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In the literature there has been little empirical research investigation into purchasing consortium issues focusing on a detailed analysis of information and communication technology (ICT) based procurement strategies. While some anecdotal accounts of such advances in supply chain management can be found, there is a need to relate the term electronic purchasing consortia (EPC) to academic literature, thus empowering clearer theoretical analysis. EPC enable purchasing organisations to varying degrees, to electronically conduct tasks that are necessary for the management of demand aggregation of two or more legal entities, provide efficient ICT-based communication infrastructures and rely more on electronic communication than face-to-face contact. An overall statement was developed for the study of EPC: ‘Effective participation in electronic purchasing consortia can have the potential to enhance competitive advantage. EPC implementation is dependent upon a clear and detailed understanding of the major process enablers and drivers. This understanding requires the development of a taxonomy and a conceptual framework to EPC. One practical use of this taxonomy is the assessment of feasibility in given industry sectors’ This overall statement is assessed by the exploration of academic literature, five multiple case studies and two surveys. 128 purchasing organisations as will as 43 e-Marketplaces/procurement service providers (PSPs) in the automotive and electronics industry sectors participated in the surveys. By adopting methodological pluralism and triangulation techniques, key factors and structures that affect the adoption and diffusion of EPC, based upon the technology-organisation –environment framework, and the performance impact of adoption are investigated. The findings suggest that only 7% of purchasing organisations take advantage of EPC, but 44% of e-Marketplaces /PSPs offer them to date. Organisation size, purchasing maturity and technological competence are strongly associated with adoption of EPC, while the level of industry fragmentation, pressures from the business context, purchasing spend, intensity of multi sourcing strategies and product pooling potential are not. EPC can enhance competitive advantage and have generated on average net reductions in purchasing costs of over 5% and a return on investment of over 70%. However, EPC do not necessarily lead to a higher level of purchasing effectiveness and efficiency, a lower level of maverick purchasing or a reduction in the number of suppliers. More conflict with EPC can arise in the automotive industry due to it OEM concentration, cultural and structural impediments (e.g. overcapacity, vertical integration) and technical factors (e.g. high level of modularised assembly). Sophisticated employment of EPC is still very much at a developmental stage. The empirically derived original model for EPC represents a valuable starting point of EPC research within which to comprehend its current state and the directions for future studies.
Huber, B. (2005) E-procurement Structures in Purchasing Consortia : Towards a Conceptual Framework, Doctoral Thesis. Technological University Dublin. doi:10.21427/D7288M