The essay on a subject: ‘The role of trust in modern international management’

Research Methodology

The essay on a subject: ‘The role of trust in modern international management’

Baranova Olga

Introduction

The modern markets are characterized by new approaches to ensuring competitive advantages. In their basis formation of the business models considerably increasing capitalization of the company and promoting migration of values in the corresponding business. Creation of competitive business model assumes the careful analysis and the accounting of social factors of development of the organization, use of intangible assets of economic growth to which number refer trust. Since some forms of negotiations usually precede every commercial activity, the importance of cross-cultural negotiation has grown manifold in the recent past. The increased importance of cross- cultural negotiations can be evidenced by the publication of brochures on cross-cultural negotiations by different governmental and multi-lateral agencies and by the introduction of negotiation courses in different business schools across the world.

Although globalization has reduced the temporal and spatial gaps among negotiators across the world, it often widens the gap between negotiating parties because of cultural and national differences. The increased global interdependence may, therefore, exacerbate the complications of cross-cultural negotiations.

Despite its importance, research on cross-cultural business negotiation has not been very systematic. Therefore, most of the empirical studies on cross-cultural negotiation hitherto published lack the explanatory power that is necessary for theory building.

The role of trust

The role of trust in modern business becomes more and more notable. Informal horizontal communications admit more important official, and electronic technologies allow members of teams to work at big distances from each other and out of direct control. Controllability of the organizations depends on trust between employees and the management more and more, and its borders pass where the trust, which is gradually decreasing in process of removal from the center of the company, is completely replaced with calculation and sanctions. Idea of organization environment began to change. Not in itself advance of the goods, and formation of marketing of the relations – expansion of base of regular customers, contractors and partners becomes a task. Quality management isn't reduced any more only to characteristics of the goods or processes in a chain of creation of value – into the forefront there is a quality of the relations. Although trust is a difficult to define concept, there is an agreement that is important for organizations in a number of ways. It enables cooperative behavior, promotes adaptive organizational forms, eases the management of conflicts, decreases transaction costs, supports organizational change, and curtails opportunistic behavior. Furthermore, trust is required to reduce uncertainty, promote a more participative management style, and lower the formalization in organizations emphasizing the delegation of authority to the members of the committee to decide about the vital issue of funds distribution.

However, a ‘great deal of conceptual confusion’ implies to the various sources, forms and functions of trust and makes it a ‘complex and slippery’ concept. Basically, in the literature the notion of trust is based on different foundations. At one side is the approach that assumes an undersocialised human behavior which most influenced by the rational decision model and economic theory. In that approach trust’s extrinsic value is defined as an element of a transaction between two parties and refers to the confident expectation based on the predictability of another party’s behavior, that one’s interest will not be harmed or put at risk by the other. On the other hand, an oversocialised view of behavior formulates the importance and conceptualization of trust. In this approach, trust is referred as the concern of confident expectation based upon the other party’s goodwill that one’s interests would be protected. This approach is often analyzed as a facilitator of long-term interdependent and stable relationships. An interesting contribution to organizational processes is trust’s role in governing arrangements. Understanding governance as the outcome of interaction and interdependencies of a range of political actors, trust is required to support the actual operation of the exchanges through which governance occurs. Trust as an element of governance is related to effective control, cooperation, deliberation, participation and / or delegation of authority, communication, procedural justice and organizational support. In public services organizations in particular, trust found to be associated with important aspects of governance. In organizations with increased trust there is more organizational commitment and productivity. Also, trust in senior management influences the extent to which employees are cynical towards change and the extent and conditions under which employees intend to remain in the employ of the organization. However, it should be acknowledged that different levels of trust have been observed in different levels of management.

Once considering governance as a process an outcome of interactions and interdependencies the organizational context of such processes should be considered when studying trust. The role of trust in such a perspective is an important insight of managing a range of organizational challenges.

Pluses and minuses of trust

It is known that in teams with high level of trust employees endure stresses easier and above estimate productivity of collaboration. The trust of members of team to each other allows increasing commitment to collective, readiness for mutual aid, reduces conflictness, and also costs of the head for control of performance of tasks. Besides, transition to the competition on the basis of the intellectual capital demands such relations between employees who would stimulate them to exchange knowledge and experience with each other, and also to share them with other representatives of the organization. But ways of an exchange of ideas and knowledge in the company not always coincide with the lines of the communication that have been set by organizational structure. Really important data and skills are transferred only where the connection based on trust is established. In this case, addressing for council, the person doesn't risk seeming silly or incompetent; trying to understand the failure reasons – disputed; addressing for feedback – diffident. Therefore, teams with high level of trust study on personal and others' experience even quicker. However the similar relations have also a reverse side:

· The trust is higher, the less members of team supervise each other;

· Than more solid collective, especially employees are inclined to unreasoned decisions (they believe in partners and involuntarily overestimate their forces at existence of external threat. The aspiration to keep unanimity in team reduces ability to watch at the decisions critically);

· The atmosphere of trust creates ideal conditions for the unfair employees which abuses not only can lead to serious losses, but also spoil the relations in group.

· Many consider that it is possible or to trust the person, or isn't present – the third isn't given. Nevertheless the trust and mistrust are quite compatible. For example, the co-owner of one of trading companies is confident in ingenuity and determination of the partner during the crisis moments, but refuses to trust it staff recruitment. In any collective there are employees, to creativity and which professional opinion can be trusted, but it is undesirable to charge to them even simple administrative functions. At last, it happens that it is possible to trust competence of the employee, but not to his good will and loyalty. The absolute trust is destructive.

To avoid its negative consequences, work at the same time with its rational and emotional components that can consist in the following is necessary:

· Organization “fair of knowledge” and joint with colleagues drawing up of the card of competence of the team: who and in what questions is an expert, including outside of the functional duties. Carrying out different team training. All this will help to outline trust zones to each other in business matters.

· Development of interest in mutual control. It is desirable, that at meetings members of team regularly provided each other feedback, analyzed weak places and potential threats. At first it is possible to use control sheets to verify, whether everything is considered. If to define 3–5 key indicators of overall performance of group and to each employee periodically to estimate them in points, it is possible to receive an objective picture of an available situation. Certainly, in a compensatory package of participants there should be a share depending on command result, differently these measures will bring a boomerang effect. In some teams the right to a mistake” is entered “: its timely recognition increases efficiency of all collective.

· Transfer of a role of the chairman and the official critic at meetings in turn to different members of team that each of them at least time visited both that and another.

· In case of trust loss by one of members of team it is necessary to recognize openly at once existence of a problem and accurately to designate principles according to which this question will be considered. It is necessary to get rid consistently of "cynics", especially if they achieve good results, breaking values and norms of collective. It is possible to use "credibility" deserved at team in order that the unpredictable behavior to reveal those people in group (depriving of their feeling of safety) which don't trust anybody.

Conclusion

Concerning the trust it is possible to divide people into two groups. The first, which indicated more trust towards others were found to be willing to be more accountable, even when elements of the process were not favorable. Their attitude of trust also facilitated a much more tolerant perspective, while adopting a cooperative stance in order to overcome the difficulties faced in the procedure of the resource allocation. The second, who expressed less trust tended to be willing to make less effort to be accountable and they also tended to perceive the complexities and difficulties of the system or the resistance to cooperate during the process as deliberate efforts of the ‘other side’ to manipulate the process. Therefore trust is an important aspect for governing arrangements, especially where accountability is necessary. Therefore, it is important to broaden the scope of trust within organizational process for more advanced understanding of social systems of governance within organizations and certainly not to exceed a trust limit.

Дата добавления: 2015-11-04