Impact of Global Purchasing and Supplier Integration on Product Innovation
Global purchasing and global supply chains are now common in most industries. This scholarly article written by Robin von Haartman and Lars Bengtsson describes and analyzes factors of global and regional sourcing and purchasing.
Abstract
Purpose – The interest in global purchasing has increased significantly in recent years, but the impact on product innovation is not well understood. The purpose of this paper is to empirically
analyze the impact of global purchasing on product innovation sourced from suppliers, while taking
into account how firms integrate their suppliers.
Design/methodology/approach – The data used in this study are from the International Purchasing
Survey, an international online survey on purchasing and supply management conducted in 2009. The
data are analyzed using factor and regression analyses.
Findings – The paper shows that global purchasing has no direct impact on product innovation
performance. However, supplier integration is more strongly associated with product innovation
performance for firms purchasing globally compared to firms purchasing regionally.
Practical implications – The implication is that when companies purchase globally, they must have
a highly developed purchasing department in order to sustain a high level of innovation. For firms
purchasing only regionally, the role of the purchasing department is diminished, at least in terms of
contributing to innovation.
Originality/value – This paper contributes to the discussion of potential advantages and
disadvantages of global purchasing. First, the paper provides an explanation for the ambiguous results
of previous research. Product innovation does not depend on whether firms are purchasing globally or
not, it depends on how they purchase. This paper has shown that when purchasing globally, the role
of the purchasing department becomes crucial for product innovation. The proficiency and activities of
the purchasing department largely determine the success, in terms of supplier product innovation, of
global purchasing.
Keywords Innovation, Survey, Supply chain management, Globalization, Purchasing,
Global operations management
Source: Robin von Haartman and Lars Bengtsson, https://www.emerald.com/insight/content/doi/10.1108/IJOPM-03-2015-0128/full/pdf?title=the-impact-of-global-purchasing-and-supplier-integration-on-product-innovation
This work is licensed under a Creative Commons Attribution 3.0 License.