The Influence of Contractual Governance Mechanisms, Buyer–Supplier Trust, and Supplier Opportunistic Behavior on Supplier Performance

Abstract

This article explores the influence of contractual governance mechanisms, buyer–supplier trust, and supplier opportunistic behavior on Uganda's public sector supplier performance. Many outsourced contracts are reported to frequently fail to deliver on time, budget, specifications, and quality and do not deliver value to the public. This could be attributed to poor contractual governance mechanisms, lack of buyer–supplier trust, and high levels of supplier opportunistic behavior. A cross-sectional data set collected from 632 staff of Uganda's public sector is used to validate the theoretical model and hypotheses developed from literature review. Findings reveal that contractual governance mechanisms, buyer–supplier trust, and supplier opportunistic behavior are significant predictors of public sector supplier performance. The results also suggest that supplier opportunistic behavior has a stronger influence toward supplier performance than others. The implications for these findings for future research and practice are also discussed.

Key words:

• buyer–supplier trust
• contractual governance mechanisms
• outsourcing
• public sector
• supplier opportunistic behavior
• supplier performance

Notes

*Correlation is significant at the 0.01 level (2-tailed).

*Significant at 5%.