George A. Zsidisin

Environmental purchasing: a framework for theory development

Abstract This paper examines environmental research in the supply chain management literature in order to establish a framework for current and future development of environmental purchasing theory. As the purchasing function takes on a more strategic role in forming trading partnerships with others in their supply chains, it is in a critical position to influence responses to concerns about the natural environment. Definitions of environmental supply chain management and environmental purchasing are offered and the literature is reviewed. Linkages of environmental purchasing with transaction cost analysis are established and future research is described to enhance the study of purchasings ability to effect the natural environment.

An analysis of supply risk assessment techniques

Purchasing organizations are exposed to risk in their interactions with suppliers, whether it is recognized and managed, addressed in a cursory manner, or altogether ignored. In order to understand the supply risk that exists, purchasing organizations can proactively assess the probability and impact of supply risk in advance, or reactively discover risk after a detrimental event occurs. The purpose of this study is to explore, analyze, and derive common themes on supply risk assessment techniques. Findings from this research indicate that purchasing organizations can assess supply risk with techniques that focus on addressing supplier quality issues, improving supplier processes, and reducing the likelihood of supply disruptions. From an agency theory perspective, these risk assessment techniques facilitate the obtaining of information by purchasing organizations to verify supplier behaviors, promoting goal congruence between buying and selling firms, and reducing outcome uncertainty associated with inbound supply.

Purchasing organization involvement in risk assessments, contingency plans, and risk management: an exploratory study

Purchasing organizations use various strategies and techniques to minimize the chance and impact of detrimental events occurring in the supply base. Supply risk assessments are a necessary first step in managing those risks. An analysis of in‐depth interviews with purchasing professionals from nine companies indicates that purchasing organizations often create contingency plans, and implement process‐improvement and buffer strategies in response to perceived supply risks discovered in assessments. Even though risk assessments, contingency plans, and risk management efforts are generally acknowledged as being important, many of those interviewed believed that there was not enough done in their organizations to mitigate supply‐related risks.

An institutional theory perspective of business continuity planning for purchasing and supply management

Supply chains are increasingly susceptible to unplanned, unanticipated disruptions. With the implementation of the practices of lean systems, total quality management (TQM), time-based competition and other supply chain improvement initiatives, managers now realize that their supply chains are fragile, particularly to environmental disruptions outside their control. As a result of recent events including 11 September 2001, a system is now emerging in purchasing to manage supply risk characterised as having a very low probability of occurrence, difficult to predict, and with a potentially catastrophic impact on the organization. This paper presents case study research findings examining how and why firms create business continuity plans to manage this risk. Propositions are then presented from an institutional theory perspective to examine how various isomorphic pressures result in firms having similar risk management practices embedded in their supply management practices over time.

Activities related to purchasing and supply management involvement in supplier alliances

Many firms have experienced significant benefits from engaging in supplier alliances. However, alliance relationships do not evolve in isolation. Support factors for supplier alliances include purchasing’s accountability for their actions, the use of information technology, the perceived importance of the purchasing and supply management (PSM) function, and the degree of participation in strategic purchasing activities. In addition, PSM engages in cost and price‐related activities associated with supplier alliances, including total cost of ownership, understanding specific supplier costs, target costing, and market monitoring. Empirical results from a survey indicate that significant relationships exist between support factors, cost and price activities, and supplier alliance involvement by the PSM function. The exploratory findings suggest that support factors must be in place and continually improved to facilitate purchasing’s involvement in alliances. PSM involvement in cost and price activities is also strongly related to supplier alliance participation. For purchasing firms to obtain long‐term benefits from alliances with suppliers, purchasing professionals must continually provide valuable input into these relationships through their corporate influence, use of information technology, and participation in various proactive purchasing activities.

Antecedents and Outcomes of E-Procurement Adoption: An Integrative Model

Organizations increasingly emphasize the use of information technology in the procurement process. An integrative model of e-procurement adoption that captures its antecedents, two types of e-procurement use, and their respective effects on relationship development and perceived efficiency gains are proposed and empirically tested using the data collected from senior managers in four technology-intensive industries. Our findings indicate that the use of coordination e-procurement applications has both direct and indirect effects on perceived efficiency gains, while transactional application use can directly lead to efficiency gains. In addition, the use of e-procurement applications is strongly influenced by organizational learning ability and normative pressures. The findings provide a new perspective for managers in their future implementation of e-procurement applications.

Factors that drive purchasing and supply management's use of information technology

Purchasing and supply leaders continually search for ways to improve the quality, delivery, and cost of production inputs. Their participation in these proactive supply chain activities can be a significant driver of purchasing and supply managements use of information technology (IT). Using a transaction cost analysis perspective, we surveyed purchasing and supply professionals at the director level or above from the Institute for Supply Management database to determine whether five common purchasing activities increase the need for purchasing professionals to use IT. The purchasing activities studied are (1) supplier alliance; (2) market monitoring; and (3) cost management (including cost analysis, total cost of ownership, and target costing). Of these activities, supplier alliances and cost analysis were found to significantly influence purchasing and supply management use of IT. In addition, industry effects were also discovered, where purchasing professionals in organizations that focus on producing high technology products and services utilize IT to a greater extent than purchasing professionals in traditional manufacturing and service organizations. The findings suggest that while there is evidence of a relationship between purchasing and supply managements participation in proactive activities and actual use of IT, more research is needed to understand how information and technology can better facilitate purchasing and supply management activities.

On the benefits and risks of focused commitment to suppliers

This paper discusses the merits of purchasing firms of pursuing a focused commitment strategy (FCS) with suppliers. An FCS involves committing long-term investments with a limited number of suppliers to achieve superior performance. Drawing upon transaction cost theory, agency theory and the knowledge-based view, a basis is provided for comparisons of the benefits and risks of such a strategy. Using data gathered from 224 US manufacturing firms, support for the hypothesized trade-offs associated with an FCS is examined. The findings support such trade-offs, suggesting that operational benefits accrue from increasing levels of focused commitment beyond unfocused levels — but only up to a point. The results indicate that firms pursuing above-average levels of focused commitment may be subject to risks that offset transactional and scale-related benefits. Detriments from too much focused commitment erode the firms manufacturing-based competitive performance. In addition, the evidence indicates that profitability and market share growth also suffer. The paper discusses the implications of these findings for managers and for future research.

An empirical investigation of the metrics alignment process

Purpose – To understand the use of metrics to attain alignment between the needs of the customer, strategic objectives, and the execution system. This paper examines the process by which metrics at the various levels are developed and the factors affecting this process.Design/methodology/approach – The paper draws on a series of “deep” case studies and 45 interviews of key managers at various levels within three related businesses. Open and axial coding on the data was performed and themes reported.Findings – The findings show how metrics can generate two types of synergy, financial, and strategic and that numerous factors affect metrics deployment and alignment. There also exists a tension between those metrics that encourage sales growth through innovation and market development (i.e. the so‐called top line metrics) and those metrics that reduce costs or asset investments (i.e. bottom line metrics).Research limitations/implications – Selective coding of the data to develop theoretical insight has yet to...

Supply risk perceptions and practices: an exploratory comparison of German and US supply management professionals

Due in part to recent tragedies such as the terrorist events of September 11 and the widespread effects of Hurricanes Rita and Katrina, there has been a growing body of research examining supply risk and supply disruptions. However, to date, most of these studies have either relied on qualitative tools for better understanding risk, or have created simulations to replicate the effects of these disruptions. Further, most of these studies have focused on specific company practices or the viewpoints from a single country or culture. To address this research gap, the purpose of this exploratory study is to examine the effects of supply disruption occurrence, how supply risk is perceived and managed, and if differences exist between supply management professionals from the USA and Germany. The preliminary findings indicate that some differences in risk perceptions and management do exist between US and German supply management professionals, which may be explained, in part, from cultural orientation and practices.