Purchasing Policy or Purchasing Police? The Influence of Institutional Logics and Power on Responses to Purchasing Formalization

Abstract

Seeking to benefit from higher levels of purchasing maturity, many organizations strive to formalize their purchasing practices. Why these practices are not adopted by certain organizations or for certain types of purchases is less well understood, however. It has been argued that the purchasing of knowledge-intensive services is particularly difficult to formalize, but an in-depth understanding of the inter-and intra-organizational dynamics influencing this process is lacking. This study contributes to the purchasing and supply management literature by providing a finegrained understanding of how actors respond to formalization initiatives. Building on an exploratory interview methodology and using institutional logic and power theory as foundations, we show that formalization initiatives lead to institutional complexity and conflicts. Sets of strategies and counterstrategies for how to deal with the complexity and conflicts are identified, and relational power is found to moderate which strategy is used by the actors. Based on the empirical findings, a conceptual model is developed to describe the response process.Initiatives to formalize relational purchases break the flow of stability (Weick, 1995) in organizations, because they challenge well-established practices and norms. The actors involved need to make sense of the new situation and decide on an appropriate response. As previous research has illustrated, perceptions of

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