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The impact of power balances and trust on modal shift possibilities
Linköping University, Department of Management and Engineering, Logistics & Quality Management. Linköping University, Faculty of Science & Engineering.ORCID iD: 0000-0001-8969-9396
SSAP.
SSAP.
2019 (English)Conference paper, Oral presentation with published abstract (Other academic)
Abstract [en]

Purpose

For logistics to become environmentally sustainable, modal shift from road to more energy-efficient alternatives, such as rail and sea, is needed. Power balances and trust between actors may drive and hinder the collaboration needed to induce change. The purpose is to increase the understanding of how power balances and trust between shippers and transport providers influence a change from road to more environmentally sustainable modes of transport.

Design/methodology/approach

This paper combines theoretical perspectives with preliminary interviews with both shippers and transport providers involved in modal shift. Theoretically, it builds on change management principles and two inter-organisational perspectives, namely power and trust.   

Findings

The results suggest that power balances and trust do indeed have an influence on the probability of modal shift possibilities, albeit they have different impact during the different phases of change.

Research limitations/implications (if applicable)

This paper is mainly conceptual, but draws on insights from preliminary interviews with shippers and transport providers. Case studies of companies or dyads that have changed from road to rail or sea would be fruitful to validate the findings presented in this abstract.

Practical implications (if applicable)

Actors, whether being transport providers or shippers, that want to initiate a change toward modal shift, can benefit from the findings. Specifically, they illuminate power bases and different forms of trust that can have a direct impact on modal shift being realised or not.

Original/value

Contrary to previous research, this paper offers a novel perspective of modal shift by analysing power balances and trust between transport providers and shippers.

Keywords: Modal shift, power bases, environmentally sustainable logistics, supply chain collaboration.

 

1. Purpose of this paper

For logistics to become environmentally sustainable, modal shift from road to more energy-efficient alternatives, such as rail and sea, is needed (Regeringskansliet, 2018). This is a preferable choice in the direction of reducing both climate impact from transportation, as well as congestion on roads. Since de-speeding logistics is found to be a cost-effective way to decrease CO2 emissions (McKinnon, 2016), rail and sea transport should be an attractive option for companies striving towards environmental sustainability.

In the light of this, it is somewhat discouraging to find that a shift on modes from road to rail and sea is slow. One reason for this slow progress is that decisions regarding which mode of transport to use are not taken by individual actors. On the contrary, several actors influence the decision, which makes the decision-making process more complicated. Key actors are companies sending and receiving goods (shippers) and transport providers, that arrange and execute the transport. This paper takes its starting-point in these two groups of actors: the shipper and the transport provider. Shippers are of large relevance as they are the ones with a demand of transports and with requirements linked to these. Influencing factors underlying the choice of transport are cost, transport quality, transport time and reliability (Flodén et al., 2017). Transport providers, on the other hand, respond to shippers demands, as a majority of shippers sub-contract their transport operations through a third party (Lammgård and Andersson, 2014). 

To obtain modal shift in shippers’ supply chains to a larger extent, change is needed. Such change requires the participation of both shippers and transport providers and interaction between them is a prerequisite for success. Two critical change management principles, influencing the interaction between actors, are power and trust. Power balances between actors may both drive and hinder the collaboration necessary to induce change. At the same time, trust is likely to be of importance as an enabler for modal shift. The purpose of this paper is to increase the understanding of how power balances and trust between shippers and transport providers influence a change from road to more environmentally sustainable modes of transport.

2.  Design/methodology/approach

This paper combines theoretical perspectives with preliminary interviews with both shippers and transport providers involved in modal shift. Theoretically, it builds on change management principles and two inter-organisational perspectives, namely power and trust. Firstly, organisational change can be divided into three phases: unfreeze, change and refreeze (Fawcett et al., 2012). In this paper, two of these phases – the unfreeze and refreeze phase - are in focus, as they are the ones where power and trust are most likely to influence the potential for modal shift.

 

Power is suggested to entail "the ability to evoke a change in another's behavior" (Gaski, 1984, p. 10). Power is relationship-specific and an actor with high power over another in one relationship, might be at a power disadvantage in another relationship. Power can be said to stem from power bases possessed by the actors in a relationship. A commonly applied framework for such bases is the one suggested by French and Raven (1959), who propose five power bases: reward, coercive, expert, referent and legitimate power. Reward power means an ability to mediate rewards to a target actor; coercive instead includes punishment to that target; expert power means a skill or knowledge desired by the target; referent power occurs when the target values identification with the source, and; legitimate power entails a belief by the target that the source has a natural right to influence. In addition to these five power bases, supply chain position is suggested to be of relevance and not covered by French and Raven (1959). According to Kähkönen and Lintukangas (2010), customers often have power over suppliers.

 

Trust can be defined as “an expectation held by an agent that its trading partner will behave in a mutually acceptable manner” (Sako and Helper, 1998, p. 388). According to Sako (1992), there are three different types of trust: contractual, competence and goodwill. Contractual trust means a belief that collaborating actors will stay true to the contract, while competence trust entails a belief that a collaborating actor has the ability to conduct specific tasks. Finally, goodwill trust occurs when actors are willing to exceed the expected contractual agreements. The three types of trust can be said to be levels of trust, where contractual trust is the lowest level, but as relationships develop, trust also can develop and turn into competence trust or goodwill trust.

 

Empirically, the paper relies on preliminary findings from interviews with shippers and transport providers. The interviews have focused on actor collaboration for modal shift to take place and have identified both possibilities and difficulties in the different stages of change that modal shift entails.

3.  Findings 

The results suggest that power balances and trust do indeed have an influence on the probability of modal shift possibilities, albeit they have different impact during the different phases of change. In the unfreeze phase, the initiating actor needs to have power advantage over the other actor, as this appears to be necessary for change to take place. In other words, modal shift does not appear to happen by itself, and therefore some degree of power advantage is needed. The power advantage appears to derive mainly from expert power, coercive power or supply chain position. Interestingly, these power bases can be of different relevance depending on whether the initiating actor is the transport provider or the shipper in a relationship between the two actors. Further, some level of trust between the transport provider and the shipper is needed, but especially in the case of new relationships, this trust is not likely to be more than in the form of contract trust.

 

As change has been done and the next step is the refreeze phase, the challenge lies in maintaining the model shift. Here, trust becomes of higher importance than power. If competence trust or even goodwill trust have developed, there is high likelihood of a long-term change. However, if trust has not developed and sufficiently, there might instead be a high likelihood of the change to sustain.

4.  Research limitations/implications

This paper is mainly conceptual, but draws on insights from preliminary interviews with shippers and transport providers. Case studies of companies or dyads that have changed from road to rail or sea would be fruitful to validate the findings presented in this abstract. 

5.  Practical implications

Actors, whether being transport providers or shippers, that want to initiate a change toward modal shift, can benefit from the findings. Specifically, they illuminate power bases and different forms of trust that can have a direct impact on modal shift being realised or not.

6.   Originality/value  Contrary to previous research, this paper offers a novel perspective of modal shift by analysing power balances and trust between transport providers and shippers.

Place, publisher, year, edition, pages
2019.
National Category
Transport Systems and Logistics
Identifiers
URN: urn:nbn:se:liu:diva-158471OAI: oai:DiVA.org:liu-158471DiVA, id: diva2:1333629
Conference
31ST NOFOMA CONFERENCE, Oslo, Norway, 12-14 June, 2019
Funder
Swedish Energy Agency, 46953-1Available from: 2019-07-01 Created: 2019-07-01 Last updated: 2019-08-30Bibliographically approved

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