The effect of uncertainty avoidance and social trust on supply chain collaboration By: Wen Guang Qu and Zhiyong Yang Qu, Wenguang and Zhiyong Yang (2015), “The Effect of Uncertainty Avoidance and Social Trust on Supply Chain Collaboration,” Journal of Business Research, 68(5), 911–918. https://doi.org/10.1016/j.jbusres.2014.09.017 © 2014 Elsevier Inc. This work is licensed under a Creative Commons Attribution- NonCommercial-NoDerivatives 4.0 International License. Abstract: Supply chain collaboration (SCC) is strategically important in today's business world, and the use of inter-organizational systems (IOS) much facilitates SCC. The present study examines: (1) the differential effects of two types of IOS—open and closed—on firms' use of SCC; (2) the impact of a country's uncertainty avoidance and social trust on firms' use of SCC; and (3) the moderating role of uncertainty avoidance and social trust on the firm-level relationships between open/closed IOS and SCC. Using a large dataset from twenty-four countries, a multi-level analysis suggests that, not only uncertainty avoidance and social trust affect SCC directly, but uncertainty avoidance also moderates the relationship between open IOS and SCC at the firm level. These findings are important for the research and practice of SCC, as they provide novel angles for researchers and managers to look at the factors that may affect the success of SCC. Keywords: uncertainty avoidance | social trust | supply chain collaboration (SCC) | open inter- organizational systems (IOS) | closed IOS Article: 1. Introduction Increasingly, supply chains are replacing individual firms as the competitive unit in many industries (Kumar, 2001, Swaminathan and Tayur, 2003). Effectively managing resources and collaborations across partnering firms in a supply chain has become the dominant concern. More and more firms have begun to coordinate their production and distribution networks and collaborate with supply chain partners rather than manage their internal resources alone (Baraldi et al., 2012, Dyer and Singh, 1998). Supply chain collaboration (SCC)—such as information sharing, collaborative forecasting, and joint new product development—can be a source of strategic advantage (Rai et al., 2006, Subramani, 2004). Wal-Mart's success is an excellent example. In the late 1980s, Wal-Mart was only a small retailer. To reduce its inventory level from 30-day to 5-day, Wal-Mart was the leading pioneer in the industry in developing collaborative commerce, using an EDI-based supply chain management system to connect its largest suppliers to its inventory management system. This approach has allowed Wal-Mart to secure its cost leadership in the industry and to establish competitive advantages over its competitors.