Effects of External Adoption of E-Procurement on Financial Performance in Pakistan’s Manufacturing Sector

Abstract

Purpose: This study examines the effects of external adoption of E-procurement on firms’ performance Design/Methodology/Approach: collected data from supply chain professionals in the manufacturing companies, the study employs a mixed-methods approach using both self-administered and online surveys. A questionnaire used for data collection, and Partial Least Squares Structural Equation Modeling (PLS-SEM) was employed for data analysis through SmartPLS 3.2.9. Findings: The results reveal that while external adoption of e-procurement negatively influences financial performance, however it positively impacts information transparency and supply chain integration. Financial performance is not directly increased by Information transparency, though it fosters supply chain integration. Supply chain integration, in turn, positively contributes to financial performance. Moreover, when mediated with supply chain integration external adoption of e-procurement increases financial performance. Furthermore, a sequential mediation effect is observed, where both information transparency and supply chain integration mediate between e-procurement adoption and financial performance. Implications/Originality/Value: These results offer significant theoretical and practical implications for enhancing supply chain strategies in emerging markets. The study concludes by providing recommendations for future research directions, particularly about digital procurement systems.