bluuebunny/crossref_metadata_2025 huggingface dataset:
Trends in Information Systems Outsourcing
Authors: Behara Ravi S. , Gundersen David E. , Capozzoli Ernest A.
Published: April 2006

Information is critical to an organization's performance in today's knowledge based economy‐and information systems have become a primary resource. The management of information systems in organizations is currently undergoing a transformation. Outsourcing, an integral part of corporate strategy, is now being adopted as an approach to manage information systems. This has resulted in the spawning and rapid growth of the information services industry. This article reviews this new trend in the management of information systems and evaluates its implications for management.
Reverse Marketing: A Synergy of Purchasing and Relationship Marketing
Authors: Biemans Wim G. , Brand Maryse J.
Published: April 2006

Firms increasingly realize that dramatically changing market conditions require significant changes in their purchasing function. In more and more firms, purchasing is becoming proactive and strategically important. This phenomenon has been called “reverse marketing.” As the term implies, there are clear similarities with the marketing concept. This article explores the concept by describing how companies can implement reverse marketing by making use of wellknown marketing concepts and tools. A detailed description of a fictitious case illustrates how basic marketing principles can be used to achieve proactive purchasing.
Sources of Purchasing Managers’ Influence Within the Organization
Authors: Smeltzer Larry , Goel Sanjay
Published: April 2006

A review of the concepts associated with organizational influence is presented; then this perspective is applied to the purchasing function. The conclusion is that purchasing managers’ organizational influence is a function of four types of power: (1) position, (2) expert, (3) resource, and (4) political power. Subsequently, five variables determine the extent to which these power bases may be used by purchasing managers. These variables are the industry, firm, department, CEO, and individual characteristics of the purchasing manager. Each of these power bases and variables are explored as they relate to purchasing managers. As a result of the analysis and discussion, five practical guidelines for increasing purchasing's influence are suggested.
Negotiation Outcomes: The Impact of the Initial Offer, Time, Gender, and Team Size
Authors: Min Hokey , LaTour Michael S. , Jones Michael A.
Published: April 2006

A successful path to purchasing negotiation often hinges on a buyer's ability to gain relative bargaining strength. Unfortunately, the establishment of a strong bargaining position for a buyer is not a simple matter because of the multitude of factors affecting the buyer's negotiation leverage. To help purchasing professionals develop more effective negotiation strategies, this study empirically identifies key factors affecting the bargaining position of purchasing professionals and their subsequent impact on negotiation outcomes.
Problem Sources in Establishing Strategic Supplier Alliances
Authors: Stuart F. Ian , McCutcheon David
Published: April 2006

Recent interest in alternative purchasing arrangements has centered on “supplier alliances,” an approach used to establish broader roles in the buyer‐supplier relationship. Prior research about strategic supplier alliances has focused on the appropriate environments for developing these relationships and the potential benefits of such a strategy. This article addresses a different issue: implementation difficulties caused by supplier discontent. Information about this issue has been generated from a survey covering a wide array of firms. Responding buyers were requested to nominate exemplary suppliers for a follow‐up survey. Responses from matched pairs of buyers and suppliers subsequently were compared for differences in their perceptions of their alliance. The degree to which their views differed was evaluated against several key hypotheses. This research interprets and suggests the management implications of the results.
JIT's Impact on a Firm's Financial Statements
Authors: Courtis John K.
Published: April 2006

Many corporations have a large investment in inventory, and at the same time they must be adaptive to cope with increasingly volatile environments. One way of releasing resources and stimulating productive reorganization is to introduce a just‐in‐time inventory system. This article identifies the various cash flow and financial statement consequences of this action in both the short and longer terms. It is argued that the overall value of inventory will decrease, cash will show an upward trend, accounts receivable and plant assets will increase, accounts payable will rise, additional equity or long‐term debt will be issued, income taxes payable will rise after an initial reduction, and retained earnings will increase. Moreover, once any holding gain effect has run its course, the consequences of improved productivity, cost reduction, and production, coupled with revenue growth, will increase net income.
Purchasing for Lean Production: The New Strategic Agenda
Authors: Hines Peter
Published: April 2006

The success of Japanese manufacturing firms over a wide range of product categories is well established; however, one can argue that the success of an individual manufacturing system (such as the excellent Toyota Production System) has not been the causal factor. Rather, it is the thorough and speedy implementation of these systems throughout the complete supplier network that is crucial to manufacturing success.

In this and other areas, purchasing has played a pivotal role in the deployment of what may be termed lean production. This article reviews the new strategic agenda set by lean production and explores how this affects the purchasing operation. Additionally, lean production attempts to build a new paradigm based on the integration of the different value‐adding organizations within the value stream to ensure excellence in final products and services. The term concurrent purchasing is used to describe this new paradigm. In moving to concurrent purchasing, purchasing is repositioned as a key strategic and operational process rather than an internal stand‐alone function.

The achievement of intercompany value stream effectiveness is discussed in terms of improvements within the quality, cost, delivery, and design processes. The key role of purchasing in these processes is explored together with the implications this has for the strategic agenda within the subject at practitioner, education, and academic levels.
A Comparison of North American and European Future Purchasing Trends
Authors: Carter Joseph R. , Narasimhan Ram
Published: April 2006

What jobs will exist in a typical firm's purchasing function in the future? The predictions include the following: The absolute number of jobs within purchasing will decrease, as will the layers of management. Purchasing organizations will adopt flatter forms, with less emphasis on hierarchy and less distinction between positions. “Functional silos” will become obsolete. The classical functions of marketing, manufacturing, engineering, purchasing, finance, and personnel will be less important in defining work. More people will take on project work focused on continuous improvement of one kind or another. Fundamental restructuring and reengineering will become a way of life at most companies. The primary focal points will be a new market‐driven emphasis on creating value with customers; greatly increased flexibility; a new business‐driven attack on global markets that includes a deployment of information technology; and fundamentally new jobs. Work will become integrated in its orientation, and the payoffs will increasingly be made through connections across organizational and company boundaries. New measurements that focus on strategic directions will be required. Metrics will be developed, similar to the “cost of quality” metric, which incorporate the most important dimensions of the environment. New human resource management approaches will be developed; human resource management will become less of a staff function and more closely integrated with the basic work. Teamwork will be critical to organizational success.

This article presents the results of an interactive assessment of future purchasing trends provided by two groups of senior purchasing and materials management executives—one group from the North American Executive Purchasing Roundtable, and the other from the European Executive Purchasing Roundtable.
Third‐Party Logistics Service Providers: Purchasers’ Perceptions
Authors: Daugherty Patricia J. , Stank Theodore P. , Rogers Dale S.
Published: April 2006

A recent survey of manufacturers provides insight into their relationships with providers of international logistics services. The research examines the purchasers’ perceptions regarding the service providers’ capabilities. Further, differences between high‐performance logistics providers and those perceived as providing lower levels of performance are identified and discussed.
Purchasing and Supply Management: Future Directions and Trends
Authors: Carter Joseph R. , Narasimhan Ram
Published: April 2006

IN BRIEF

This article provides a summary of The Purchasing Futures Research Project, sponsored by the Center for Advanced Purchasing Studies (CAPS). The project's goal was to develop a vision of the nature of the purchasing and supply management function in the next century, including roles, responsibilities, capabilities, and organizational structures. The article identifies various purchasing and business market trends and synthesizes these into strategic organizational propositions that describe how purchasing and supply management can develop during the next century.
A Case Study of Successful Partnering Implementation
Authors: Ellram Lisa M. , Edis Owen R.V.
Published: April 2006

This article provides a detailed case study of successful buyer‐supplier partnership development and maintenance at the Eastman Kodak Company. Kodak followed a methodical approach, adapting a managerial guideline for “partnering” originally developed by one of the authors in 1991. The term “partnering” is used here in the sense of cooperative buyer‐supplier relationships, rather than in the legal sense. This article provides a summary of the key issues Kodak faced, along with the benefits it has experienced in developing and maintaining successful partnering relationships.
A Framework for Purchasing and Integrated Product Teams
Authors: Murphy David J. , Heberling Michael E.
Published: April 2006

Multi‐disciplinary teams have become essential to success in today's volatile business environment. However, many organizations have not been successful in implementing the team concept. This article discusses a group of case studies that examine the obstacles organizations encounter as they implement integrated product teams. Based on results of the case studies, the authors offer a suggested approach for organizing successful cross‐functional teams – and for developing the skills required of purchasing professionals for successful team membership.
A Development Model for Effective MRO Procurement
Authors: Barry Jack , Cavinato Joseph L. , Green Alice , Young Richard R.
Published: April 2006

Maintenance, repair, and operating (MRO) supplies have long been considered one of the least systematic and most problematic areas of purchasing. In the quest for productivity, many firms have attacked this area for cost savings and value‐added opportunities. This research reveals that in practice MRO purchasing is in three phases of development, with different purchasing activities, processes, and user interfaces, as well as perceptions, at each phase.
Procurement Reform and MIS Project Success
Authors: Hulme Martyn R.
Published: April 2006

IN BRIEF

Less than one in 10 large Management Information System (MIS) projects succeeds. While the procurement process is not the only factor known to contribute to this high failure rate, it has been consistently identified as a source of difficulty. Knowing that procurement contributes to difficulty, however, is not useful if the reason it does so is not also known. This article analyzes procurement's contribution to failure, and describes the reforms needed to improve opportunities for success. The problem stems from the wide use of tender theory procurement (competitive bidding), and the invalid assumption that a specification can provide the basis for making value‐oriented MIS buying decisions. In addition, tender theory procurement interacts with the MIS project environment to create an ethical hazard that makes it almost impossible to succeed. The reforms needed to overcome these problems are substantial. They require that tender theory be set aside and replaced by partnering‐oriented procurement methods.
Supplier Selection Criteria in the Healthcare Industry: A Comparison of Importance and Performace
Authors: Lambert Douglas M. , Adams Ronald J. , Emmelhainz Margaret A.
Published: April 2006

IN BRIEF

As healthcare costs have risen, increased attention has been focused on the role of purchasing within hospitals. This article reviews the attributes traditionally used by purchasing managers in supplier selection and then examines the attributes currently being used within a health care setting. The conclusion is that even though the government and insurers have placed considerable pressure on healthcare providers to reduce costs, low price has not become a more important attribute in supplier selection than product quality, delivery, or service. Further, the research team found that, on average, suppliers are not meeting customer requirements on key supplier selection attributes.
Purchasing's Performance as Seen By Its Internal Customers: A Study in a Service Organization
Authors: Young Joyce A. , Varble Dale L.
Published: April 2006

IN BRIEF

In today's Total Quality Management environment, the purchasing function is not only responsible for securing vital production and facilitating resources for its organization, it is also charged with providing quality service to its internal customers. To date, the purchasing profession does not have a widely accepted instrument to measure the dimensions of service quality within a purchasing context. This research attempts to address this void by applying SERVQUAL, an instrument that has traditionally been used to assess retail consumer perceptions of service quality, to purchasing performance within a service organization. Initial results indicate that SERVQUAL does provide the purchasing function with a useful method for obtaining feedback from its internal customers.
Supply‐Based Strategies, Human Resource Initiatives, Procurement Leadtime, and Firm Performance
Authors: Jayaram Jayanth , Vickery Shawnee K.
Published: April 2006

IN BRIEF

The role of procurement leadtime (PLT) in time‐based competition (TBC) has received little attention in procurement and operations literature. This article examines the relationship of procurement leadtime to overall firm performance and identifies key antecedents of procurement leadtime performance. The research focuses on first‐tier suppliers to the “Big 3” automobile manufacturers in North America. Linkages among supply‐based strategies, human resource (HR) initiatives, procurement leadtime performance, and overall business performance are tested empirically. The study shows that procurement leadtime is significantly related to overall firm performance, especially market share and market share growth. The supply‐based strategy of standardization and the HR strategy of employee empowerment are shown to be key drivers of procurement leadtime performance. Also, the combined use of these strategies is shown to have a synergistic effect on procurement leadtime.
Trust and Relationship Commitment in Logistics Alliances: A Buyer Perspective
Authors: Moore Kevin R.
Published: April 2006

IN BRIEF

This research provides new insights into logistics alliances by examining the roles of trust and commitment in such relationships. A model of logistics alliances from a buying firm's perspective is proposed and empirically tested using a sample of 339 firms with various types of logistics alliances. The results indicate that both trust and relationship commitment are important elements in logistics alliances. A third party's equity behavior appears to be an important factor affecting the development of trust in a relationship while conflict significantly hinders the development of relationship commitment. The results also indicate that relationship commitment and effectiveness are influenced more by negative outcomes associated with conflict than by positive outcomes associated with trust.
Proactive Supply Management: The Management of Risk
Authors: Smeltzer Larry R. , Siferd Sue P.
Published: April 2006

IN BRIEF

Proactive supply management is a frequently used phrase, yet no agreement exists about its precise meaning. This article argues that proactive purchasing management is risk management, a perspective that evolved from case studies of the purchasing function. To better understand risk management from the perspective of purchasing management, it is analyzed within the context of transaction cost theory and the resource dependency model. Evidence is provided from the case studies that risk management is an appropriate framework for understanding proactive purchasing management. Examples of risk management through proactive purchasing activities are presented.
The Product Life Cycle: A Tool for Functional Strategic Alignment
Authors: Birou Laura M. , Fawcett Stanley E. , Magnan Gregory M.
Published: April 2006

IN BRIEF

This article develops an integrative strategic framework utilizing the Product Life Cycle (PLC) as a “common strategic denominator”. The model is an attempt to fill an existing void in the strategic literature concerning the integration of different functional strategies into a holistic business strategy.

This article reports the results of a three‐part empirical study of production, purchasing, and logistics management professionals that investigated the linkage between functional level strategies and the PLC. The results are based on the input from 159 production, 126 purchasing, and 133 physical distribution executives who served to identify the strategic importance of the PLC, and effective functional strategies for each stage of the PLC.
The Influence of Organizational Factors on Purchasing Activities
Authors: Johnson P. Fraser , Leenders Michiel R. , Fearon Harold E.
Published: April 2006

Data from the 1995 CAPS study on purchasing's organizational roles and responsibilities were used to examine the involvement of the supply area in major corporate activities, use of team‐based purchasing techniques, and functions that report to purchasing. A number of organizational factors were found to influence the role of purchasing within the firm, including status and related work experience of the chief purchasing officer (CPO), and the degree to which the supply area was centralized. Overall, respondents indicated that purchasing had a low level of involvement in major corporate activities, despite previous research that demonstrated the value of the supply function as a competitive weapon. The study also found that a surprisingly large number of firms appointed individuals lacking prior purchasing experience to the position of CPO.
Alliances, Logistics Barriers, and Strategic Actions in the People's Republic of China
Authors: Pearson John N. , Carter Joseph R. , Peng Li
Published: April 2006

Many U.S. multinational firms are attempting to establish supply chains in the People's Republic of China. In order to foster such development, many of these firms are developing strategic alliances with Chinese partner companies. U.S. multinational firms that have strategic alliances with Chinese partners were surveyed concerning the logistics barriers they have encountered and the strategic actions they have developed to overcome these barriers. The results of this research indicate that U.S. multinational firms have experienced a considerable number of barriers and have used various types of strategic actions to overcome these barriers.
Purchasing and Supply Management: Trends and Changes Throughout the 1990s
Authors: Trent Robert J. , Monczka Robert M.
Published: April 2006

Understanding the changes and trends affecting purchasing requires replacing anecdotal evidence with research‐based observations. Using data collected annually from leading firms worldwide, this article details the real and projected changes and trends that have affected and will continue to affect purchasing and sourcing professionals. These changes and trends appear within seven areas: (1) performance improvement requirements, (2) supplier and purchasing/sourcing importance, (3) organization, (4) systems development, (5) performance measurement, (6) supply base management, and (7) purchasing responsibilities and activities. A lack of awareness concerning these trends by purchasing professionals limits their ability to anticipate change and respond in a way that will create competitive advantage for their organization.
Environmental Purchasing: Benchmarking Our German Counterparts
Authors: Carter Craig R. , Ellram Lisa M. , Ready Kathryn J.
Published: April 2006

Environmental purchasing consists of purchasing's involvement in activities that include reduction, reuse, and recycling of materials. Despite the valuable role that the purchasing function can play in an organization's environmental activities, research is only now beginning to emerge in this area. The authors present a reliable and valid scale used to measure environmental purchasing, examine the company‐specific factors that impact these activities, and compare the actions of U.S. purchasing managers to those of their German counterparts. Directions for much needed future research are then proposed.
The Role of Purchasing in the Agile Enterprise
Authors: Meier Ronald L. , Humphreys Michael A. , Williams Michael R.
Published: April 2006

The article examines purchasing's role in achieving agility and competitive advantage. Using a Delphi study, this research investigated and identified buying behaviors that optimize a firm's relationship with key suppliers (Supplier‐Oriented Purchasing Behaviors). Implications for managing agile purchasing strategies are discussed.
Measuring Contractors' Performance
Authors: Straight Ronald L.
Published: April 2006

Government contractors now provide citizens services once provided directly by federal, state, and local governments. The number and value of contractual actions and their importance continue to grow, representing an increasingly larger share of governmental services. It is now vital that contractors be selected that will perform contractual requirements without fail so that essential services are not disrupted. In all contract situations‐federal, state, local, or commercial‐a simple method of evaluating contractors is essential. A system too complex or too difficult for evaluators to carry out will not achieve its goal. This article discusses the essential elements of a contractor performance measurement system, reviews the difficulties that may be encountered, and recommends factors to be incorporated in an effective system.
The Year 2000 Problem in the Supply Chain: A Managerial Perspective
Authors: Essig Michael , Arnold Ulli , Scheuing Eberhard
Published: April 2006

This article reports the results of a Center for Advanced Purchasing Studies (CAPS)‐sponsored study on the Year 2000 (Y2K) problem in the supply chain. A special research agenda is presented which shows that the Y2K challenge is not just a computer problem. Models for achieving supply chain Y2K compliance are developed and empirically tested. The data are based on questionnaires and focus groups in the United States and Germany.
The Impact of Web‐Based Procurement on the Management of Operating Resources Supply
Authors: Croom Simon R.
Published: April 2006

The focus of this article is on the impact of Web‐based order processing systems for procurement strategy in the management of maintenance, repair, and operating (MRO) supply. The management of MRO supplies has been little discussed in the literature, and in many organizations is undertaken in a devolved, decentralized, and uncoordinated fashion. Consequently, MRO procurement is often a poorly managed and non‐value‐added activity, yet MRO purchases may account for many millions of dollars of expenditure for organizations across most, if not all, industries. To explore the impact of Web‐based procurement systems on MRO purchasing, a Delphi study was conducted providing access and analysis of commercially sensitive data.1

In this article, it is contended that greater information processing capability achieved through the use of electronic commerce, specifically Web‐based procurement, will enable significant cost improvements and strategic leverage to be obtained through a more strategic approach to management of the typically low‐value, high‐variety goods and services that constitute the main category of MRO items. E‐procurement of MRO items may be a so‐called “killer application” on the basis of potential efficiency gains.

Further, an important consequence of the reengineering of the MRO procurement process will be to raise the professional profile of the purchasing function through enhanced internal customer service and significant total cost improvements.
ISO 14000: Assessing Its Perceived Impact on Corporate Performance
Authors: Montabon Frank , Melnyk Steven A. , Sroufe Robert , Calantone Roger J
Published: April 2006

The ISO 14000 series of environmental standards is a relatively recent development in environmentally responsible manufacturing (ERM). It applies to environmental systems and processes the same approach used by its predecessor, the ISO 9000 quality standards. Being relatively new, numerous questions have arisen regarding the impact of these new standards on both the corporate environmental management system and corporate performance. This article addresses some of these questions by drawing on data generated by a large‐scale survey of American managers. The results indicate that, even though ISO 14000 has achieved relatively limited acceptance, there is strong evidence to indicate that this series of standards can positively impact both the performance of the environmental management system as well as overall corporate performance. Further, it was found to outperform other ERM initiatives such as the Environmental Protection Agency's (EPA) 33/50 program.
Purchasing Competence and Its Relationship with Manufacturing Performance
Authors: Das Ajay , Narasimhan Ram
Published: April 2006

This article develops purchasing competence as a valid construct and explores its relationship with different manufacturing priorities. An empirical study is conducted among purchasing professionals in manufacturing firms. The results of the research indicate that purchasing competence can be operationalized, developed, and estimated in a firm. Further, purchasing competence is found to have a positive impact on manufacturing cost, quality, and delivery, as well as new product introduction and customization performance. Purchasing integration, a component of purchasing competence, is found to relate to all dimensions of manufacturing performance.
An Empirical Investigation of Global Sourcing Strategy Effectiveness
Authors: Petersen Kenneth J , Prayer David J , Scannell Thomas V.
Published: April 2006

This study was undertaken to address the need for empirical research on global sourcing strategy effectiveness. This article establishes the importance of and relationships between several factors that drive the effectiveness of global sourcing strategies. Companies are increasingly viewing global sourcing strategies as a means of reducing cost, increasing quality, and enhancing a firm's overall competitive position. This article uses a structural equation modeling methodology to test an explanatory model of global sourcing strategy effectiveness. Results indicate that global sourcing structures and processes, global sourcing business capabilities, international language capabilities, and top management commitment to global sourcing are critical to the effectiveness of a global sourcing strategy.
Purchasing and Supply M anagement's Participation in the Target Costing Process
Authors: Ellram Lisa M.
Published: April 2006

This article explores the participation of the purchasing and supply management function in the process of target costing. Target costing is an emerging process whereby organizations calculate the allowable cost (i.e., target cost) for buying/producing the product or service they offer for sale by first determining the acceptable selling price in the marketplace and the organization's required internal margin on the product. Based on case studies of organizations that use target costing, this research is both descriptive and prescriptive in nature. The four primary issues addressed in this article are:

Why do organizations undertake target costing?

Is there a common pattern of participation for the purchasing and supply management function in target costing?

What should the role of purchasing and supply management be in the target costing process?

How can purchasing and supply management be most effectively involved in the target costing process?
Supply Chain M anagement and Its Impact on Purchasing
Authors: Wisner Joel D. , Tan Keah Choon
Published: April 2006

The term “supply chain management” has been used to denote the integration of logistics and physical distribution activities by wholesalers and retailers and manufacturers' efforts to effectively integrate purchasing and supply with other functions in the firm. The concept is still evolving. There is no generally accepted definition of supply chain management or general understanding of how supply chain management impacts organizational characteristics and practices. This article presents exploratory findings from a comprehensive survey regarding supply chain management. The objectives of this study were to study the impact of supply chain management on purchasing practices, to further define and develop the supply chain model from various perspectives, and to identify problems associated with supply chain management, particularly from the purchasing perspective.
An Empirical Study of the Relationships among Purchasing Skills and Strategic Purchasing, Financial Performance, and Supplier Responsiveness
Authors: Carr Amelia S. , Smeltzer Larry R.
Published: April 2006

Three hypotheses are tested to determine if purchasing skills are related to strategic purchasing, a firm's financial performance, and supplier responsiveness. To test the hypotheses, a survey was administered to a sample of purchasing vice presidents, directors, and managers. A holdout sample was used for exploratory data analysis to test for type (manufacturing compared to non‐manufacturing firms) and size (large compared to small firms). A regression analysis of the remaining sample of 85 surveys indicated that purchasing skills were related to strategic purchasing, a firm's financial performance, and supplier responsiveness. Both research and managerial implications are discussed.
Vertical Cooperation in the Construction Industry: Size Does Matter
Authors: Welling Derk Th. , Kamann Dirk‐Jan F.
Published: April 2006

The construction industry is characterized by opportunistic behavior and the lack of vertical cooperation. This article shows how game theory explains this phenomenon and helps to solve it. When the same individuals have to deal with each other in a series of projects, cooperation is more likely to occur than when they deal with a different individual in each project. Supported by an experiment with managers in a construction firm, it was found that particularly in large construction companies, individuals rarely deal with the same individuals at subcontractors. The business recommendation following from this is to adopt an explicit policy of appointing account managers both at the purchasing side of the contractor and the marketing side of the subcontractor to deal with the mutual contacts between the organizations involved.
A Model for Strategic Supplier Selection
Authors: Sarkis Joseph , Talluri Srinivas
Published: April 2006

The purchasing function for some time now has been receiving increasing importance as a critical supply chain management component. This is mainly due to the significant impact of material costs on profits, increased investments in advanced manufacturing and information technologies, and a growing emphasis on Just‐In‐Time GIT) production. The critical objectives of purchasing departments include obtaining the product at the right cost in the right quantity with the right quality at the right time from the right source. This requires executing effective decisions concerning supplier selection and evaluation. This article addresses the supplier selection process. This model for evaluation and selection of suppliers considers multiple factors that include strategic, operational, tangible, and intangible measures. The model also allows for input from a variety of managerial decisionmaking levels and considers the dynamic aspects of the competitive environment in evaluating suppliers. An empirical case illustration demonstrates the efficacy of the model. The results provide interesting managerial implications.
Supply Chain Management: Practices, Concerns, and Performance Issues
Authors: Tan Keah Choon
Published: April 2006

The advent of information technology and intense global competition has enticed many world‐class manufacturers and service providers into adopting an integrated strategic approach to supply chain management. Although many supply chain management efforts have failed to achieve the desired results, it has become a significant strategic tool for firms striving to achieve competitive success. Using a survey of senior supply and materials management professionals in the United States, this study investigates the contemporary practices and concerns of supply chain management. This study also relates the practices and concerns to firms' performance by means of bivariate correlation and multiple linear regression analysis. A general conclusion is that all of the significant supply chain management practices positively impact performance.
Strategic Direction through Purchasing Portfolio Management: A Case Study
Authors: Gelderman Cees J , van Weele Arjan J.
Published: April 2006

Contrary to the growing number of academic publications on purchasing portfolio models in literature, little is known about their actual use. Kraljic's portfolio model, which was developed in 1983, seems to be the dominant approach in the profession. This model, however, does not provide guidelines for strategic movement of commodities and/or suppliers within the matrix. Based on an in‐depth case study, derived from a major Dutch chemical company, the use of portfolio techniques in purchasing has been explored and described. The results indicate that Kraljic's portfolio approach, when elaborated and tailored, indeed allows for sufficient guidance for developing effective purchasing and supplier strategies. The case study points out what supplier strategies are feasible and what conditions should be met in order to make them happen.
The Role of Value‐at‐Risk in Purchasing: An Application to the Foodservice Industry
Authors: Sanders Dwight R. , Manfredo Mark R.
Published: April 2006

Value‐at‐Risk (VaR) estimates the downside risk of a portfolio of market‐priced assets at a particular confidence level over a specified time horizon. This article is a tutorial that introduces purchasing managers to the concept of VaR and its potential applications in the purchasing process. It discusses estimation alternatives and issues, and then examines and highlights the role of VaR in the context of a commodity end user with a specific example for a foodservice business. Further, the practical implementation issues of VaR in a corporate environment in general and the purchasing function in particular are discussed. The example and discussions are widely applicable to any commodity end user (e.g., energies, metals, or food‐related commodities), providing potential applications to practitioners and research ideas to academics.
Exploring the Effect of Supplier Management on Performance in the Korean Automotive Supply Chain
Authors: Park Seungwook , Hartley Janet L.
Published: April 2006

This article explores the relationship between supply management practices and performance from a supply chain perspective. A conceptual model of suppliermanagement practices and performance was developed and tested using covariance structural modeling. Survey data were gathered from first‐tier suppliers in the Korean automotive industry. The results showed that in a supply chain, the suppliermanagement practices adopted by first‐tier suppliers affected second‐tier suppliers' performance. Second‐tier suppliers' performance consequently influenced both first‐tier suppliers' quality and delivery performance. These findings suggest that best practices in supplier management should be transferred upstream in the supply chain to improve overall performance of the entire supply chain.
Enhancing Supply Decisions through the Use of Efficient Marginal Costs Models
Authors: Talluri Srinivas
Published: April 2006

Supply managers are often faced with the challenge of making effective purchasing decisions in acquiring production materials, supplies, and capital equipment. The complexity of the procurement process has mainly intensified due to the increased emphasis on delivery performance, product quality, and technical service apart from traditional cost measures This article presents a set of multi‐criteria models for estimation of efficient marginal costs of supplier outputs, which provide critical information to managers on the values of outputs. The marginal costs are utllized for making effective purchasing decisions by setting optimal output prices for negotiation on supplier bids. The models are tested on an actual dataset of suppliers.
A Multi‐Criteria Group Decisionmaking Model for Supplier Rating
Authors: Muralidharan C. , Anantharaman N. , Deshmukh S.G.
Published: April 2006

An important problem in decision analysis is the evaluation of the difference between two or more different rankings for a set of alternatives. A novel model based on the aggregation technique for combining group member's preferences into one consensus ranking is suggested in this article. The model developed may be used to develop consensus and evolve ranking of alternatives. The application of the model is demonstrated through a case for supplier rating. The advantages of the proposed approach are also highlighted.
What is SCM? And, Where is It?
Authors: Larson Paul D. , Halldorsson Arni
Published: April 2006

This article provides insight on the evolution and emergence of the supply chain management(SCM) concept and shares conclusions about the future of SCM from the perspective of educators, researchers, and practitioners. Based on a survey of SCM educators, the article seeks to delimit the scope or domain of SCM and how the boundaries have changed and continue to change. This is done by contrasting four perspectives on SCM versus purchasing: traditionalist, relabeling, unionist, and intersectionist.
Supply M anagement: What's in a Name? Or, Do We Know Who We Are?
Authors: Kauffman Ralph G.
Published: April 2006

This article provides a conceptual basis from which to view some alternative perspectives of supply management. These approaches highlight the fractious nature of the purchasing/supply/logistics fields. Additionally, the article includes a proposal fora potentially unifying framework of the strategic components used by practitioners and researchers in supply and related fields.
Creating Corporate Advantage through Purchasing: Toward a Contingency Model
Authors: Rozemeijer Frank A. , van Weele Arjan , Weggeman Mathieu
Published: April 2006

This study was undertaken to address the need for empirical research for improving and sustaining corporate advantage through purchasing. This article explains how large corporations may effectively manage purchasing synergies among individual business units. It will become clear that in doing so, corporate purchasing officers (CPOs) need to tailor their approach depending on three constructs, i.e., purchasing maturity, corporate coherence, and business context. Based upon these constructs, they may select five different coordinating mechanisms to foster purchasing synergies within their corporation.
Thirty‐Rve Years of The Journal of Supply Chain Management: Where Have We Been and Where are We Going?
Authors: Carter Craig R. , Ellram Lisa M.
Published: April 2006

The Journal of Supply Chain Management is the premier journal in the purchasing and supply discipline. This article chronicles the history of the Journal, including a review of the subject categories of articles during certain time periods, types of research performed, types of research design employed, types of data analysis applied, and individual and institutional contributions. The article provides a comprehensive analysis of the Journal's past and a set of prescriptions for its future.
The Impact of Cycle Time on Supplier Selection and Subsequent Performance Outcomes
Authors: Sharland Alex , Eltantawy Reham A. , Giunipero Larry C.
Published: April 2006

Cycle time is among the emerging performance criteria for purchasing and supply management. However, little empirical research has been conducted for actually evaluating the impact of cycle time on strategic issues, such as long‐term business relationships and supplier selection and evaluation processes. This study empirically tests the impact of cycle time on supplier selection and on the effectiveness of long‐term relationships with suppliers, as reflected in the commitment and trust developed. Findings indicate that initial cycle time is not a significant predictor of trust and commitment in the context of supplier‐buyer long‐term relationships. However, cycle time reduction along with consistently high quality were found to be significant predictors of trust and commitment in long‐term relationships.
An Agency Theory Investigation of Supply Risk M anagement
Authors: Zsidisin George A. , Ellram Lisa M.
Published: April 2006

Managing supply risk is an essential element of the overall supply management task. As the complexity of risk management has increased, responsiveness seems dominated by varying the level of inventory and using multiple supply sources as means of creating buffers. This research uses the framework of agency theory in managing supplier behaviors as a means to reduce supply risk and the impact of detrimental events. Empirical results indicate that purchasing organizations address various sources of supply risk by implementing management techniques that reduce the likelihood that detrimental events will occur. Firm size, purchases as a percentage of sales, and industry characteristics were also found to influence the manner in which supplier behaviors are managed.
Deciding on the Mode of Negotiation: To Auction or Not to Auction Electronically
Authors: Kaufmann Lutz , Carter Craig R.
Published: April 2006

Purchasing transactions are increasingly conducted through electronic auctions. Some companies already source 25 percent of their total purchase volume through this electronic mechanism. However, most of these purchasing transactions could, alternatively, be conducted as face‐to‐face negotiations. This article examines (a) when it is feasible to conduct an electronic auction in purchasing, and (b) under what circumstances it is better to source items through an electronic auction as opposed to sourcing them through face‐to‐face negotiations.
The Use of Organizational Design Features in Purchasing and Supply Management
Authors: Trent Robert J.
Published: April 2006

This article presents findings from a study examining organizational design features used by organizations in pursuing their procurement and supply objectives. The research purpose was to gain a better understanding of the organizational design features that firms currently use or may use in the future. The results should encourage organizations to address design issues as they relate to overall supply management effectiveness. Given the dynamics of the current competitive global supply landscape, organizational design concerns are critical to sustained organizational success.
Gender Issues in Buyer‐Seller Relationships: Does Gender Matter in Purchasing?
Authors: Pullins Ellen Bolman , Reid David A. , Plank Richard E.
Published: April 2006

While differences between male and female salespeople are well documented in the literature, evidence is less clear whether these differences matter to the buyer or whether buyers of different gender make decisions differently. The article reports results of a survey of male and female purchasers on the behaviors, trust, credibility and customer orientation of a salesperson. Almost no differences were found on any of the variables for male or female buyers. This calls into question past research that has found differences, and this paper argues that previous findings, while statistically significant, are probably not managerially significant.
Understanding and Managing the Services Supply Chain
Authors: Ellram Lisa M. , Tate Wendy L. , Billington Corey
Published: April 2006

Services have become increasingly important as the driving force in the U.S. economy. However, there has been little research to date on services supply chains. It is believed that service businesses can benefit by applying some best practices from manufacturing to their processes. However, the inherent differences in services create a need for supply chain management tools specific to the services sector. This article documents the growing importance of the services sector and of services purchasing. Next, it develops a supply chain framework appropriate for a services supply chain by comparing and contrasting the applicability of three product‐based manufacturing models: Global Supply Chain Forum Framework, SCOR and Hewlett‐Packard's Supply Chain Management Model. Finally, this research describes the challenges for procurement professionals managing purchases for a services supply chain and provides suggestions for use of supply chain management theory, and practices for improvement.
Firm and Individual Choice Drivers in Make‐or‐Buy Decisions: A Diminishing Role for Transaction Cost Economics?
Authors: McNally Regina C. , Griffin Abbie
Published: April 2006

Transaction cost economics (TCE) is an empirically supported, theoretical paradigm that has been used to understand and predict the outcomes of make‐or‐buy decisions. At the same time, TCE research has been criticized for focusing solely on firm‐level economic determinants of decision outcomes without considering other factors that may impact decision making in organizations. The purpose of this research is to examine the effects of variables associated with TCE and compensation systems on the outcomes of make‐or‐buy decisions to compare the predictive ability of these variables in the current business environment. Findings indicate that functional group reward systems are associated with the outcomes of make‐or‐buy decisions. Surprisingly, no support is found for the association between the TCE variables and decision outcomes.