The role of e-procurement in purchasing management

This exposition summarises research published in several academic articles, in order to meet the requirements of PhD by publication. The focus of the work is on the role of electronic procurement in management of the purchasing function. From the late 1990s a number of independent e-procurement mechanisms were launched which offered potential benefits such as increased order accuracy, transaction efficiency and greater integration between trading partners. At the outset of this programme of research, e-procurement was therefore an emerging phenomenon with little academic research and presented an opportunity to investigate a largely unexplored area. Edmondson and McManus (2007) suggest that for nascent, as opposed to mature areas of research, where few formal constructs or measures exist, an exploratory, qualitative approach is required. This research followed such an approach through the use of case studies, involving observation, participation and interviews with key organisational actors. Each paper makes use of several cases in order to compare and contrast results from different organisations and to draw conclusions from multi-case analysis. The published articles focus on the impact of core applications within e-procurement, including online reverse auctions, electronic marketplaces, online catalogue sites, and buying systems covering the ‘requisition to pay’ cycle. The findings from the papers address a number of core themes in purchasing management. In considering buyer-supplier relationships, it was observed that such dyads are driven by traditional buyer negotiation factors such as segmentation, power and price and that use of eprocurement applications tended to enforce such traditional behaviours. In relation to the potential for integration, the study found that integration between firms was barely affected, as the concept of integration was neither an objective nor a business case driver for e-procurement adoption. This situation reflects the finding that procurement managers pursue functional targets rather than supply chain-level objectives. However, other significant effects from e-procurement adoption were noted such as the tendency by buyers to reduce supplier numbers and a move to re-engineer the procurement function in buying firms, through automating transactional processes. The research finds that e-procurement does not have a deterministic impact on purchasing management, and that it acts as an enabler to more effective management of the function though the way its different mechanisms are deployed. The exposition establishes that e-procurement is used in relation to supply conditions which are characterised by both ‘markets’ and ‘hierarchies’, but that it is the predefined purchasing strategy of the firm, rather than available technology solutions, which determines when markets and hierarchies are used. Additionally, an original model is introduced, focusing on developing an e-procurement policy which can support strategic purchasing goals. This model extrapolates findings from stages in the research, and marries together elements from various papers and frameworks therein, to produce some guidelines for adoption of this technology

Electronic Business (EB) in the Context of Global Sourcing: A Proposed Framework

Global sourcing operates under the challenges and pressures of intensive global-wide competition. Global sourcing can benefit from the functionality of electronic business (EB) by exhibiting more flexible structures and added opportunities in communications and transactions with partners among worldwide supply chains/networks. This study aims to answer two research questions, “what are the relationships between global sourcing and EB?” and “how do EB applications and strategies help global sourcing lead to better performance?” Our literature review addresses the relationships between global sourcing and EB from three perspectives: the applied theories, the covered business scope, and the changing roles of flows. In analyzing the potential benefits of EB to global sourcing, the enhancement on SC components and alignment effects are discussed. Finally, a framework is proposed to highlight how EB and global sourcing interact with each other, resulting in five major issues: the enhancement of SC components, the changing micro-environment, the effect of accelerating evolution of global sourcing, the integration of activities, and the significant improvement on outcomes

Vendor Firm Characteristics and Buyers\u27 Perceptions of Transaction Costs and Relationship Governance

The utilization of outsourced business services continues to grow as organizations focus on core competencies. Outsourced services span the gamut from financial services to information processing to engagement of third party logistic services by enterprise customers. When outsourcing business services, organizational buyers often have to select from a plethora of small, mid-sized, and large vendors that offer competing services at comparable prices. Given this choice conundrum, what factors influence buyers’ perceptions of vendors and their capacity to deliver expected value? The current research integrates three distinct, yet related, theoretical streams including transaction cost, vendor selection, and buyer-seller relational exchange in studying how vendor firm attributes affect buyers’ perceptions of the vendor as well as their willingness-to-engage in a particular type of relationship exchange with the vendor. Two separate, but conceptually-related essays are offered to add some clarity to variables influencing vendor assessment and selection. Essay 1 introduces vendor firm attributes as antecedents to the opportunism and uncertainty constructs thereby extending the transaction cost research. Specifically, Essay 1 examines how vendor firm size and reputation influence organizational buyers’ a priori perceptions of vendor opportunism and uncertainty. Essay 2 examines the influence of buyers’ opportunism and uncertainty perceptions on their relationship governance choices. Concomitantly, Essay 2 studies how opportunism and uncertainty perceptions on the part of the buyer mediate the relationship between vendor firm characteristics and buyers’ willingness-to-engage in contractual and relational exchange/governance with a given vendor. A panel of IT buyers, across various industries, was surveyed to determine the impact of vendor attributes on buyers’ perceptions of opportunism and technological uncertainty associated with the vendor. In addition, the survey also tested the relationship between buyers’ perceptions of vendor opportunism and uncertainty and their willingness-to-engage in legal contracts/bonds and relational exchange with the vendor. Results support the linkages between vendor firm reputation and buyers’ perceptions of opportunism and technological uncertainty. Moreover, a direct linkage was found between vendor firm reputation and buyers’ relationship preferences. Implications are discussed along with limitations and areas of future research

Electronic procurement: dealing with supplier adoption

E-procurement systems make purchasing activities more effective in terms of both time and cost. However over the past years there is evidence that some of the expected benefits have not been achieved. Among several appointed causes, supplier‟s adherence to such platforms has been regarded as one. The focus of this research is in supplier adoption of e-Procurement. Such a study is important in order to better address the issues actually faced by suppliers within e-Procurement. We have conducted a questionnaire-based survey to 721 Portuguese companies and performed an empirical analysis of the results. The findings from this work provide empirical evidence that the supplier perceived benefits and business partner pressures are positively related to e-Procurement adoption while some barriers like implementation costs have the opposite effect. The main critical success factors on e-Procurement adoption are also presented.Os sistemas de e-Procurement permitem melhorias significativas no tempo e custo associados aos processos de compra. No entanto, nos últimos anos existe evidência de que alguns dos benefícios esperados não têm sido alcançados. Entre as várias causas apontadas, a falta de adesão dos fornecedores a esse tipo de plataformas foi apontada como uma. O foco desta pesquisa está na adopção dos fornecedores ao e-Procurement, mais especificamente nos factores que levam a sua adesão. Foi realizado um questionário a 721 empresas Portuguesas e os dados obtidos analisados. Os resultados deste trabalho fornecem evidências de que os benefícios percebidos pelos fornecedores e as pressões dos parceiros de negócios estão positivamente relacionados com a intenção de adopção, enquanto algumas barreiras, como custos de implementação têm o efeito oposto. Os principais factores críticos de sucesso na adesão ao e-Procurement são também apresentados

Purchasing consortia and electronic markets:a procurement direction in integrated supply chain management

In supply chain management literature, there has been little empirical research investigation on purchasing consortium issues focusing on a detailed analysis of information and communication (ICT) based procurement strategies. Based on the exploration of academic literature and two surveys among purchasing organisations as well as e-Marketplaces / procurement service providers (PSPs) in the automotive and electronics industry sectors, the research methodology follows a positivistic approach in order to assess the overall statement: ‘Effective participation in electronic purchasing consortia (EPC) can have the potential to enhance competitive advantage. Implementation therefore requires a clear and detailed understanding of the major process structures and drivers, based upon thetechnology-organisation-environment framework.’ Key factors and structures that affect the adoption and diffusion of EPC and the performance impact of adoption are investigated. The empirically derived model for EPC can be a valuable starting point to EPC research

Predicting intention to adopt B2B electronic commerce in Jordan: The moderating role of trust and dependency

Business to Business Electronic Commerce (B2B EC) has great potentials to extend firms’ competency and efficiency. As such, Jordan has an objective to increase the diffusion of this technology. Despite extensive government efforts, the adoption of B2B EC is still limited. Consequently, there have been extensive efforts to better understand the phenomena. Yet, documented findings regarding the determinants of the adoption are not altogether consistent. To provide more insight, this study developed a research model utilizing the Technological, Organizational, and Environmental (TOE) framework to identify the determinants of the firms’ propensity to adopt B2B EC. Since B2B EC is an inter-organizational phenomenon supporting transactions of partnerships, this study emphasizes the context of partnership characteristics. Grounded on inter-organizational theories, this study hypothesized that partnership characteristics, namely trust and dependency, moderate the role of TOE motivating factors. Moreover, given that B2B EC is used on both sides of the buyer/seller relationship, this study examined the differences and similarities in the perception of the marketing and purchasing departments regarding the determinants of the B2B EC adoption. A total of 798 questionnaires were self administrated to marketing and purchasing managers in 462 firms that have large registered capital in Jordan. In total, 114 marketing and 125 purchasing managers participated in this study. Marketing and purchasing responses were analyzed separately using the Partial Least Squares approach. The result revealed that the marketing and purchasing departments do have different views regarding the determinants of the adoption, specifically in terms of the role of Relative Advantage and Competition Pressure. Moreover, the results showed that the moderating role of trust was less pronounced. Meanwhile, the moderating role of dependency was partially supported particularly in the purchasing perspective. These findings have demonstrated how dependence asymmetries between trading partners may change the adoption motivations. They further explain the importance of considering the views of the business partner for the adoption to be done successfully

Purchasing Consortia and Electronic Markets: a Procurement Direction in Integrated Supply Chain Management

In supply chain management literature, there has been little empirical research investigation on purchasing consortium issues focusing on a detailed analysis of information and communication (ICT) based procurement strategies. Based on the exploration of academic literature and two surveys among purchasing organisations as well as e-Marketplaces / procurement service providers (PSPs) in the automotive and electronics industry sectors, the research methodology follows a positivistic approach in order to assess the overall statement: ‘Effective participation in electronic purchasing consortia (EPC) can have the potential to enhance competitive advantage. Implementation therefore requires a clear and detailed understanding of the major process structures and drivers, based upon thetechnology-organisation-environment framework.’ Key factors and structures that affect the adoption and diffusion of EPC and the performance impact of adoption are investigated. The empirically derived model for EPC can be a valuable starting point to EPC research