A contextual analysis of the impact of strategic sourcing and E-procurement on performance

The aim of this study is to investigate the relationships among strategic sourcing, e-procurement and firm performance, along with the moderating effects of business characteristics and environmental factors on these relationships.

This empirical investigation relies on structured survey responses from 137 managers of US manufacturing firms. The partial least squares-based structural equation modeling approach is used for data analysis.

The research results confirm that both strategic sourcing and e-procurement have a positive effect on firm performance. In addition, e-procurement is also found to have a positive impact on strategic sourcing. In addition, the research results suggest that business characteristics and the environment, especially the degree of competition, market turbulence, firm size and stage in product life cycle moderate these relationships significantly. The positive effects of strategic sourcing and e-procurement on firm performance are particularly enhanced under the right conditions.

This research is the first, to the best of our knowledge, to provide insights into the joint effects of strategic sourcing and e-procurement, and how business characteristics and the environment affect their roles on firm performance. In addition, firm performance is evaluated as a multi-dimensional construct involving financial, operational and supply chain aspects, with the measurements consisting of several second-order constructs. The study makes both theoretical and practical contributions.