How Strategic Purchasing Orientation and Transformational Leadership Impact Performance: The Mediating Role of Information and Communication Technologies

Abstract

ABSTRACTPurpose: Purchasing orientation (greater efficiency, use of information and communication technologies; ICT) is becoming an underlying part of company strategy in an increasing number of business organizations. Transformational leadership by purchasing managers is also emerging as a tool to generate more intense and effective use of ICT and as a means of enhancing performance. The present research pursues 2 goals: firstly to explore how the strategic nature of the purchasing function and transformational leadership of purchasing managers impacts ICT use intensity and purchase efficiency, and secondly to pinpoint how the use of ICT affects purchase performance.Methodology/approach: The empirical work is based on an analysis of the information provided by a sample of 130 Spanish firms. Empirical verification of the proposed model was carried out through partial least squares analysis.Findings: Findings show that the strategic importance which management attaches to the purchasing function impacts the intensive use of ICT. However, the transformational leadership exercised by purchasing managers proves relevant in achieving greater cost efficiency and coordination with suppliers.Research implications: This work has sought to merge as determinants of efficiency both strategic aspects of the purchasing function in the firm as well as managerial aspects of said function (manager’s transformational leadership and the use of ICT). This research breaks new ground by empirically comparing the relationship between the strategic nature of the purchasing function in a firm and intensity of ICT use, a relation which has been the subject of very little inquiry and for which the mediating role of ICT in the link between strategic orientation and purchase performance is brought to light.Originality/value/contribution: The study makes a twofold contribution. Firstly, the present research seeks to bring together strategic aspects of the purchasing function in the firm as well as other management factors involved in said function (managers’ transformational leadership and use of ICT) as drivers of efficiency. In this sense, the findings point to the important role played by the purchasing manager vis-à-vis the strategic vision of the purchasing function in achieving cost efficiency and coordination with suppliers. Secondly, this research breaks new ground by empirically verifying the link between the strategic nature of the purchasing function in a firm and intensity of ICT use, a link which has been the focus of scant attention and for which we underpin the mediating role of ICT in the relationship between strategic orientation and purchase performance.