Coping with Interpartner Uncertainty in Interorganizational Interactions

Abstract: Interorganizational relationships are uncertain endeavors. By engaging in such relationships, organizations become vulnerable to their partner’s behavior and their success is contingent on the partner’s willingness and ability to fulfill its promises. Despite the plethora of benefits provided by interorganizational relationships, organizations face difficulty in understanding and anticipating each other’s future behavior, in aligning their views and expectations, and in predicting the potentialities of their interactions due to the influence of the broader relational context. This difficulty stems from incomplete knowledge about the intentions of the partner and it is particularly salient within coopetitive interorganizational relationships, i.e., relationships involving the simultaneous pursuit of cooperation and competition, as the partners have only partially convergent interests. Whereas prior research has focused on how firms can manage calculable risks through static governance mechanisms, little is known about the underlying processes of how firms cope with interpartner uncertainty. In this thesis, I address the following purpose: to advance the understanding of the processes through which firms cope with interpartner uncertainty in interorganizational interactions.The purpose is addressed through five research papers, which build on each other and synergistically shed light on different processes through which organizations cope with interpartner uncertainty along the course of their interactions. With an inductive approach, this thesis mainly draws on a qualitative case study of interorganizational interactions in the robotics and automation industry in Sweden. In addition, two literature reviews and a quantitative study supported the fulfilment of the overall purpose. The findings of this thesis establish that three possible means of coping with interpartner uncertainty in interorganizational interactions are the adoption of both trust and distrust as organizing principles, reliance on hybrid interpretive schemes as forward-looking lenses and the use of digital artifacts as boundary objects. In addition, I provide answers about how each of these means of coping supports organizations to cope with interpartner uncertainty by influencing their interaction dynamics. Building upon these findings, I argue that the process of coping with interpartner uncertainty has three distinct, yet interrelated dimensions, namely managerial cognition, relationality and materiality. The thesis concludes by outlining the main theoretical contributions to the bodies of literature on uncertainty in interorganizational relationships, interorganizational trust, and coopetition. Finally, managerial implications are also outlined.