Using e‐procurement applications to achieve integration: what role does firm size play?

Abstract

PurposeThe purpose of this research is to empirically investigate the role of firm size in the use of e‐procurement applications that vary in their ability to facilitate supply chain integration.Design/methodology/approachThe sample was drawn from members of the Institute for Supply Management (ISM). Purchasing professionals employed in 33 different industries completed a self‐administered questionnaire.FindingsA total of 128 useable surveys were received. The data revealed a significant relationship between firm size and e‐procurement application. Specifically, larger firms were more likely to use integrative types of e‐procurement.Research limitations/implicationsThe study was limited in that it excluded purchasing professionals employed in the service sector. In addition, it only focused on the relationship between a single variable and e‐procurement application.Practical implicationsThis research provides support for studies that suggest that firm size is related to IT use. In addition, it tests the framework developed in a previous research study conducted on supply chain IT. Finally, previous research has linked supply chain process integration with operational agility, lower costs, superior product/service design, and enhanced profitability. The findings of this research might prompt decision‐makers to ask themselves if their firms forgo such potential benefits when integrative forms of e‐procurement are not used.Originality/valueThis research contributes to the understanding of an emerging phenomenon by investigating firm size as an explanatory variable in the e‐procurement application decision. In addition, evidence is still lacking with regard to the prevalence of actual implementation of e‐procurement in firms. This study examines actual usage of 13 different e‐procurement applications across various industries. Finally, this research focuses on the use of e‐procurement in achieving integration. This is important to practitioners, as effective supply chain integration has been linked to enhanced business performance.