The relationship between a seller and a buyer can be complicated due to competing interests and priorities, the imbalance or shifts in power, and other considerations. Nonetheless, researchers and practitioners have developed a model for understanding the quality of a particular buyer-seller relationship that factors in the level of trust.
Lewicki-Bunker Three Stages of Trust
In the book chapter “Trust in Relationships: A Model of Development and Decline” that appeared in the 1995 book “Conflict, Cooperation, and Justice,” authors Roy J. Lewicki and Barbara Benedict Bunker provided a theoretical model for analyzing trust in professional relationships such as buyer-seller relationships.
Central to the Lewicki-Bunker model is a basic assumption that trust is a multidimensional construct that can evolve according to the stage of the relationship. Thus, this model also includes the proposed three stages of trust: calculus-based trust, knowledge-based trust, and identification-based trust.
Take note of the following Lewicki-Bunker Three Stages of Trust:
1. Calculus-Based Trust: The calculus-based trust is the most basic level or stage of trust. It is based on an assumption that a particular party is naturally deterred from violating trust because doing so could lead to high costs in the form of financial setbacks, reputational risks, and legal predicaments. In other words, it is an expectation based on the trade-off between risk and utility.
Note that calculus-based trust is the easiest to establish. The terms and conditions of contracts essentially provide the foundation for this stage of trust. There is no need for parties in a buyer-seller relationship to enter into additional relational commitments and measures.
2. Knowledge-Based Trust: The knowledge-based trust is based on familiarity and predictability. Unlike calculus-based trust, this second stage of trust depends on information rather than deterrence. Involved parties are able to develop generalized expectations about each other using information collected over time. This allows them to predict the actions and reactions of one another with accuracy.
Establishing knowledge-based trust requires time. It simply develops with time as a result of continuous interactions, specifically pronounced communication and courtship that result in the accumulation of relevant information or in other words, deepening level of familiarity. For as long as parties in a buyer-seller relationship are able to deliver predictable results, trust endures.
3. Identification-Based Trust: The identification-based trust is the highest deepest level in the Lewicki-Bunker Three Stages of Trust model. This is based on a sense of identification and oneness with each other or more specifically, with the alignment of values or organizational purpose, goals, and objectives of the involved parties. Trust exists because each party understands the desires of the other party and both work together to achieve mutual benefits.
The identification-based trust is the hardest to achieve. It goes beyond good will or commitment to deliver expected results. This specific stage of trust can only exist through total empathy and mutual understanding. A particular party in a buyer-seller relationship work hard not only for its own gain but also for the gain of the other party.
Takeaway: Using the Three Stages of Trust
The Lewicki-Bunker Three Stages of Trust model provides an organization with a way to evaluate the quality of a particular buyer-seller relationship in which it is involved. Doing so is important in building and maintaining such relationship. In addition, an organization that transacts with a supplier or vendor can also use the Lewicki-Bunker model as part of evaluating its procurement performance and supply management strategy. Sellers can also use the model as a reference in developing its business-to-business marketing strategy.
REFERENCE AND FURTHER READING:
(1) Lewicki, R. J. & Bunker, B. B. 1995. Trust in Relationships: A Model of Development and Decline. In eds. B. B. Bunker & J. Z. Zubin, Conflict, Cooperation, and Justice. California: Jossey-Bass Publishers