A model for enhancing trust in South African automotive supply chains through information technology

Abstract

The South African automotive industry is recognised as an important sector for the economy and has thus been prioritised by the South African government. The success of the automotive manufacturers depends on the efficiency and effectiveness of their supply chain. Due to the large number of suppliers involved in these supply chains, enhancing trust in the inter-organisational relationships can ensure the competitiveness of the supply chain. Additionally, insufficient trust can disrupt information sharing between supply chain partners which further impacts on supply chain operations and hence supply chain competitiveness. Thus, both insufficient trust and insufficient information sharing are viewed as contributing factors to the inefficiency and ineffectiveness of a supply chain’s operations. The use of Information Technology to facilitate inter-organisational relationships, in particular in terms of improving information sharing, is an important consideration in this research project. As in the Prisoner’s Dilemma, when supply chain members share information freely, trust levels are increased, hence supply chain effectiveness and efficiency is achieved and therefore the competitiveness of the supply chain is optimised. This study addresses the problem of enhancing trust in automotive supply chains using Information Technology. Previous studies have recognised the importance of trust and information sharing in supply chain relationships. These previous studies have also considered the effect of trust on information sharing, or the effect of information sharing on trust in a single direction. Thus, to address this research problem, a cyclical relationship between trust and information sharing is proposed. In this respect, Information Technology should be used to nurture this cyclical relationship between trust and information sharing. A model for the enhancement of trust in automotive supply chains through Information Technology is proposed to achieve the objectives of this research project. This model includes risk perception; information sharing as a means of enhancing trust; a trust area that consists of both supply chain partner trustworthiness and system trust; the resultant trusting behaviour; and the resultant improved information sharing. As this study is concerned with the use of IT to enhance trust, the inclusion of system trust as a component of the model is a significant contribution of this study which is complementary to the proposed cyclical relationship between trust and information sharing