Linking Purchasing to Corporate Competitive Strategy

Watts, Charles A.; Kim, Kee Young; Hahn, Chan K.

doi:10.1111/j.1745-493x.1992.tb00575.x

Cited by 134 publications

(152 citation statements)

References 6 publications

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“…Integration in procurement focuses on internal orientation, which aims to align procurement practices with competitive priorities of the company. The procurement integration in the manufacturing and corporate strategy has been discussed into several conceptual frameworks, one of which is framework from existing research [22]. They emphasize the importance of procurement in the business strategy formulation and implementation.…”

Section: Connection Of Procurement Procedures With Competitive Stratementioning

confidence: 99%

Procurement Practices in Project Based Manufacturing Environments

Shah

Hasan

2016

MATEC Web Conf.

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Abstract. Procurement is one of the processes that cannot be separated in a business. To be able to run a business, it certainly needs to go through procurement stage that involves purchasing raw materials and services. There are many procurement practices in different kinds of business environment such as manufacturing business and construction business. Competitive strategies application within procurement in this manufacturing is very important in order to win a tender for material procurement required in projects. The paper examines how competitive strategies are applied within procurement practice in project-based manufacturing environment. This research studies in the literature of management in engineering, competitive strategy, procurement integration, and case study that takes a sample from the examples of procurement practice application in large organisation such as that of McDermott. The research aims to conduct a qualitative research method based on the discussion and analysis of literature reviews and case study to build conclusions. The findings suggest business players should have core competencies and develop factors such as superior quality, price advantage, on-time delivery, flexibility, and innovation through technology in order to win the competition.

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Section: Connection Of Procurement Procedures With Competitive Stratementioning

confidence: 99%

Procurement Practices in Project Based Manufacturing Environments

Shah

Hasan

2016

MATEC Web Conf.

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“…Watts et al (1995) hypothesize that parallel and dual sourcing lead to the best purchasing results in cases of service buying and in high-tech markets. Single sourcing would be the best alternative in innovative technology contexts and expertise-oriented settings.…”

Section: Literature Reviewmentioning

confidence: 99%

Insights into the process of changing sourcing strategies

Faes

Matthyssens

2009

Journal of Business &Amp; Industrial Marketing

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Purpose -The aim of this article is to identify the motivations driving the process of changing sourcing strategy from single sourcing to multiple sourcing or vice versa. Design/methodology/approach -Ten cases of sourcing strategy change were investigated. A qualitative research method is used to uncover the richness of these change processes. Findings -Most of the advantages and disadvantages stated in the literature were confirmed. Identical objectives (cost cutting and quality improvement) were present in all cases, although changes took place in opposite directions. Contextual factors, such as standardisation and supplier base reduction efforts shape purchasing strategy more than previously thought. The dynamic nature of the product lifecycle also seems to be an important determinant.Research limitations/implications -Although the results of qualitative case study research can only be "generalised" in a limited way, the case details help to identify the dynamics of sourcing strategy switches and to interpret the rationale behind these moves. Confirmatory follow-up research covering both the demand and supply side of the market is needed. Practical implications -Switching sourcing modes is of strategic relevance to managers as lifecycle costing strategies are influenced by them. Managers should plan these decisions more effectively, evaluating the factual pros and cons of a proposed sourcing mode switch and taking the dynamics of supply markets into account. Originality/value -The importance of the different motives for sourcing strategy changes clearly varies with the dynamism of the context (market situations and strategic intentions of buyers). A model linking the buyers' portfolio matrix to the product life cycle on the supply market is proposed.Keywords Single sourcing, Purchasing, Sourcing, Strategic change, Supplier evaluation Paper type Research paperAn executive summary for managers and executive readers can be found at the end of this issue. Problem statementOne of the most important strategic problems facing purchasing managers is the selection of an appropriate number of suppliers for each product purchased. Several solutions have been presented in literature, ranging from single sourcing via dual and parallel sourcing (Richardson, 1993) to multiple sourcing. Each strategy has its advantages and drawbacks. Most of the research takes a static approach to purchasing strategy and considers the chosen sourcing option to be relatively stable over time. But strategies do change. So far, only Dubois and Gadde (1996) and Araujo et al. (1999) have depicted changes in sourcing strategies. In this paper the existing literature is complemented by identifying changes in sourcing strategy and by investigating the following questions:.

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“…To change the role of purchasing and improve purchasing performance talented and well-trained managerial personnel is necessary. Selecting and assigning the best available people to the purchasing function is important to fully utilise its potential (Watts et al, 1995). When purchasing can take on a more pro-active role and operate at a strategic level there is a great opportunity to attain competitive advantage through strategic purchasing (Ellram and Carr, 1994).…”

Section: Purchasing As a Strategic Functionmentioning

confidence: 99%