Relationship between trust and cooperation: an empirical study of inter-organisational relationships in Vietnam

The empirical study was conducted and used correlation and regression analysis to examine how cognitive trust and affective trust were associated with cooperation through the[r]

VIETNAM NATIONAL UNIVERSITY, HANOI VIETNAM JAPAN UNIVERSITY

-

NGUYEN NGOC CUONG

RELATIONSHIP BETWEEN TRUST AND COOPERATION: AN EMPIRICAL STUDY

OF INTER-ORGANIZATIONAL RELATIONSHIPS

IN VIETNAM

MASTER'S THESIS

VIETNAM NATIONAL UNIVERSITY, HANOI VIETNAM JAPAN UNIVERSITY

-

NGUYEN NGOC CUONG

RELATIONSHIP BETWEEN TRUST AND COOPERATION: AN EMPIRICAL STUDY

OF INTER-ORGANIZATIONAL RELATIONSHIPS

IN VIETNAM

MAJOR: BUSINESS ADMINISTRATION CODE: 8340101.1

RESEARCH SUPERVISORS:

TABLE OF CONTENTS

LIST OF TABLES iii

LIST OF FIGURES iv

LIST OF ABBREVIATIONS v

ACKNOWLEDGEMENT vi

ABSTRACT vii

CHAPTER 1: INTRODUCTION

1.1 Practical issues

1.2 Theoretical gap and research objective

CHAPTER 2: LITERATURE REVIEW

2.1 Trust

2.2 Relationship commitment

2.3 Cooperation

2.4 Theoretical gap

2.5 Hypothesis formulation

2.6 Research model 10

CHAPTER 3: METHODOLOGY AND DATA COLLECTION 11

3.1 Research scope 11

3.2 Research design 11

3.3 Research scales 12

3.4 Process of collecting data 13

3.5 Characteristics of respondents 14

3.6 Descriptive statistics analysis 17

CHAPTER 4: DATA ANALYSIS AND DISCUSSION 23

4.1 Exploratory factor analysis of CT and AT 23

4.2 Correlation coefficients analysis 24

4.3 Regression analysis 26

4.3.1 Regression with AT as dependent variable 26

4.3.2 Regression with RC as dependent variable 27

4.3.3 Regression with COO as dependent variable 29

4.4 Discussion 32

CHAPTER 5: CONCLUSION 35

5.1 Theoretical contributions 35

5.2 Managerial implications 36

5.3 Limitations and recommendations 37

REFERENCES 39

APPENDIXES 45

APPENDIX 1: ITEMS IN MEASUREMENT SCALES 45

LIST OF TABLES

Table 3.1 Demographic characteristic of respondents 14

Table 3.2 Mean and standard deviation 17

Table 3.3 Cronbach’s Alpha 20

Table 4.1 EFA of CT and AT 23

Table 4.2 Transforming representative factors 24

Table 4.3 Correlation coefficients Matrix Analysis 25

Table 4.4 Regression with AT as dependent variable 26

Table 4.5 Regression with RC as dependent variable (CT is predictor) 27

Table 4.6 Regression with RC as dependent variable (AT is predictor) 28

Table 4.7 Regression with COO as dependent variable (RC is predictor) 29

Table 4.8 Regression with COO as dependent variable (CT is predictor) 30

Table 4.9 Regression with COO as dependent variable (AT is predictor) 31

LIST OF FIGURES

LIST OF ABBREVIATIONS

AT Affective trust

COO Cooperation

CT Cognitive trust

EFA Exploratory factor analysis

ACKNOWLEDGEMENT

Firstly, I would like to express deepest gratitude to my parents, who always respect my decisions and support me for what I have committed Their belief and supports have made my confidence to face challenges and move forward

Likewise, I am grateful to my supervisors Associate Professor Kodo Yokozawa and Associate Professor Vu Anh Dung for making this research project possible Associate Professor Kodo Yokozawa has been kindly, patiently and enthusiastically accompanied and facilitated me in the process of researching from the idea formation to every step on how to a good scientific research Whilst, Associate Professor Vu Anh Dung critically evaluated the matters and logically explained the reasons of my research His advices helped me recognize the limitations and learnt to improve them in the research Thanks to my supervisors, my knowledge in the academic research has been truly enriched

I am also thankful to all experts, lecturers and staffs from Japan International Cooperation Agency (JICA), Vietnam National University (VNU), Yokohama National University (YNU), Vietnam Japan University (VNU), Waseda University as well as those, who participated in the questionnaire survey Thanks to all of you, I really had a memorable and enjoyable time during my post graduate study

Last but not least, I would like to send a special thank you to Dr Yoshifumi Hino I sincerely appreciated and enjoyed the time and the process of learning quantitative research, economics and Japanese language from him

ABSTRACT

CHAPTER 1: INTRODUCTION

1.1 Practical issues

Cooperation played crucial roles in business practices since it can promote relational exchanges, effective competitions, enhances a flow of information and business transaction (Morgan & Hunt, 1994) Despite its important roles and benefits, business practicers find it challenging to achieve effective cooperation in Vietnam

The characteristics of the environment here was described with some frequencies of one time deal approach, inadequacy of company profile data the shortage of proper procedures, or the absence of developed infrastructures (Nguyen & Rose, 2009) It is quite common to experience the late time of product delivery, the unqualified product quality or the lack of delivering professional customer services from the suppliers here All of these caused difficulties for focal firms to foster relationships with the suppliers to achieve shared goals and have motivations to maintain the exchanged relationships Thus, this research is motivated to find out the key for effective cooperation to be applied in Vietnamese business practices

1.2 Theoretical gap and research objective

In the theory, the direct relationship of trust on cooperation in an emerging economy is questionable The inter-organizational trust was researched for over decades (Seppänen, Blomqvist, & Sundqvist, 2007) but was mainly studied in the developed economies (e.g., Morgan & Hunt, 1994; Zineldin & Jonsson, 2000; Abosag, Tynan, & Lewis, 2006) Thus, there was currently insufficient study of the relationship between trust and cooperation in the emerging market economies, where the researcher believed in the less impacts of trust on cooperation as it influenced in the developed economies

CHAPTER 2: LITERATURE REVIEW

2.1 Trust

The literature surveyed on interorganizational trust, highlighted the primary conceptualization of trust as confidence, belief, willingness or expectation on exchange partners to fulfil their obligations (Zaheer & Harris, 2005); however, later studies showed a lack of consistent agreements for the appropriate conceptualization and operationalization in the trust context (Abosag et al., 2006; Seppänen et al., 2007)

This research shared the perspective with one of the most cited theories on the context of interorganizational trust from Morgan and Hunt (1994), who argued the redundancy of willingness in trust definition and indicated importantly the confidence; therefore, trust was redefined persuasively as the confidence in the reliability and integrity from the partners that the focal firm exchange with (Morgan & Hunt, 1994) Later studies were also persuaded with the conceptualization of confidence and be applied in interorganizational cooperation (Dyer & Chu, 2000) or industrial marketing relationships (Cooote, Forrest & Tam, 2003)

Accordingly, cognitive trust is the confidence, which is founded on the knowledge of the party’s performance and capabilities This critical thinking is necessary to reduce the uncertain behaviors due to some degree of risk on the party’s behavior in the future (Eriksson & Sharma, 2003); therefore, strengthening the relationships with their exchange partners Whilst, the affection trust is the confidence, which is based on the natural feeling from the experience of receiving caring or concerns in transaction processes with exchanged parties (e.g., Lewis & Weigert, 1985; McAllister, 1995; Mo ̈llering, 2002; Johnson & Grayson, 2005) This emotional trust is motivated by the partners’ goodwill (Ring & Van de ven, 1994) and shared values (Morgan & Hunt, 1994); which showed the willingness and quality of interaction in promoting the relationships

2.2 Relationship commitment

Similar to trust, relationship commitment has been seen in different disciplinary to have a central position in developing sustainable relationships (Abosag et al., 2006) It was not forced but earned, which revealed the willingness or intention to maintain in a long-term process rather than short-term alternatives (Zineldin & Jonsson, 2000)

This definition corresponds closely with the development of Morrman, Deshpande and Zaltman (1993, p.316) as the “enduring desire to maintain a valued relationship” and the conceptualization of Morgan and Hunt (1994) as a belief the relationship is worthy to endure sustainably and be willing to maximize the efforts on maintaining

2.3 Cooperation

Cooperation was defined as the situation which exchange partners worked together to achieve mutual goals (Anderson & Narus, 1990; Skinner, Gassenheimer, & Kelley, 1992) Morgan and Hunt (1994) highlighted that the effective cooperation could promote an effective competition within network and enhance the success of the relationship marketing Previous research on interorganizational study also emphasized the importance to understand how to develop and maintain cooperation to acquire sustainable satisfying relationships (Childers & Ruekert, 1982) Later, cooperation has been viewed with the temporary conflicts within the process (Frazier, 1983; Morgan & Hunt, 1994)

2.4 Theoretical gap

The practical roles and benefits of inter-organizational trust continuously fascinated the study by various scholars and business practicers Trust was considered as a primary source of sustainable competitive advantage as well as the main factor to improve the organization’s business capacity (e.g., Barney & Hansen, 1994; Seppänen et al., 2007) Nevertheless, trust facilitated information exchanges, cooperative behaviors and reduced costs of transaction and relationship conflicts (Nguyen, Babar, & Verner, 2006)

(Morgan & Hunt, 1994) In the interorganizational level, the research primarily focused on the relationships between buyers and sellers, business and business, suppliers and manufacturers (Seppänen et al., 2007)

Despite its important roles and benefits, the nature of trust makes it risky in trusting their partners due to the possibility of uncertain anticipation for the party to behave opportunistically (Zaheer, McEvily, & Perrone, 1998; Dominique, 2012) The degree of freedom to disappoint the relationship’s expectation are still possible (Gambetta, 2000; Abosag et al., 2006) and makes it challenging for the exchange partners to assess this occurrence (Hosmer, 1995)

Together with the natural risk of trust itself, the risk for investments are even higher in the emerging economies The emerging nations are still in the process of industrialization and modernization; therefore, the lack of advanced infrastructures or the consistency in accounting or financial information will cause it riskier to business in the emerging markets rather than in other developed economy nations That is to say, the higher risks in the in the emerging markets might limit the effect of trust on cooperation even though primary studies of trust and cooperation in developed economies showed the supported direct relationship of trust and cooperation in their nations (Morgan & Hunt, 1994; Zineldin & Jonsson, 2000; Abosag et al., 2006) This belief was also strengthened since Glaser-Segura (1998) statistically discovered the unsupported interorganizational trust and interorganizational cooperation Mexico

2.5 Hypothesis formulation

In this section, six hypothesizes have been formed to address the research questions

Hypothesis 1: Cognitive trust positively influences affective trust

There was occurrence of bidirectional causal effect between cognitive trust and affective trust since cognitive trust firstly occurred and became the base for developing affective trust but when affective trust developed to a certain level, reverse causal direction might occur (McAllister, 1995) However, that mature level involved with risk as it based on emotion rather than knowledge of partners’ business performance, therefore, it was more natural to see the initial development of cognitive trust for secure and its influence on affective trust For instance, having a belief in the suppliers’ actual performance could open the committed partners in sharing information actively and openly

This direction, therefore, was made on hypothesis one, which was also consistent with the proven dependence of affective trust on cognitive trust in an organizational level (McAllister, 1995) In the interorganizational relationship, the direct impact of cognitive trust on affective trust was also confirmed in relationship marketing (Morgan & Hunt, 1994); financial consulting environment (Johnson & Grayson, 2005), international trading (Zur, Leckie & Webster, 2012) or information technology service (Scott, 2000; Park et al., 2013)

Hypothesis 2: Cognitive trust positively influences relationship commitment Hypothesis 3: Affective trust positively influences relationship commitment

commitment in the relational exchange The causal relationship from trust to relationship commitment was also determined by a variety of authors in interorganizational level (Zineldin & Jonsson, 2000; Abosag et al., 2006; Park et al., 2013; Jeong & Oh, 2017; Wang, Tajvidi, Lin & Hajli, 2019; Cui, Mou, Cohen, Liu & Kurcz, 2020)

Hypothesis 4: Relationship commitment positively influences cooperation

The hypothesis four was formulated To make the relationship work properly and efficiently, a partner who is committed to the exchange relations will cooperate with others (Morgan & Hunt, 1994) Similarly, both theories and empirical research has proven this relationship and found the significant influence of relationship commitment on cooperation in various contexts (Zineldin & Jonsson, 2000; Abosag et al., 2006; Park et al., 2013)

Hypothesis 5: Cognitive trust positively influences cooperation Hypothesis 6: Affective trust positively influences cooperation

partner The direction was also consistent with other studies in cross-national contexts (e.g., Abosag et al 2006; Martins, Faria, Prearo, & Arruda, 2016)

2.6 Research model

From the above hypothesizes, a conceptual model was proposed to investigate the relationship between trust and cooperation with mediating variable as relationship commitment (Figure 2.1)

CHAPTER 3: METHODOLOGY AND DATA COLLECTION

3.1 Research scope

Vietnam was selected for its relevance with the phenomenon of the research The country was one of the most vibrant emerging market economies in East Asia region (Worldbank, 2019) Despite the challenges that committed suppliers might neither have sufficient competence performance nor enthusiastic attitude to cooperate for long-term relationship developments, this prospective nation has still attracted an increasing number of foreign direct investments with numerous opportunities

Since it is highly valuable to measure how trust was perceived for the measurement of these interorganizational levels (Mo ̈llering, 2002), this would investigate the perception from the focal firms or non-governmental organizations that purchased, partnered or consumed the products and services from their exchanged suppliers

3.2 Research design

The quantitative research was implemented to examine the conceptual model with collected data through online questionnaire survey

To increase the effectiveness of carrying out survey, the questionnaire was discussed and reviewed by the supervisors Then, pilot questionnaire was sent to several readers who had capabilities for evaluation and correction This research also provided the simple definition of what suppliers were so that the readers could understand better Since the targeted respondents are Vietnamese, a translation into Vietnamese was made for assessment To increase the correctness of the translation, reversed-translation has been done and bilingual languages have been adapted, in which both original English version and Vietnamese translation were made for the readers’ comparison

The questionnaires were constructed to aim at those, who were responsible, represented or being involved in the organizational process of making organizational decisions to deal with their major suppliers To make the judgement, it was important for the respondents to have certain experiences in the field; therefore, this research targeted responders, who had at least three years of relevant experiences, hold the position as senior staff, supervisor, manager or business owner

3.3 Research scales

Hypothesis testing depended highly on the solid construct measurement (Bacharach, 1989); therefore, this research critically considered the measure that was consistent and relevant with the conceptualization, met the standard of empirical research and importantly could capture the respondents’ objective perspective on evaluating their suppliers from the organizational level

Focal constructs: The scales include twenty one items that were adapted from

Six items for cognitive trust and four items for affective trust were adapted from Mo ̈llering (2002), which reflected our conceptualization The trustworthy research from Mo ̈llering (2002) was also consistent with others (Sako, 1992; Morgan & Hunt, 1994; McAllister, 1995) It was noted that this research also omitted one item from the affective trust, in which, Mo ̈llering (2002) also omitted it due to the proven in the vague meaning and irrelevance measurement of the item

Whilst, six items to measure relationship commitment and four items to measure cooperation were used from the study of Zineldin and Jonsson (2000), in which items reflected with this research’s conceptualization and other notable studies (Mowday et al., 1979; Morgan & Hunt, 1994)

Five-point Likert scales were carried out to construct cognitive trust and affective trust while seven-point Likert scales was implemented to measure relationship commitment and cooperation All constructs used multiple items, which were shown in Appendix

3.4 Process of collecting data

It was crucial to target a variety of companies to avoid the bias of working in the same organization, who might share similar characteristics While the study followed the three main steps above, three main networks were utilized to increase the population The first one was the research’s connection in business A list of suitable contacts with relevant experiences was made through the network Most of individuals in this list hold the managerial positions and were willing to participate when they were asked for permission Secondly, the research also expanded by asking those who have been currently holding the management levels in corporation to share the link to more suitable respondents within their networks Thirdly, the research also received supports from individuals, who agreed to share the link on the Business Networking Association in Ho Chi Minh City and the Chief Executive Officer (CEO) groups at the Foreign Trade University (FTU) in Hanoi

3.5 Characteristics of respondents

There were ninety five respondents that were collected on this questionnaires survey; however, five unqualified individuals were sorted out Among the five unqualified respondents, the reversed question identified two unqualified individuals who responded without consideration In addition, the question of asking direct working experiences with suppliers in the demographic section indicated other three respondents, who had less than three years of working experience, were considered as lacking of relevant experiences for evaluation Thus, this questionnaire survey used ninety samples for the data analysis in Vietnam All of the information was shown in the summary of frequency result (table 3.1)

Number Percentage

Industry Manufacturing 29 32.2

Service 47 52.2

Manufacturing & Service 14 15.6

Organization type Vietnamese organization 4.4

International organization 1.1

Vietnamese enterprise 39 43.3

Joint venture enterprise 15 16.7

Wholly foreign own enterprise 31 34.4

Organization size Less than 100 41 45.6

100-1000 24 26.7

More than 1000 25 27.8

Department Research and product development 2.2

Executive Management 34 37.8

Marketing, sales, customer service 28 31.1

Finance, Accounting, Purchasing 14 15.6

Logistics 4.4

Production 5.6

Human Resource 3.3

Position Senior staff 32 35.6

Supervisor 20 22.2

Owner or CEO 26 28.9

Manager 12 13.3

Working experience

with suppliers Experience (3-5) Experience (6-10) 44 28 48.9 31.1

Experience (>11) 18 20

Gender Female 57 63.3

Male 33 36.7

Age Less than 25 1.1

25-35 53 58.9

35-50 32 35.6

More than 50 4.4

The number of respondents by industry was 29 (32.2%) for manufacturing; 47 (52.2%) for service, 14 (15.6%) for both manufacturing and service

There were four Vietnamese respondents from non-governmental organization and one from German non-governmental organization, who also have experience in dealing with suppliers, participated in this survey The rest 85 respondents worked in business, which included 39 (43.3%) for Vietnamese enterprise, 15 (16.7%) for joint venture enterprise and 31 (34.4%) for wholly foreign own enterprise

The number of respondents who worked in small business, which has the number of employees less than 100 employees were 41 (45.6%); medium business which has number of employee in the range of 100 to 1000 were 24 (26.7%); big corporation which more than 1,000 employees were 25 (27.8%)

There were 34 (37.8%) respondents who worked in general executive management department; 28 (31.1%) for respondents worked in the marketing, sales and customer service department, 14 (15.6%) worked for finance, accounting and purchasing; (5.6%) for production; (4.4%) for logistics; (3.3%) for human resource and (2.2%) for research and product development

This data also received a comment from a respondent, who is the business owner of Volswagen official flagship store (Mar, 2020) that “Selecting right suppliers in Vietnam market is not easy, there are a lot of problems with pricing, relationship problems, legal, commission and so on It's very important to choose legitimate suppliers for security” This comment has become valuable to the research since it strengthened the belief in the challenges in doing business the case of Vietnam

3.6 Descriptive statistics analysis

This part summarized the description of data sample The mean and standard deviations of each construct item, which were determined to access the characteristic description, were shown on the table 3.2

The mean of relationship commitment and cooperation with the majority scored more than on the scale from one to seven (strongly disagree to strongly agree) also showed a good level of agreement on the content of the question There was only one question ‘RC7’, which had the mean score of 2.01, showed the disagreement of the research question This was reasonable since it was a reversed question, which was designed on the purpose of testing the answer consistence with other questions from the respondents The table also recorded a low standard deviation (less than 1) on the majority of each items of relationship commitment and cooperation

3.7 Reliability and validity

The content and construct validity test were taken to increase the reliability and validity The sufficient number of reliable literature was selected, reviewed and used thoroughly All of question items were under revision of supervisors Nevertheless, five experienced friends were invited to a pilot survey before implementation

Furthermore, Cronbach’s coefficient alpha was employed to measure the internal consistency or inter-correlation for the scale within same construct All of the information in this section was shown on table 3.3

Table 3.3 Cronbach’s Alpha

Item Corrected

Item-Total Correlation

Cronbach's Alpha if Item Deleted

Cronbach's Alpha

N of Items

CT 0.898

CT1 0.377 0.927

CT2 0.814 0.866

CT3 0.753 0.876

CT4 0.838 0.865

CT5 0.763 0.875

CT6 0.831 0.864

AT 0.874

AT1 0.701 0.853

AT2 0.764 0.825

AT3 0.798 0.813

AT4 0.666 0.863

RC 0.758

RC1 0.674 0.685

RC2 0.786 0.659

RC3 0.591 0.702

RC4 0.638 0.693

RC5 0.579 0.713

RC7 -0.29 0.873

COO 0.655

COO1 0.453 0.584

COO2 0.473 0.576

COO3 0.55 0.499

COO4 0.336 0.688

Source: Summary result of descriptive analysis on SPSS version 26.0

According to Churchill (1979), the consistency with an alpha values of 0.70 or higher was considered as being adequate Accordingly, the analysis showed qualification of cognitive trust (CT), affective trust (AT), and relationship commitment (RC) The researched recorded the high reliability of CT, AT and RC which the alpha value of more than 0.87 Specifically, the table 3.3 showed the Cronback’s coefficient alpha of 0.898 for CT; 0.874 for AT and 0.758 for RC It was noted on the Cronback’s coefficient alpha that RC7 has the lowest value for “Mean” (2.01) and a value near the middle for “Std Deviation” (0.989) As a requirement in analysis, the corrected item of total correlation must be more than 0.3 if the item deleted was over 0.758; therefore, when the component RC7 was extracted, Cronbach’s Alpha value increased to 0.873 In fact, RC7 was a reversed question and therefore was eliminated for further analysis

CHAPTER 4: DATA ANALYSIS AND DISCUSSION

4.1 Exploratory factor analysis of CT and AT

To implement exploratory factor analysis (EFA), this research run dimension reduction factors with principle components method, the rotation as Varimax and suppress small coefficients with absolute value below 0.3 for analysis KMO and Bartlett’s test of sphericity was also displayed on the description Cognitive trust and affective trust was inserted for an evaluation There was an occurrence value of CT1 on both CT for 0.322 and AT for 0.491; therefore, CT1 was extracted for the measurement of CT for second EFA The detail information was all shown on the following table 4.1:

Table 4.1 EFA of CT and AT

EFA Loading of CT & AT EFA Loading CT & AT (after extraction of CT1) KMO and Bartlett's Test 0.862 KMO and Bartlett's Test 0.85

Sig Sig

Initial Eigenvalues 2.087 Initial Eigenvalues 2.063

Cumulative % 71.653 Cumulative % 76.395

Rotated Component Matrix α Rotated Component Matrix α

CT AT CT AT

CT3 0.886 CT4 0.889

CT4 0.884 CT3 0.888

CT6 0.874 CT6 0.875

CT2 0.872 CT2 0.875

CT5 0.783 0.342 CT5 0.791 0.336

AT2 0.865 AT2 0.866

AT3 0.846 AT3 0.852

AT1 0.817 AT1 0.821

Extraction Method: Principal Component Analysis Rotation Method: Varimax with Kaiser Normalization.a a Rotation converged in iterations

Source: Summary result of EFA on SPSS version 26.0

4.2 Correlation coefficients analysis

This research transformed or computed the variable into a representative factor as following information on the table 4.2:

Table 4.2 Transforming representative factors

Representation Factor Transformation Formula

CT or CT [CT23456] is the representative variable for cognitive trust, which was conceptualized as the confidence, which based on the knowledge of the

party’s performance and capabilities It was the mean of CT2, CT3, CT4, CT5, CT6 since the CT1 was not qualified in the previous EFA

CT = Mean (CT2, CT3, CT4, CT5, CT6)

AT or AT [AT1234] is the representative variable for affective trust, which was defined as the confidence, which based on the natural feeling from the experience of receiving caring or concern in transaction process It was the mean of AT1, AT2, AT3 and AT4

AT = Mean (AT1, AT2, AT3, AT4)

RC or RC [RC123456] is the representative variable for relationship commitment, which was the belief of a worthy relationship and the intention to endure it

sustainably RC was the mean of RC1, RC2, RC3, RC4, RC5 and RC6

RC = Mean (RC1, RC2, RC3, RC4, RC5, RC6)

COO or COO [COO1234] is the representative variable for cooperation, which was conceptualized as the

situation in which the exchange partners work together to achieve mutual goals COO was the mean of COO1, COO2, COO3, COO4

COO = Mean (COO1, COO2, COO3, COO4)

The correlation coefficients analysis (Coakes, Steed, & Ong, 2010) was then implemented and shown on the table below:

Table 4.3 Correlation coefficients Matrix Analysis

Correlations

CT AT RC COO

CT Pearson Correlation 381** 465** 0.162

Sig (1-tailed) 0 0.064

N 90 90 90 90

AT Pearson Correlation 381** 558** 226*

Sig (1-tailed) 0 0.016

N 90 90 90 90

RC Pearson Correlation 465** 558** 528**

Sig (1-tailed) 0

N 90 90 90 90

COO Pearson Correlation 0.162 226* 528**

Sig (1-tailed) 0.064 0.016

N 90 90 90 90

** Correlation is significant at the 0.01 level (1-tailed) * Correlation is significant at the 0.05 level (1-tailed)

Source: Correlation analysis on SPSS 26.0

The table indicated the correlation of all variables for analysis It showed the significant correlation of CT with AT (significance p value of 0.381), significant correlation of CT with RC (significance p value of 0.465), significant correlation of AT with RC (significance p value of 0.558), significant correlation of RC with COO (significance p value of 0.528) and significant correlation of AT with COO (significance p value of 0.226)

COO, which was later double-checked with the regression analysis for further data interpretation

4.3 Regression analysis

Following the guide of data analysis on SPSS statistics from Pallant (2010), a regression analysis was conducted to discover the relationship among these variables

4.3.1 Regression with AT as dependent variable

To evaluate the regression model in supporting the research hypotheses, it was firstly to examine the adjusted R squared (R2) to see the percentage of total variance of the dependent variables (Pallant, 2010) Although the requirement of a high R-square of above 50% or 60% in natural science studies (Hair et al., 2006); the studies in psychology, humanities or social science suggested the appropriate adjusted R-square as being moderate in the range of 13 and 33% (Cohen, 1992; Chin, 1998)

The adjusted R-square value on the table 4.4 above presented the value of 0.135 (over than 0.13); therefore, this value was understood as a medium effect sizes Respectively, the table also showed the qualification of an ANOVA regression significance value of 0.00 (lower than 0.05) The coefficient result with value of 0.00 for CT (lower than 0.05); indicated the significant relationship between CT and AT with the impact value of 0.381

The regression equation, which based on the standardized coefficients, was formed as following: AT = 0.381*CT The variance inflation factor (VIF) values for component indicated the value of are within limit (less than 2); thus, it was concluded that the multi-collinearity problems were not severe to be overly concerned (Pallant, 2010)

4.3.2 Regression with RC as dependent variable

Table 4.5 Regression with RC as dependent variable (CT is predictor)

Model Summaryb

Model R R

Square

Adjusted R Square

Std Error of the Estimate

Durbin-Watson

1 465a 0.216 0.207 0.65920 2.104

Squares

1 Regression 10.555 10.555 24.291 000b

Residual 38.24 88 0.435

Total 48.795 89

Coefficientsa

Model Unstandardized

Coefficients

Standardized Coefficients

t Sig Collinearity Statistics

B Std Error Beta Tolerance VIF

1 (Constant) 3.912 0.308 12.684

CT 0.384 0.078 0.465 4.929 1

a Predictors: (Constant), CT b Dependent Variable: RC

Source: Regression analysis on SPSS 26.0

Table 4.6 Regression with RC as dependent variable (AT is predictor)

Model Summaryb

Model R R

Square

Adjusted R Square

Std Error of the Estimate

Durbin-Watson

1 558a 0.311 0.303 0.61796 1.99

ANOVAa

Model Sum of

Squares

df Mean Square F Sig Regression 15.19 15.19 39.776 000b

Residual 33.605 88 0.382

Total 48.795 89

Coefficientsa

Model Unstandardized

Coefficients Standardized Coefficients t Sig Collinearity Statistics

B Std Error Beta Tolerance VIF

1 (Constant) 2.64 0.441 5.983

CT 0.63 0.1 0.558 6.307 1

a Predictors: (Constant), AT b Dependent Variable: RC

The table 4.5 and 4.6 all showed adjusted R-square value over than 0.13; which presented a medium or moderate effect size The table also presented the ANOVA regression significant value of 0.000 (lower than 0.05)

The coefficient result of the two above tables were all lower than 0.05 (0.000 for both AT and CT); which determined the significant impact of CT and AT on RC The regression equation model, which based on standardized coefficients, was: RC = 0.465*CT and RC = 0.558*AT The beta standardized coefficients of AT (0.558) was higher than CT (0.465); thus, it could be interpreted the stronger impact of that the AT on RC than the impact of CT on RC

The VIF value in the tables also presented the value of (lower than 2) indicated no occurrence of multi-collinearity (Pallant, 2010)

4.3.3 Regression with COO as dependent variable

Table 4.7 Regression with COO as dependent variable (RC is predictor)

Model Summaryb

Model R R

Square R Square Adjusted Std Error of the Estimate Durbin-Watson

1 528a 0.279 0.271 0.59257 2.294

ANOVAa

Model Sum of

Squares

df Mean Square F Sig Regression 11.95 11.95 34.031 000b

Residual 30.9 88 0.351

Total 42.85 89

Coefficientsa

Model Unstandardized

Coefficients

Standardized Coefficients

1 (Constant) 3.015 0.462 6.53

CT 0.495 0.085 0.528 5.834 1

a Predictors: (Constant), RC b Dependent Variable: COO

Source: Regression analysis on SPSS 26.0

The table 4.7 showed the Adjusted R-square value of 0.279 (more than 0.13) and the ANOVA regression significant value of 0.000 (lower than 0.05); which was referred as respectively moderate effect size for analysis (Cohen, 1992; Chin, 1998) It can be interpreted that RC has significant impact on COO Thus, the regression equation was made on the basis of standardized coefficients as: COO = 0.528*RC with no occurrence of multi-collinearity due to the VIF value of (lower than 2)

Table 4.9 Regression with COO as dependent variable (AT is predictor)

The coefficient result on the table 4.8 and 4.9 showed insignificant relationship between AT, CT with COO since both Adjusted R square and ANOVA regression value was not qualified for further assessment

Figure 4.1 Conceptual model in Vietnam

(n.s*: non-significant)

4.4 Discussion

The table 4.10 below showed the summary of the hypothesis testing

Table 4.10 Summary of the hypothesis testing

Hypotheses Results

H1 Cognitive trust positively influences affective trust Supported H2 Cognitive trust positively influences relationship commitment Supported H3 Affective trust positively influences relationship commitment Supported H4 Relationship commitment positively influences cooperation Supported H5 Cognitive trust positively influences cooperation Not supported H6 Affective trust positively influences cooperation Not supported

Affective Trust

Relationship

Commitment Cooperation

Cognitive Trust

β = 0.226 (t= 2.177)

β = 0.528 (t=5.834 ) β = 0.381

(t= 3.864)

β = 0.465 (t= 4.929)

β = 0.558 (t= 6.307) +

The finding presented the significant association of cognitive trust with affective trust This supported the finding of previous existing literature (McAllister, 1995; Johnson & Grayson, 2005; Park et al., 2013) In this situation, it could be interpreted that the focal firms believe that if the suppliers were confident in their business capacities to providing committed products and services, the suppliers would be more confident in making effort to express their willingness, caring to further facilitate the success of the business transactions

The result also gave the significant effect of both cognitive trust and affective trust on relationship commitment The positive influence of both cognitive trust and affective trust on relationship commitment was consistent with the previous literature (Moorman et al., 1993; Morgan & Hunt, 1994; Zineldin & Jonsson, 2000; Abosag et al., 2006; Park et al., 2013) When the focal firms believed that the relationship with the suppliers were important and be convinced by the suppliers’ performance and showing caring in the business transaction, they would strongly believe that the relationship was worthy to maintain and be willing to endure it Nowadays, it seemed like the focal firms acknowledged the importance of a long-term cooperation in transactional process so that they considered both business performance and the caring attitudes from the suppliers to commit in the exchanged relationships

revealed how important role for the suppliers to show the caring and concerns to the firms in order to foster their commitments in maintaining the relationship Even though the finding was similar to a literature (Park et al., 2013), it was interesting to see the important of expressing the willingness and caring in business transactions from the suppliers Perhaps, the focal firms in the emerging economies feel more secured when the exchanged partners showed their willingness and attitude for consideration

Similar to previous studies (Morgan & Hunt, 1994; Zineldin & Jonsson, 2000; Abosag et al., 2006; Park et al., 2013), the relationship commitment was found to influence positively on cooperation It was convincing since the firms, who were committed into the relationship with suppliers would cooperate with the suppliers to make the relationship work effectively for mutual benefits

On the other hand, the findings did not support the direct relationship between trust (both cognitive and affective trust) with cooperation It was different from the findings of direct relationship between trust and cooperation in the developed economies (e.g., Morgan & Hunt, 1994; Zineldin & Jonsson, 2000; Abosag, Tynan, & Lewis, 2006)

infrastructures or the consistency in accounting or financial information In other words, the firm would cooperate only when they made commitment in the relationship, which was promoted by trust development from the suppliers in Vietnam

CHAPTER 5: CONCLUSION

The empirical study was conducted and used correlation and regression analysis to examine how cognitive trust and affective trust were associated with cooperation through the mediating variable relationship commitment in both manufacturing and service industry It revealed the limited impacts of trust on cooperation in Vietnam since the relationship between trust with cooperation was insignificant

Whilst, the finding indicated the influence of cognitive trust on affective trust as well as presented supported impact of both cognitive trust and affective trust on relationship commitment with higher effect from affective trust Since trust was established, relationship commitment was formed, then stimulated cooperation

5.1 Theoretical contributions

This empirical research generalized the commitment-trust theory in the focus of relationship between trust, relationship commitment and cooperation It strengthened the understanding concepts and roles of interorganizational trust with two dimensions of cognitive trust and affective trust in the association with other variables

Importantly, the result indicated insignificant direct impact of both affective and cognitive trust on cooperation, which was different from the result that was found in developed economies

5.2 Managerial implications

To capture more opportunities and mutual benefits, the suppliers are recommended to communicate actively and deliver shared values in building trust with their clients The clients required both cognitive and affective trust; therefore, the suppliers should both improve their business performance in term of the product quality, the time delivery or the accuracy of information sharing to build cognitive trust from the focal firms At the same time, they should make efforts in understanding the client’s needs and make constant efforts in treating customers in a sincere goodwill and showing considerations to establish affective trust

From the side of the clients, the firms are suggested to build a strong relationship commitment with the suppliers It is better for the firms to make efforts as well as be fully open and honest in the maintaining the relationship with suppliers In addition, providing the further supports and the accuracy of information to suppliers in improving the suppliers’ performance is also crucial so that the suppliers can be more confident in assisting more effectively

5.3 Limitations and recommendations

The sample size was the limitation of this research Despite the nature of this study and its targeted samples made it challenging to collect a large scale of sample size, it is suggested to consider other methods to increase its sample size For instance, mentioning some practical contribution of this research may help to increase the willingness to participate from business practicers who deny to participate without seeing the benefits The print survey is also suggested to increase the validity and reliability of collected data

It is more valuable to collect data from the focal firms’ perspectives; however, it will be more objective if the researcher can also access the data from the supplier’s perspective Therefore, it is recommended for further research to consider both perspectives for data collection

It was also captured that in the scale measurement of COO1, the question was so vague that made it hard for the respondents to answer Whilst, the result of mean value and standard deviation from question item COO2 recorded a bias result in answering the questions Even though the measurement of cooperation was consistent and based on reputable theory, the items of COO need to be revised for better assessment in research in the near future

The research also faced limitation in making concise conclusion of relationship and in exploring the complex of interorganizational trust and the hidden reasons behind the relationship among them Therefore, it was encouraged to combine both quantitative and qualitative research for more remarkable exploration In addition, a study in the comparison of two nations, which represent different market economy with the risk as a moderating variable, would make this research highly valued and much more interesting in explaining the situations

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APPENDIXES