The effects of trust and coercive power on supplier integration

Supply chain integration nowadays is considered an important approach to building and sustaining competitive advantages. Many previous empirical researches have investigated trust and power between suppliers and customers, yet, the effects of trust and coercive power on supply chain integration are still largely unknown. This study investigates trust, coercive power and their interaction and their impact on internal and supplier integration, based on data collected in Chinese supply chains. The results reveal that both trust and coercive power improve internal and supplier integration, but when trust is low, coercive power reduces internal integration. Contradictory to conventional wisdom that coercive power hinders cooperation, this study found that coercive power improves supplier integration in Chinese supply chains, with or without the presence of trust. This study provides significant insights for Chinese inter-organizational trust-power relationship management and supply chain integration practices.