Types of AfL and types of evidence

Developing trust is regarded as another critical factor in managing knowledge processes and collaboration. This section reviews the knowledge management literature in order to understand the link between trust and knowledge sharing, and how trust influences collaboration across diverse groups. Many studies claim that the development of trust is a key determinant for successful collaboration in group working and inter-organisational relationships (Das & Teng, 2001; Geyskens et al., 1996; Geyskens et al., 1998; Håkansson et al., 2004; Jiang et al., 2011; Morgan & Hunt, 1994; Mouzas et al., 2007; Nandhakumar, 1999; Newell & Swan, 2000; Palmatier et al., 2006; Palmatier et al., 2007; Poppo et al., 2008; Ring & Van de Ven, 1992; Squire et al., 2009; Zaheer et al., 1998). The existing empirical literature underpins the role of trust in creating an effective relationship across boundaries in several ways. Developing trust has proven to

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facilitate problem solving (Zand, 1972; Boss, 1978), communication (Thomas et al., 2009), commitment (Ristig, 2009; Paine, 2006; Darrough, 2008), partner satisfaction (Schreiner et al., 2009; Shockley-Zalabak et al., 2010), productivity (Kramer & Cook, 2004), and profitability (Davis et al., 2000; Bibb & Kourdi, 2004). Trust has also been found to foster continuance of collaboration (Jap & Anderson, 2003; Malhotra &

Lumineau, 2011) and team performance (Dirks & Ferrin, 2002; Webber, 2002), while at the same time reducing the perception of risk (Doz, 1996) and transaction cost (Chow, 2008). Empirical studies conclude that trust can be a source of competitive advantage for organisations (Barney & Hansen, 1995; Nahapiet & Ghoshal, 1998). But, in the knowledge management literature the recent surge of interest in the concept of trust is due to its links with knowledge and innovation (Adler, 2001; Huemer et al., 1998;

Marshall et al., 2005).

Before examining the trust-knowledge relationship, I will first define the concept of trust and different dimensions attributed to it. Trust can be defined as “a set of mutual expectations or anticipations regarding each other’s behaviour and each other’s fulfilment of perceived obligations” (Thorelli, 1986, see Madhok, 1995, p.120).

Therefore trust is not simply a "naïve belief" in your partner (Bromiley & Cummings, 1993). Poppo et al. (2008) explain that trust is when the partners recognise that the agreements between them can be violated, but their partner chooses not to behave in their own interests. Sako (1992) defines trust based on how it can be developed in a relationship, giving the partners’ the ability to predict they will be treated in a “mutually acceptable manner”. Trust has also been defined as a risk-taking act or a “willingness to render oneself vulnerable” to the actions of another party (Rousseau et al., 1998, p.395).

Newell and Swan (2000) add to these definitions by providing a threefold typology that has been extensively used and referred to in empirical research. Newell and Swan’s (2000) typology distinguishes between companion trust, competence trust and commitment trust. Companion trust refers to partners’ goodwill or personal friendships, where people rely on their morality in order to behave in certain ways and not to harm their partner. Competence trust is formed on the basis of people’s ability and competence to perform. In this case partners develop a sense of respect for the complementary skills their partners have. The last form of trust in their typology is an institutional trust, called commitment trust, which is shaped and fostered due to contractual agreements between the parties.

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Another way to conceptualise trust is to differentiate between structural and social trust.

Structural or institutional trust is developed and reinforced through institutional factors, such as contracts or other formal mechanisms that build up a security for the parties, so that they feel they will not be abused or mistreated in the relationship (Bradach &

Eccles, 1989; Dyer & Chu, 2003; McEvily et al., 2003). On the other hand, social trust refers to individual people’s confidence in each other’s goodwill and integrity (Madhok, 1995). This research utilises this latter typology of trust because these definitions of trust focus on the mechanisms or methods that are used to develop trust. Where as Newell and Swan's (2000) definition of trust centres mainly on the nature of trust, whether being companion, competence or commitment. Since the thesis aims to examine how development of trust facilitates knowledge processes in cross-boundary work, the structural and social typology and its focus on explaining the methods of trust development is much more relevant to my research. I believe this classification helps me enhance my understanding of the impact of different mechanisms/tools or processes on facilitating cross-boundary collaborations, rather than solely explain what type of trust is being developed.

Jiang et al. (2011) find that both structural and social trust have a significant role in building inter-organisational relationships. Depicting the development of trust as mutually constitutive and a “cyclical” process, Ring and Van de Ven (1994) also believe that both negotiations (formal bargaining, informal sense-making) and commitments (formal legal contract, psychological contract) are required to foster trust in the relationships between organisations (p.112). But other scholars argue that social trust, as “relational capital”, is the key driver of inter-firm collaborations (Kale & Singh, 2009; Kale et al., 2000; Schreiner et al., 2009). For instance, Narayandas and Rangan (2004) study the trust-commitment dynamics in inter-organisational relationships and suggest that inter-personal trust can have a significant impact on commitments, but they do not support the role of institutional or structural trust in these relationships. This stream of research defines social trust as a knowledge-based confidence that is gradually shaped and developed mutually through partners’ informal processes (Zaheer et al., 1998).

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The critical role of trust in facilitating knowledge processes has been highlighted by a vast quantity of research (Abrams et al., 2003; Adler, 2001; Andrews & Delahaye, 2000; Ardichvili et al., 2003; Darvish & Nikbakshs, 2010; Davenport & Prusak, 1998;

Dyer & Chu, 2003; Holste & Fields, 2010; Jonsson & Kalling, 2007; Lee et al., 2010;

Levin & Cross, 2004; McEvily et al., 2003; Mooradian et al., 2006; Newell et al., 2007;

Roberts, 2000; van Wijk et al., 2008). For instance, Niu (2010) examines 188 companies working in four international networks and concludes that trust facilitates open communication and knowledge acquisition. Mooradian and his colleagues (2006) explain the trust-knowledge sharing relationship, highlighting that those with a higher tendency to trust get more involved in knowledge sharing activities. Similarly, Ko (2010), in his study of consultant-expert dyads finds trust as a crucial factor in maintaining an effective knowledge transfer. The link between trust and knowledge transfer in the literature is so strong that some scholars even consider trust as knowledge transfer. For example, Yusof and Ismail (2010) define trust as people’s willingness to share knowledge in order to gain mutual benefits and protect them from being exploited by the other actors within the organisation.

As stated above, the literature establishes the relationship between trust and knowledge sharing. However, it generally only links the social or relational aspect of trust to knowledge sharing, claiming that the trust which is developed through interpersonal relations has a significant impact on knowledge processes (Adler, 2001; Darvish &

Nikbakshs, 2010; Dyer & Chu, 2003; Jonsson & Kalling, 2007; Lee et al., 2010;

McEvily et al., 2003; Mooradian et al., 2006; Narayandas & Rangan, 2004; Newell et al., 2007; van Wijk et al., 2008). In contrast, contractual obligations do not always seem to be effective in facilitating knowledge integration, especially when tacit knowledge needs to be shared between different expert groups (Inkpen & Pien, 2006). The stable and fixed nature of contracts often cannot reflect the details and intensity of knowledge that is expected to be shared.

Rather than contracts, forms and structures, high levels of social interaction are sometimes needed to develop trust and enable the partners to share tacit knowledge (Becerra et al., 2008; Kale et al., 2000; Zajac & Olsen, 1993). Similarly, Holste and Fields’ (2010) study of professional managers in an international organisation underline

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that personal trust, developed through personal relationships, had a greater impact on the sharing of tacit knowledge, than structural and institutional trust. Another good example of the link between social trust and knowledge sharing is Harryson and his colleagues’ work (2008). This study showed that the management had to encourage informal social interactions in order to increase the level of trust and knowledge sharing between different expert groups. But this perspective was disputed by Mouzas et al.

(2007) who claim that trust should be conceptualised differently for inter-organisational relationships, suggesting that interpersonal trust will be insufficient for the collaboration between firms. They argue that protective mechanisms and standards should be used , alongside social trust, in order to facilitate business relationships.

Trust in Cross-Boundary Collaborations

Having reviewed the literature on the concept of trust, it can be concluded that trust, especially in the context of inter-organisational collaboration, is a multi-dimensional concept (Currall & Inkpen, 2006; Mouzas et al., 2007). The importance of trust and its significant impact on knowledge sharing in cross-boundary collaboration cannot be denied (Adler, 2001; Argote et al., 2003; Dyer & Chu, 2003; Jonsson & Kalling, 2007;

Narayandas & Rangan, 2004; Newell et al., 2007; van Wijk et al., 2008). However when there is a limited amount of shared and common knowledge, as well as a weak or no sense of identity between the groups working together, the development of trust becomes a complex and difficult task (Hislop, 2013; Janowics-Panjaitan &

Noorderhaven, 2009). The complexity of trust in cross-boundary work can be explained by its link to perceptions of risk, uncertainty and vulnerability. As Hislop (2013) highlights “development of trust-based working relations is by no means easy or straightforward, especially when the groups collaborating perceive that their interests may be conflicting” (p.179).

Research suggests that trust mitigates the perceptions of risk and failure, thus encouraging knowledge processes in these contexts (Nonaka & Takeuchi, 1995;

Quigley et al., 2007). In other words, it is suggested that organisations need “trust as an input condition in order to stimulate supportive activities in situations of uncertainty or risk” (Luhmann, 1988, p.103). Thus, trust is used as a form of control to relieve uncertainty or risk in organisations (Das & Teng, 2001; Rodriguez & Wilson, 2002).

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However, it can be argued that individuals/teams/groups face some elements of risk when they trust their partner(s) and share their knowledge with them. In other words, knowledge providers put themselves in a vulnerable position and they might lose competitive advantage if valuable knowledge is shared with a competitor (McEvily et al., 2003). This is particularly true when the partners view knowledge as a source of power (Kim & Mauborgne, 1998; Szulanski, 1996). Another part of the risk is that the recipient of knowledge may absorb poor quality knowledge that might have been conveyed with bad intentions (Mooradian et al., 2006). Therefore, sharing knowledge equals risk for the knowledge provider in such circumstances.

Since cross-boundary work and knowledge integration also involve elements of risk (Mooradian et al., 2006; Rousseau et al., 1998), I adopt Rousseau and her colleagues’

depiction and define trust as a risk-taking act or a “willingness to render oneself vulnerable” to the actions of another party (Rousseau et al., 1998, p.395). Structural and social trust have been found to have different impacts on different settings and studies.

As some highlight implementing protective mechanisms to develop trust (Dyer & Chu, 2003; McEvily, et al., 2003; Mouzas et al., 2007), others claim that social or relational trust enable different groups to engage in collaborative relationships in which knowledge is integrated successfully (Kale & Singh, 2009; Kale et al., 2000; Schreiner et al., 2009). However, the question of which dimension of trust (social and/or structural) facilitates knowledge processes when uncertainties and risk reside in the environment remains unanswered. This thesis addresses this gap in the existing literature and examines how the development of trust influences knowledge processes in the complex, uncertain and risky relationship of publishers and developers in the videogame industry.