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trust for the bull calf buyer, and weak-form trust for the heifer calf buyer.
Strong-form trust characterized the two most important feed suppliers. The
operator commented that a high level of assurance that quality feed would be
delivered in a timely manner created economic advantage to his firm in the form
of lower cost per hundredweight of milk produced.
Cotton Farm (Eight Employees)
The governance mechanism of choice for employees, customers, and suppliers
was contractual in nature for this cotton farmer. Vulnerability was managed
through formal and informal agreements that spelled out expectations and
conditions associated with a transaction. Not a single business relationship was
ranked as strong-form trust. Only one employee relationship exhibited weak trust
where the owner/operator was not exposed to opportunism. Opportunism,
according to this cotton farmer, was present to some degree in all his transactions,
and he used agreements between the transacting parties to manage his risk.
Chemical Supply (Thirteen Employees)
The owner/operator emphasized that he could not operate his business
successfully without strong-form trust with all his employees. Potential oppor-
tunism by salesmen, yard staff, and delivery people created high levels of
vulnerability for the firm. The executive noted that he only retained honest, “low
maintenance” employees he could trust with money, chemicals, and customers.
Likewise, this chemical supply firm had semistrong- to strong-form trust
relationships with its major customers. Opportunism was managed through
handshakes and verbal agreements. Relatively less important suppliers were
ranked in the direction of weaker-trust relationships.
Beef Cattle Feedlot (Four Employees)
This family-operated feedlot raised replacement heifers and veal calves.
According to the owner/operator, strong-form trust employees were critical for his
business. He noted that his employees started out in semistrong-trust relationships
but evolved into “high quality” employees he could trust while he was away on
business trips. The top two customers or buyers were ranked in the strong
category. The manager attributed the diversity of ranking for to the working
relationship the owner/operator had developed with the individual salesperson,
with feed grain, veterinarian services, and hay receiving higher trust rankings than
suppliers of equipment, power, and fuel.
Four central tendencies that can serve as testable hypotheses in further research
efforts emerged from these results. First, it appears that weak trust or commodity-
like exchanges do not dominate the most important economic transactions in these
firms. Owner/operators interact with employees, suppliers, and customers based,