Business‐to‐business e‐procurement: success factors and challenges to implementation

Abstract

Purpose -The paper seeks to pursue the understanding of current business-to-business e-procurement practices by describing the success factors and challenges to its implementation in the corporate setting. Design/methodology/approach -Members of the Institute for Supply Management and the Council of Logistics Management were asked to respond to a survey questionnaire. Factor analysis was used to analyze data from valid responses received from 185 firms. Findings -Factor analysis resulted in three e-procurement success factors (SF):supplier and contract management; end-user behavior and e-procurement business processes; and information and e-procurement infrastructure. Three challenge-to-implementation factors (CIF) also emerged: lack of system integration and standardization issues; immaturity of e-procurement-based market services and end-user resistance; and maverick buying and difficulty in integrating e-commerce with other systems. Research limitations/implications -A representative sampling design should be used in the future to be able to make claims for generalizable results. Practical implications -E-procurement is a very important initiative with significant cost savings potential for firms. This study's findings can guide various stages of corporate implementation efforts. Originality/value -This study fulfills the need for solid empirical findings on this very important topic that has a direct impact on a firm's bottom line. E-procurement is still in the early stages of marketplace deployment and guidance is still needed on how to do it right.

E-procurement and its impact on supply management – evidence from industrial case studies

“…The problem of non-compliance is also referred to as eliminating 'maverick' spending - Corini (2000) refers to a report by Deloitte Consulting in which controlling maverick spending was cited as a principal benefit of eprocurement. Angeles & Nath (2007) found that implementing an e-procurement system did not necessarily eliminate the problem of maverick buying. However this maverick spend, if not addressed, will reduce the bargaining power of buyers (de Boer et al, 2002).…”

“…In relation to e-procurement, Carr & Smeltzer (2002: 294) emphasise that: 'the changing nature of buyer-supplier relationships, as the use of information technology becomes more important, has not been investigated'. Indeed, as a newly-emerging phenomenon, e-procurement is only now being explored in depth and a growing body of literature is emerging covering issues such as benefits and disadvantages, adoption, implementation, governance, and costs (Croom, 2000;Tatsis et al, 2006;Angeles & Nath, 2007). The emphasis in this paper is on the impact of e-procurement usage on supply management, which will be the focus of this literature review.…”

“…Angeles & Nath (2007) found that system integration was one of the major challenges to successful e-procurement implementation. Incompatibility of systems may also be a barrier to close integration with suppliers (McIvor & Humphreys, 2004).…”

“…It is suggested by Corini (2000) that buyers should reduce supplier numbers first, before embarking on an e-procurement project, as this reduces implementation cost and effort. One of the key drivers reported in a number of studies of e-procurement implementation has been the opportunity to reduce suppliers numbers and create spend leverage (Smart, 2008;Angeles & Nath, 2007;Min & Galle, 2001). Quayle (2005) points out that if the supply base reduces with e-procurement use, then SME suppliers will be faced with meeting international standards which may lead to deficiencies in, and risks for, the supply chain.…”

An Integrative Approach to Inter-organizational System Implementation and Evaluation: the Case of Government-to-Business

“…At present, these technologies, better known as interorganizational system, have been widely deployed not only in private organizations that form partnership (Angeles and Nath, 2007), but also in public sector as a mean to improve their service delivery (Ahmad and Othman, 2007).…”