“Do as I Do and Not as I Say”: Exploring Price‐Oriented Maverick Buying During Supplier Selection

Scott, Marc; Burke, Gerard; Szmerekovsky, Joseph G.

doi:10.1111/deci.12262

Cited by 10 publications

(11 citation statements)

References 100 publications

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“…The proposed model and methodology are aligned with the claims of the literature. Indeed, TCO is presented as the most comprehensive and an efficient methodology to recognize all costs of the product highlighting the entire value chain [23,47]. The application of TCO in the agribusiness context has several examples which highlight its life cycle perspective, focus on the acquisition of inputs, and investment projects [31,44], respectively.…”

Section: Discussionmentioning

confidence: 99%

“…Table 1 presents the different applications of TCO, which can be extended for application in the agribusiness. [31,36,37,40,45,46] According to Scott et al [47], TCO is the most comprehensive tool to obtain the total cost of inputs and services, in which all aspects related to the life cycle and maintenance costs are considered. Indeed, some authors claim that TCO has proven to be an efficient methodology to recognize all costs considering the entire company's value chain [23].…”

Section: Cost Management and Tco In Family Farmingmentioning

confidence: 99%

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Combining Total Cost of Ownership and Multi-Criteria Decision Analysis to Improve Cost Management in Family Farming

2021

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Family farming is an important pillar of the global primary food sector and is characterized by a significant local and regional impact. The sustainability of these businesses depends greatly on the use of effective management practices in family farming and smallholder farmer’s activities. However, there is a lack of methodologies to support decision making in this sector related to the recognition of all aspects involved in the acquisition of inputs. Commonly, the existing approaches are focused on cost as the major criterion, which might impact on the agribusiness sustainability in the short or long term. Furthermore, traditional cost-focused approaches should be complemented with multi-criteria aspects within comprehensive and practical methodologies. This paper presents a Cost Management Model (CMM) integrating the concepts of Total Cost of Ownership (TCO) and Multiple Criteria Decision Analysis (MCDA), which includes both monetary and non-monetary attributes. The use of TCO was mostly focused on industrial applications and studies on costs in agribusiness are still scarce and incomplete. The model was applied to a set of agribusiness families in Southern Brazil to support the supplier selection process of the three main inputs (i.e., fertilizer, fungicide, and soybeans). A significant cost reduction of approximately 13% for fertilizers, 7% for fungicides, and 3% for soybeans can be achieved. The CMM can be applied by smallholder farmers in any region of the world, and its flexibility allows changes in weights and criteria at any time by the decision maker. Buyers are more prepared to select the best supplier for each input and the later can recognize how they are more or less competitive when all costs and relevant criteria are taken into consideration. It can be also applied from an industry-level perspective to highlight the industry’s cost structure and value chain, supporting more focused and effective public policies namely the design of subsidies that mitigate relevant context costs and the investment in infrastructures. Both, subsidies and public investment, are of major importance in rural areas of developing countries.

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Section: Discussionmentioning

confidence: 99%

Section: Cost Management and Tco In Family Farmingmentioning

confidence: 99%

Combining Total Cost of Ownership and Multi-Criteria Decision Analysis to Improve Cost Management in Family Farming

2021

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“…There needs to be a willingness from the end of the supplier to use the enhanced connectivity to share the information to reap maximum benefits (Fawcett et al, 2007;Kurnia et al, 2015). The technical capability of the supplier plays an important role when we on-board a new supplier (Scott et al, 2018). When the firm aims to implement procurement 4.0, there must also be an evaluation to check if the supplier is technically equipped to collaborate.…”

Section: Cultural Changementioning

confidence: 99%

Procurement 4.0 to the rescue: catalysing its adoption by modelling the challenges

Jerome

Saxena

Sonwaney

et al. 2021

BIJ

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PurposeThe pandemic crisis has resulted in global chaos that had caused massive disruption to the supply chain. The pharmaceutical industry, in particular, has been working tirelessly to ensure that they can cater to the people who need them. With restrictions being imposed to prevent the spread of the COVID-19 virus, the movement of raw materials required has been affected, thus creating the need for the procurement function to be innovative. This study proposes the application of Industry 4.0 concepts into the procurement activities of an organization to make it more resilient and efficient.Design/methodology/approachTo study the intensity of the challenges, Total Interpretive Structural Modelling is used alongside the “Matrice des Impacts Croises Multiplication Appliquee a un Classement” (MICMAC) technique.FindingsResilience can be achieved through the collaboration between the organization and its network of suppliers. This is however easier said than done. High and unclear investments have been identified as the challenge that is taking a toll on all technological investments in the pandemic era. The study also shows that organizational inertia which is present in established and structured firms are a deterrent as well.Originality/valueThis study is based on the application of procurement 4.0 to ensure that pharmaceutical supply chains stay least affected since they are essentials. This study using a multi-criteria decision-making approach to prioritize the challenges. This will help practitioners make decisions faster.

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“…Choi and Hartley (1996), for example, included "long-term relationship" and "relationship closeness" as two supplier selection criteria in their criteria list. According to Scott et al (2018), "performance history" is one of the most important criteria considered by industry experts when selecting suppliers. Research on supplier switching has also delved into selecting a new supplier to replace an incumbent supplier.…”

Section: Supplier Selection Criteria and Modelsmentioning

confidence: 99%

Supplier selection in the aftermath of a supply disruption and guilt: Once bitten, twice (not so) shy

2021

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The supply management literature assumes that supplier selection is devoid of emotions and unaffected by the history and experience associated with a previously-selected supplier. In this paper, we relax these assumptions. Specifically, we consider the following sourcing opportunity: a sourcing professional had (alternatively, had not) recommended a critical-component supplier that originated an avoidable (alternatively, unavoidable) supply disruption (aka, the "disrupted supplier"). In the aftermath of this supply disruption, the sourcing professional is asked to recommend a supplier for a new-to-beoutsourced critical component (i.e., one unrelated to the component whose flow was interrupted), taking into consideration the influence of guilt as an emotional reaction to the supply disruption. Analyses of data from 286 sourcing professionals participating in a scenario-based, roleplaying experiment reveal that sourcing professionals experience higher levels of guilt when (a) they (versus their predecessor) had been responsible for selecting a disrupted supplier and (b) they deem the supply disruption to be controllable (versus uncontrollable) by the disrupted supplier. Guilt-laden sourcing professionals are then more likely to recommend a riskier albeit more advantageous supplier for a new-to-be-outsourced critical component. Our results provide the first evidence that prior supplier selection decisions gone awry influence future supplier selection decisions through the emotion of guilt. Moreover, they demonstrate that supply disruptions in one context have carryover effects on future sourcing decisions in unrelated contexts-an insight that is absent from the literature on supply disruptions.

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“Do as I Do and Not as I Say”: Exploring Price‐Oriented Maverick Buying During Supplier Selection

Cited by 10 publications

References 100 publications

Combining Total Cost of Ownership and Multi-Criteria Decision Analysis to Improve Cost Management in Family Farming

Combining Total Cost of Ownership and Multi-Criteria Decision Analysis to Improve Cost Management in Family Farming

Procurement 4.0 to the rescue: catalysing its adoption by modelling the challenges

Supplier selection in the aftermath of a supply disruption and guilt: Once bitten, twice (not so) shy

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