Does Trust matter? Insights into Japanese-German International Joint Ventures

This research addresses the nature and functioning of relationships of interpersonal trust and interorganisational trust in international joint-ventures (IJVs), by investigating Japanese-German IJVs. We applied a model of gradual development of trust, reflecting the dynamic of evolving co-operation between business partners: calculative trust, cognitive trust and normative trust. Results showed that this threefold distinction of trust can be identified in IJVs in both countries. It turned out, however, that the Japanese companies are more predisposed to trusting their partner than the German companies. This reveres our conceptual model in the Japanese case, starting from the normative perception of trust. By analysing the interconnection between interpersonal trust and interorganisational trust, we found out, that in Japanese-German IJVs strong confidence in the partner was emphasized at the interorganisational level. For IJV performance in general trust seems to be one of the key factors. However trust evokes not from its own in IJVs. Without commitment towards the IJV and without cultural sensitivity to each other, partners fail to work out problems and get the feeling that the co-operative venture is not worth the effort.