The Impact of Social Trust on Strategic Performance in Manufacturing Companies in Sanandaj: The Mediating Role of Innovation
Subject Areas : Business ManagementArman Ahmadizad 1 , siran salavati 2 , Mohsen Ebrahimzadeh 3 , Khosro Akbari 4
1 - Assistant Professor, Department of Management, University of Kurdistan, Iran
2 - Master of Commerce Management, Islamic Azad University, Sanandaj Branch, Sandandaj, Iran
3 - Master Student of Business Administration, University of Kurdistan, Iran
4 - Master of Business Administration Management, University of Kurdistan, Iran
Keywords: Manufacturing Companies, Innovation, Social trust, Strategic Performance,
Abstract :
The current descriptive study aimed to explore the impact of social trust on strategic performance in manufacturing companies in Sanandaj with a focus on the mediating role of innovation using the Structural Equation Modeling. The random sample of 111 comprising three groups of CEO, production managers and marketing and sales managers were selected from the population of the staff working at all manufacturing companies in Sandandaj with at least three years of active production experience. The research data were collected through administering three standardized questionnaires including the Innovation Questionnaire, Social Trust, and Strategic Performance Questionnaires, each with respective reliability estimates of 0.79, 0.81 and 0.77. The results obtained from the Structural Equation Modeling revealed a significant relationship between innovation and social trust. Also, the findings indicated that social trust had significant and positive impact of on strategic performance through innovation. That is, trust and innovations are among prerequisite conditions of strategic performance whose increase will bring about a subsequence growth in strategic performance.
Amirpour, M.(2007), Sociological Survey of the Level of Social Trust of Ethnic Groups on Government Social Policies. Phd Thesis, Tehran: Islamic Azad University, Science and Research branch, (In Persian).
Nahandi, Y. B., Hassamzadeh, R. B., & Jalalifar, Z.(2014), Investigating the Relationship between Social Responsibility and the Performance of the Companies Listed in Tehran Stock Exchange. Productivity Management, 7(28), 169-164. (In Persian).
Bashirie, H.(1996), The ideology and Political Culture of the Ruling Groups in the Pahlavi Era. Journal of Philosophy & Theology, 8, 74-85. (In Persian).
Chelbi, M.(1995), Methodological Realism in Sociology. Journal of Recognition, 17, 49-70. (In Persian).
Chelbi, M.(2010), Sociology of Order: Anatomy and Theoretical Analysis of Social Order. Tehran: Ney Publication, (In Persian).
Choupani, H.(2011), Investigating the Relationship between Transformational Leadership and Organizational Innovation Trend in Alborz Insurance Joint Stock Company. Master Thesis. Tehran: University of Tehran, (In Persian).
Choupani, H., Khalili, M. Z., Ghasemi, A., & Gholamzadeh, H.(2012), An Investigation into the Relationship between Intellectual Capital and Organizational Innovation (Case: Toseeh Insurance Company). Quarterly Journal of Innovation and Creativity in Human Science, 2(1), 27-59. (In Persian).
Ghadimi, M.(2007), The Study of the Level of Social Trust and Factors Affecting it among Students of Zanjan Universities. Journal of Human Sciences, 53, 325-356. (In Persian).
Giddens, A.(1998), Essentials of Socialogy. Translated by: M. Sabouri, Tehran: Ney Publication, (In Persian).
Hosseini, A. M., & Barkhordar, B.(2007), The Relationship between Self-Management Skills and Innovation among Employees in Kerman Province Organizations. Journal of Executive Management, 7(27), 105-120. (In Persian).
Hosseini, R. N. S., & Safiri, M.K.(2002), The Effect of Organizational Entrepreneurship on Organizational Socialization and Organizational Commitment in the Employees of Physical Education Departments of Mazandaran Province. Journal of Sport Management, 6(1), 89-108. (In Persian).
Kaffashi, M., & Fathi, S.(2011), The Effect of Social and Cultural Indices on the Level of Social trust of Tehrani Citizens to Islamic Azad University. Journal of Iranian Social Development Studies, 3(2), 49-74. (In Persian).
Kafi, M.A.(2001), Social Trust and the Factors Affecting It. Journal of Research Index, 18, 9-42, (In Persian).
Keshtmand, M., & Khosravi, T.(2014), Investigating the Impact of Spatial Advantages, Organizational Resources and Organizational Capabilities on Export Strategic Performance (Case Study of Export Companies in Kermanshah). Master Thesis, Kermanshah: Islamic Azad University, (In Persian).
Pourafkari, N.(2012), Comprehensive Dictionary of Psychology-Psychiatry. Tehran:Contemporary Culture Publication, (In Persian).
Saeedi, P.(2010), Managers’ View Point with Retard to Effective Individual, Group and Organizational Factors in Creativity. Journal of Analytical-Cognitive Psychology, 2, 9-20. (In Persian).
Tabrizi, A. M., Moidfar, S., & Golabi, F.(2011), Generational Approach to Examine the Social Trust among Different Generations. Journal of Applied Sociology, 22(1), 41-70, (In Persian).
Toulaee, R.(2007), New Approaches to Organizational Performance Evaluation. Journal of Police Human Development, 12, 9-30. (In Persian).
Zarghami, H. R., Jafari, M., & Akhavan, P.(2012), The Study of Relationship between Creativity and Motivation for Innovation in Research Organizations (Case Study: Research Center of Intelligent Signal Processing (RCISP). Quarterly Journal of Innovation and Creativity in Human Science, 1(4), 37-64. (In Persian).
Ackoff, R. L., Ackoff, R. L., & Emery, F.E.(2005), On Purposeful Systems: An Interdisciplinary Analysis of Individual and Social Behavior as a System of Purposeful Events.
Agha, S., Alrubaiee, L., & Jamhour, M.(2011), Effect of Core Competence on Competitive Advantage and Organizational Performance. International Journal of Business and Management, 7(1), 192.
Aryanto, R., Fontana, A., & Afiff, A.Z.(2015), Strategic Human Resource Management, Innovation Capability and Performance: An Empirical Study in Indonesia Software Industry. Procedia-Social and Behavioral Sciences, 211, 874-879.
Anderson, J. C., & Narus, J.A.(1990), A Model of Distributor Firm and Manufacturer Firm Working Partnerships. Journal of Marketing, 42-58.
Bedarkar, M., & Pandita, D.(2014), A Study on the Drivers of Employee Engagement Impacting Employee Performance. Procedia-Social and Behavioral Sciences, 133, 106-115.
Bhuvanaiah, T., & Raya, R.P.(2015), Mechanism of Improved Performance: Intrinsic Motivation and Employee Engagement. SCMS Journal of Indian Management, 12(4), 92.
Cao, C., Xia, C., & Chan, K.C.(2016), Social Trust and Stock Price Crash Risk: Evidence from China. International Review of Economics & Finance, 46, 148-165.
Chua, R. Y., Morris, M. W., & Mor, S.(2012), Collaborating Across Cultures: Cultural Metacognition and Affect-Based Trust in Creative Collaboration. Organizational Behavior and Human Decision Processes, 118(2), 116-131.
Davila, T., Epstein, M., & Shelton, R.(2012), Making Innovation Work: How to Manage It, Measure It, and Profit from It. FT Press.
Delhey, J., & Newton, K.(2003), Who Trusts?: The Origins of Social Trust in Seven Societies. European Societies, 5(2), 93-137.
De Mozota, B.B.(2003), Design Management: Using Design to Build Brand Value and Corporate Innovation. Skyhorse Publication.
Drucker, P.(1985), Innovation and Entrepreneurship. New York: Harper & Row.
Glor, E.D.(2001), Innovation Patterns. The Innovation Journal: The Public Sector Innovation Journal, 6(3), 1-42.
Grimmelikhuijsen, S., Porumbescu, G., Hong, B., & Im, T.(2013),The Effect of Transparency on Trust in Government: A Cross‐National Comparative Experiment. Public Administration Review, 73(4), 575-586.
Hu, X., Wu, G., Wu, Y., & Zhang, H.(2010), The Effects of Web Assurance Seals on Consumers' Initial Trust in an Online Vendor: A Functional Perspective. Decision Support Systems, 48(2), 407-418.
Kanter, R.M.(2003), Challenge of Organizational Change: How Companies Experience It and Leaders Guide It. Simon and Schuster.
Klein, J.(2012), The Open-Door Policy: Transparency Minimizes Conflicts between School Principals and Staff. International Journal of Educational Management, 26(6), 550-564.
Koehn, D.(1996), Should We Trust in Trust?. American Business Law Journal, Vol. 34, 2, 183-204.
Liao, S. H., Fei, W. C., & Chen, C.C.(2007), Knowledge Sharing, Absorptive Capacity, and Innovation Capability: An Empirical Study of Taiwan's Knowledge-Intensive Industries. Journal of Information Science, 33(3), 340-359.
Maital, S., & Seshadri, D.V.R.(2012), Innovation Management: Strategies, Concepts and Tools for Growth and Profit. SAGE Publication.
Mariadoss, B. J., Milewicz, C., Lee, S., & Sahaym, A.(2014), Salesperson Competitive Intelligence and Performance: The Role of Product Knowledge and Sales Force automation Usage. Industrial Marketing Management, 43(1), 136-145.
Marsick, V. J., & Watkins, K.E.(2003), Demonstrating the Value of an Organization's Learning Culture: The Dimensions of the Learning Organization Questionnaire. Advances in Developing Human Resources, 5(2), 132-151.
Mayer, R. C., & Gavin, M.B.(2005), Trust in Management and Performance: Who Minds the Shop While the Employees Watch the Boss?. Academy of Management Journal, 48(5), 874-888.
Misztal, B.A.(1996), Trust in Modern Societies: The Search for the Bases of Social Order. Blackwell. Cambridge: Polity Press.
Mohsin, A. A., Halim, H. A., & Ahmad, N.H.(2015), Competitive Intelligence among SMEs: Assessing the Role of Entrepreneurial Attitude Orientation on Innovation Performance. In Innovation, Finance, and the Economy, 15-22.
Molina-Morales, F.X., Martínez-Fernández, M.T., & Torlo, V.J.(2011), The Dark Side of Trust: The Benefits, Costs and Optimal Levels of Trust for Innovation Performance. Long Range Planning, 44(2), 118-133.
Morel, L., & Boly, V.(2008), Innovation Process Evaluation: From Self-Assessment to Detailed Technology Audit. In Management of Technology Innovation and Value Creation. 16th International Conference on Management of Technology.
Morris, L.(2006), Permanent Innovation. The Ackoff Center of the University of Pennsylvania.
Oviatt, B.M., & McDougall, P.P.(2005), Defining International Entrepreneurship and Modeling the Speed of Internationalization. Entrepreneurship Theory and Practice, 29(5), 537-553.
Porter, M.E.(1990), The Competive Advantage of Nations Free Press.
Raub, S.(2008), Does Bureaucracy Kill Individual Initiative? The Impact of Structure on Organizational Citizenship Behavior in the Hospitality Industry. International Journal of Hospitality Management, 27(2), 179-186.
Sankowska, A.(2013), Relationships between Organizational Trust, Knowledge Transfer, knowledge Creation, and Firm's Innovativeness. The Learning Organization, 20(1), 85-100.
Schumpeter, J.(1934), The Theory of Economic Development. Cambridge. MA: Harvard University Press.
Shany, Y.(2012), Assessing the Effectiveness of International Courts: A Goal-Based Approach. American Journal of International Law, 106(2), 225-270.
Steil, B., Victor, D. G., & Nelson, R.R.(2002), Technological Innovation and Economic Performance. Princeton University Press.
Swift, P. E., & Hwang, A.(2013), The Impact of Affective and Cognitive Trust on Knowledge Sharing and Organizational Learning. The Learning Organization, 20(1), 20-37.
Tidd, J.(2001), Innovation Management in Context: Environment, Organization and Performance. International Journal of Management Reviews, 3(3), 169-183.
Tidd, J., Bessant, J., & Pavitt, K.(2005), Managing Innovation Integrating Technological, Market and Organizational Change. John Wiley and Sons Ltd.
Van de Vrande, V., De Jong, J. P., Vanhaverbeke, W., & De Rochemont, M.(2009), Open Innovation in SMEs: Trends, Motives and Management Challenges. Technovation, 29(6-7), 423-437.
Varadarajan, R. (2011), Marketing Strategy: Discerning the Relative Influence of Product and Firm Characteristics. AMS Review, 1(1), 32-43.
Von Hippel, E. (2005), Democratizing Innovation. MIT Press.
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Amirpour, M.(2007), Sociological Survey of the Level of Social Trust of Ethnic Groups on Government Social Policies. Phd Thesis, Tehran: Islamic Azad University, Science and Research branch, (In Persian).
Nahandi, Y. B., Hassamzadeh, R. B., & Jalalifar, Z.(2014), Investigating the Relationship between Social Responsibility and the Performance of the Companies Listed in Tehran Stock Exchange. Productivity Management, 7(28), 169-164. (In Persian).
Bashirie, H.(1996), The ideology and Political Culture of the Ruling Groups in the Pahlavi Era. Journal of Philosophy & Theology, 8, 74-85. (In Persian).
Chelbi, M.(1995), Methodological Realism in Sociology. Journal of Recognition, 17, 49-70. (In Persian).
Chelbi, M.(2010), Sociology of Order: Anatomy and Theoretical Analysis of Social Order. Tehran: Ney Publication, (In Persian).
Choupani, H.(2011), Investigating the Relationship between Transformational Leadership and Organizational Innovation Trend in Alborz Insurance Joint Stock Company. Master Thesis. Tehran: University of Tehran, (In Persian).
Choupani, H., Khalili, M. Z., Ghasemi, A., & Gholamzadeh, H.(2012), An Investigation into the Relationship between Intellectual Capital and Organizational Innovation (Case: Toseeh Insurance Company). Quarterly Journal of Innovation and Creativity in Human Science, 2(1), 27-59. (In Persian).
Ghadimi, M.(2007), The Study of the Level of Social Trust and Factors Affecting it among Students of Zanjan Universities. Journal of Human Sciences, 53, 325-356. (In Persian).
Giddens, A.(1998), Essentials of Socialogy. Translated by: M. Sabouri, Tehran: Ney Publication, (In Persian).
Hosseini, A. M., & Barkhordar, B.(2007), The Relationship between Self-Management Skills and Innovation among Employees in Kerman Province Organizations. Journal of Executive Management, 7(27), 105-120. (In Persian).
Hosseini, R. N. S., & Safiri, M.K.(2002), The Effect of Organizational Entrepreneurship on Organizational Socialization and Organizational Commitment in the Employees of Physical Education Departments of Mazandaran Province. Journal of Sport Management, 6(1), 89-108. (In Persian).
Kaffashi, M., & Fathi, S.(2011), The Effect of Social and Cultural Indices on the Level of Social trust of Tehrani Citizens to Islamic Azad University. Journal of Iranian Social Development Studies, 3(2), 49-74. (In Persian).
Kafi, M.A.(2001), Social Trust and the Factors Affecting It. Journal of Research Index, 18, 9-42, (In Persian).
Keshtmand, M., & Khosravi, T.(2014), Investigating the Impact of Spatial Advantages, Organizational Resources and Organizational Capabilities on Export Strategic Performance (Case Study of Export Companies in Kermanshah). Master Thesis, Kermanshah: Islamic Azad University, (In Persian).
Pourafkari, N.(2012), Comprehensive Dictionary of Psychology-Psychiatry. Tehran:Contemporary Culture Publication, (In Persian).
Saeedi, P.(2010), Managers’ View Point with Retard to Effective Individual, Group and Organizational Factors in Creativity. Journal of Analytical-Cognitive Psychology, 2, 9-20. (In Persian).
Tabrizi, A. M., Moidfar, S., & Golabi, F.(2011), Generational Approach to Examine the Social Trust among Different Generations. Journal of Applied Sociology, 22(1), 41-70, (In Persian).
Toulaee, R.(2007), New Approaches to Organizational Performance Evaluation. Journal of Police Human Development, 12, 9-30. (In Persian).
Zarghami, H. R., Jafari, M., & Akhavan, P.(2012), The Study of Relationship between Creativity and Motivation for Innovation in Research Organizations (Case Study: Research Center of Intelligent Signal Processing (RCISP). Quarterly Journal of Innovation and Creativity in Human Science, 1(4), 37-64. (In Persian).
Ackoff, R. L., Ackoff, R. L., & Emery, F.E.(2005), On Purposeful Systems: An Interdisciplinary Analysis of Individual and Social Behavior as a System of Purposeful Events.
Agha, S., Alrubaiee, L., & Jamhour, M.(2011), Effect of Core Competence on Competitive Advantage and Organizational Performance. International Journal of Business and Management, 7(1), 192.
Aryanto, R., Fontana, A., & Afiff, A.Z.(2015), Strategic Human Resource Management, Innovation Capability and Performance: An Empirical Study in Indonesia Software Industry. Procedia-Social and Behavioral Sciences, 211, 874-879.
Anderson, J. C., & Narus, J.A.(1990), A Model of Distributor Firm and Manufacturer Firm Working Partnerships. Journal of Marketing, 42-58.
Bedarkar, M., & Pandita, D.(2014), A Study on the Drivers of Employee Engagement Impacting Employee Performance. Procedia-Social and Behavioral Sciences, 133, 106-115.
Bhuvanaiah, T., & Raya, R.P.(2015), Mechanism of Improved Performance: Intrinsic Motivation and Employee Engagement. SCMS Journal of Indian Management, 12(4), 92.
Cao, C., Xia, C., & Chan, K.C.(2016), Social Trust and Stock Price Crash Risk: Evidence from China. International Review of Economics & Finance, 46, 148-165.
Chua, R. Y., Morris, M. W., & Mor, S.(2012), Collaborating Across Cultures: Cultural Metacognition and Affect-Based Trust in Creative Collaboration. Organizational Behavior and Human Decision Processes, 118(2), 116-131.
Davila, T., Epstein, M., & Shelton, R.(2012), Making Innovation Work: How to Manage It, Measure It, and Profit from It. FT Press.
Delhey, J., & Newton, K.(2003), Who Trusts?: The Origins of Social Trust in Seven Societies. European Societies, 5(2), 93-137.
De Mozota, B.B.(2003), Design Management: Using Design to Build Brand Value and Corporate Innovation. Skyhorse Publication.
Drucker, P.(1985), Innovation and Entrepreneurship. New York: Harper & Row.
Glor, E.D.(2001), Innovation Patterns. The Innovation Journal: The Public Sector Innovation Journal, 6(3), 1-42.
Grimmelikhuijsen, S., Porumbescu, G., Hong, B., & Im, T.(2013),The Effect of Transparency on Trust in Government: A Cross‐National Comparative Experiment. Public Administration Review, 73(4), 575-586.
Hu, X., Wu, G., Wu, Y., & Zhang, H.(2010), The Effects of Web Assurance Seals on Consumers' Initial Trust in an Online Vendor: A Functional Perspective. Decision Support Systems, 48(2), 407-418.
Kanter, R.M.(2003), Challenge of Organizational Change: How Companies Experience It and Leaders Guide It. Simon and Schuster.
Klein, J.(2012), The Open-Door Policy: Transparency Minimizes Conflicts between School Principals and Staff. International Journal of Educational Management, 26(6), 550-564.
Koehn, D.(1996), Should We Trust in Trust?. American Business Law Journal, Vol. 34, 2, 183-204.
Liao, S. H., Fei, W. C., & Chen, C.C.(2007), Knowledge Sharing, Absorptive Capacity, and Innovation Capability: An Empirical Study of Taiwan's Knowledge-Intensive Industries. Journal of Information Science, 33(3), 340-359.
Maital, S., & Seshadri, D.V.R.(2012), Innovation Management: Strategies, Concepts and Tools for Growth and Profit. SAGE Publication.
Mariadoss, B. J., Milewicz, C., Lee, S., & Sahaym, A.(2014), Salesperson Competitive Intelligence and Performance: The Role of Product Knowledge and Sales Force automation Usage. Industrial Marketing Management, 43(1), 136-145.
Marsick, V. J., & Watkins, K.E.(2003), Demonstrating the Value of an Organization's Learning Culture: The Dimensions of the Learning Organization Questionnaire. Advances in Developing Human Resources, 5(2), 132-151.
Mayer, R. C., & Gavin, M.B.(2005), Trust in Management and Performance: Who Minds the Shop While the Employees Watch the Boss?. Academy of Management Journal, 48(5), 874-888.
Misztal, B.A.(1996), Trust in Modern Societies: The Search for the Bases of Social Order. Blackwell. Cambridge: Polity Press.
Mohsin, A. A., Halim, H. A., & Ahmad, N.H.(2015), Competitive Intelligence among SMEs: Assessing the Role of Entrepreneurial Attitude Orientation on Innovation Performance. In Innovation, Finance, and the Economy, 15-22.
Molina-Morales, F.X., Martínez-Fernández, M.T., & Torlo, V.J.(2011), The Dark Side of Trust: The Benefits, Costs and Optimal Levels of Trust for Innovation Performance. Long Range Planning, 44(2), 118-133.
Morel, L., & Boly, V.(2008), Innovation Process Evaluation: From Self-Assessment to Detailed Technology Audit. In Management of Technology Innovation and Value Creation. 16th International Conference on Management of Technology.
Morris, L.(2006), Permanent Innovation. The Ackoff Center of the University of Pennsylvania.
Oviatt, B.M., & McDougall, P.P.(2005), Defining International Entrepreneurship and Modeling the Speed of Internationalization. Entrepreneurship Theory and Practice, 29(5), 537-553.
Porter, M.E.(1990), The Competive Advantage of Nations Free Press.
Raub, S.(2008), Does Bureaucracy Kill Individual Initiative? The Impact of Structure on Organizational Citizenship Behavior in the Hospitality Industry. International Journal of Hospitality Management, 27(2), 179-186.
Sankowska, A.(2013), Relationships between Organizational Trust, Knowledge Transfer, knowledge Creation, and Firm's Innovativeness. The Learning Organization, 20(1), 85-100.
Schumpeter, J.(1934), The Theory of Economic Development. Cambridge. MA: Harvard University Press.
Shany, Y.(2012), Assessing the Effectiveness of International Courts: A Goal-Based Approach. American Journal of International Law, 106(2), 225-270.
Steil, B., Victor, D. G., & Nelson, R.R.(2002), Technological Innovation and Economic Performance. Princeton University Press.
Swift, P. E., & Hwang, A.(2013), The Impact of Affective and Cognitive Trust on Knowledge Sharing and Organizational Learning. The Learning Organization, 20(1), 20-37.
Tidd, J.(2001), Innovation Management in Context: Environment, Organization and Performance. International Journal of Management Reviews, 3(3), 169-183.
Tidd, J., Bessant, J., & Pavitt, K.(2005), Managing Innovation Integrating Technological, Market and Organizational Change. John Wiley and Sons Ltd.
Van de Vrande, V., De Jong, J. P., Vanhaverbeke, W., & De Rochemont, M.(2009), Open Innovation in SMEs: Trends, Motives and Management Challenges. Technovation, 29(6-7), 423-437.
Varadarajan, R. (2011), Marketing Strategy: Discerning the Relative Influence of Product and Firm Characteristics. AMS Review, 1(1), 32-43.
Von Hippel, E. (2005), Democratizing Innovation. MIT Press.
