Abstract
This research explored the key concepts behind the decision to implement a web-based procurement system within an organisation. An initial literature review of the foundational concepts behind web-based procurement indicated that information technology played a vital role. Taylor (1997) illustrated that information technology facilitated accurate demand forecasting, and the monitoring of both internal and external efficiency control throughout the entire supply chain. Several researchers (Ellram, Zsidisin, Siferd, & Stanly (2002); Ellram & Carr, (1994); Harland, Lamming, & Cousins, (1999)) found that the strategic aspect of the purchasing activity was being advocated throughout top-level management, with an evolution of its abilities being observed over a 20 to 30 year period. Overall, the foundational concepts depicted an organisational environment that had matured and was ready for web-based procurement.
Internationally this procurement system gained ground as a viable alternative to traditional purchasing, the benefits that it provided organisations especially in staff compliance to purchasing policies and the elimination of maverick buying, resulted in significant savings.
Neef (2001) launched the discussion of web-based procurement as a revolution of the purchasing and procurement activity, with information technology being seen as the key driver throughout this development. Winter and Taylor's (2001) argument pertaining to information technology's ability to transform the organisation provided a crucial step to framing the environment within which an organisation implemented change. The literatures on e-commerce and e-business were also reviewed, as these are the two key strategies an organisation can adopt when operating within the digital realm.
Qualitative questionnaires were utilised to examine the strength of the relationships amongst the key concepts via a cognitive framing approach. This methodology was adopted as it provided a vehicle to communicate with a large group of purchasing and procurement professionals. Purposive sampling was employed to select the study participants, who were all members of the Supply Chain Association of New Zealand.
Analysis of both questionnaire and secondary data, using primarily descriptive statistics, yielded some interesting results. Several discrepancies with traditional research findings were identified, in particular the professional level at which participants operated within their respective organisations. A novel finding was that buyers tended to split suppliers into two distinct groups, with sophisticated web-based procurement systems adopted only for key suppliers, thereby fostering and maintaining the collaborative relationship often deemed a critical component of supply chain management.
Min and Galle (2003) noted that prior research into web-based procurement focused on operating benefits, rather than on contextual variables that might influence the success of implementation. It was recommended that further research occur into these contextual variables, with the changing relationship between the buyer and supplier and the effect of implementing web-based procurement on the entire supply chain being paramount. In addition the impact that information technology has on the buyer-supplier relationship should also be the focus of further research. It was also recommended that the association follow the implications for industry associations as prescribed in Crocombe, Enright and Porter (1991).