Digital procurement practices in SMES: comparative cases of advanced and emerging economies

Abstract

About 99 percent of American firms are small and medium-sized enterprises (SMEs) and more than 88 percent of people are employed in SMEs. However, most SMEs are not using supplier interactions in digital platforms which is a flexible IT infrastructure (software, hardware, and network) and a well-developed information management capability. Organizations can use digital procurement platforms to foster managerial improvisation and can leverage, depending on the type of unexpected event. If we look at the emerging economy, the percentage of SMEs of total business is almost the same as advanced economies, but their digitalization is much less than the advanced economy. It is obvious that digital procurement is now one of the most significant prerequisites to tackle the supply chain crisis that leads to gaining competitive advantages in the financial and non-financial perspective of a business. It is also true that lacking the proper understanding of digital transformation and organizational capabilities, many small and medium enterprises are facing enormous hardships to sustain. This study aims to examine the challenges and opportunities of SMEs with digital procurement. Based on the literature review, we present a research model of digital transformation which defines key variables. We also use case study instruments to target SMEs in different sectors in advanced (USA) and emerging economies (Bangladesh) for empirical investigation.