of the soul is primary and the health of the body and wealth is secondary.

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