Trust in B2B E-Commerce Virtual Communities

Abstract

In any virtual community, issues of trust can dictate the level of interaction among participants within that community. In business-to-business (B2B) electronic commerce (e-commerce), trust is an important factor in an organization’s willingness to expose itself to certain business risks without perfect knowledge of another organization’s capabilities, commitment or intentions. Within a virtual B2B community, the negotiation for the purchase and selling of goods, services and information involves little or no physical interaction such as eye contact or handshakes. Additionally, there is limited accessibility to physical locations that may display goods or be a source of information that could be used for assessing the trustworthiness of organizations. Although the Internet provides a medium for interconnecting a broad range of potential business partners at relatively low start-up and ongoing costs, the inherent information asymmetries create additional risks not present in traditional commerce. Individual organizations are required to dynamically assess and mediate these risks through the implementation of strategies for limiting the exposure of valued information assets and protecting resources. Since it is not feasible, nor practical, to eliminate all risks associated with online B2B collaborations, a means for establishing and maintaining levels of mutual trust is essential among multiple organizations that participate in electronically based transactions.