Competitive advantage impacts of direct procurement management capabilities and Web-based direct procurement system

Abstract

This study adopts a resource-based view to investigate the impact of direct procurement management capabilities and information technology (IT) capabilities derived from Web-based direct procurement systems on competitive advantage. A sample of 128 manufacturing firms in Taiwan with an experience of participating in government-subsidised e-business development projects is surveyed, with resulting data subject to partial least squares analysis to investigate main and interaction effects. The results show that, as hypothesised, process efficiency capability and coordination capability contribute significantly to competitive advantage, but IT capabilities derived from Web-based direct procurement systems per se are not significantly associated with competitive advantage. However, IT capabilities are found to play important roles in reinforcing direct procurement management capabilities.