From Trust to Inter-organizational Innovation: The Differential Mediating Roles of IT- based Process and Knowledge Assets

This study examines the relationship between trust, innovation and IT assets in the context of inter-organizational relationships (IORs). We parse two dimensions of inter-organizational IT-based assets - IT-based Process Institutionalizations and IT-based Knowledge Institutionalizations - based on the purposes for which these assets are deployed by the collaborating organizations. Based on prior literature, we also identify two dimensions each of trust, namely competence and benevolent trust; and of innovation, namely incremental and radical innovation. We then develop a model featuring two distinct pathways between trust and innovation: one pathway posits that competence trust between the parties will correspond with IT-based Process Institutionalizations between them and result in outcomes representing incremental innovation; the other pathway posits that benevolence trust between the parties will correspond with IT-based Knowledge Institutionalizations between them and result in outcomes representing radical innovation. We validate this model using meta-analysis and find support for all our hypotheses.