Digital Procurement Research Articles

A digital procurement framework for South African public sector: A content analysis approach

A digital procurement framework for South African public sector: A content analysis approach

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

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.

Reducing asymmetric cost behaviors: Evidence from digital innovation

This study quantifies the impact of digital innovation on corporate performance, offering insights into the sustainability of digital innovation’s impact and providing guidance for firms embarking on their digital innovation journey. We examine the effect of digital innovation on cost stickiness using patent reports spanning from 2007 to 2022. The baseline analysis results reveal that digital innovation significantly mitigates cost stickiness in companies. This finding remains robust after addressing endogeneity concerns and conducting various robustness tests. We probe potential mechanisms and discover that digital innovation reduces cost stickiness by enhancing the quality of internal controls, improving resource-adjustment efficiency, and addressing managerial over-optimism. Heterogeneity analysis indicates a more pronounced impact of digital innovation on reducing asymmetric cost behaviors in larger firms, those beyond the growth stage, and in regions with active digital procurement, well-developed digital taxation governance, and sound judiciary infrastructures. Additionally, our expanded analysis confirms the financial benefits of digital innovation in reducing cost stickiness. A notable discovery is the negative correlation between digital transformation and cost stickiness within digitally innovative firms, underscoring the greater significance of digital innovation over mere digitization. Overall, this study significantly advances our understanding of how digital innovation influences cost management strategies.

The Impact of Governments’ Digital Economy Procurement on Rural Household Entrepreneurship

ABSTRACT Intangible digital technologies have advanced significantly over the past few decades. We examine the effects of government digital economy procurement programs on rural household entrepreneurship using data from the Chinese Household Finance Survey, China Grassroots Governance Survey, and Chinese government procurement data from 2015 to 2019. We find that the likelihood of rural household entrepreneurship is greatly increased by the government acquisition of products in the digital economy. Our mechanism analysis shows that government digital procurement could have an impact on rural household entrepreneurship by easing credit restrictions, encouraging the growth of distinctive industries, and improving government information disclosures. Furthermore, the effects of government procurement in the digital economy are particularly noticeable in counties characterized by e-commerce and industry integration. The paper offers insightful policy recommendations for the use of digital initiatives to support rural economic development in emerging economies.

Development of Sharia-Based Goods and Services Procurement Theory in a Digital Context: An Explorative Study

<em>This study aims to develop a theory of Sharia-based procurement of goods and services in a digital context. Through an exploratory qualitative approach, this study explores the understanding of Sharia principles, the implementation of these principles in the context of digital procurement, as well as related challenges and strategies. The research results show that a good understanding of Sharia principles is a key to successful implementation. The implementation of Sharia principles in digital procurement can enhance transparency and efficiency, although there are some challenges to be overcome. This study indicates that further research, the development of tools and methods, as well as training and education are crucial strategies in developing the theory of Sharia-based procurement of goods and services in a digital context.</em>

Impact of digital procurement on economic resilience of enterprises during COVID-19

The main objective of this paper was to determine whether digital procurement positively affected the economic resilience of firms in the manufacturing industry during the COVID-19 pandemic. Hence, qualitative research was conducted in Czech industrial enterprises by means of a questionnaire survey in 2021. Based on the research question, 3 hypotheses were formed, which focused on the impact that investing in digital procurement had on the economic resilience of enterprises in selected industries. The parametric two sample one-factor ANOVA and Pearson's Chi-squared test were used to test the hypotheses. The findings rejected the association between investment in digital procurement and the economic performance of the firm during the pandemic. They also failed to confirm the association between digital purchasing and economic resilience of businesses during the pandemic. Another important result was also that digitization of purchasing did not have a greater impact on the economic resilience of firms in the manufacturing industry compared to firms in the construction and agriculture sectors. The research results can be practically implemented in determining the expected benefits of digitizing procurement. The research implications are limited by the fact that it only investigates companies from the manufacturing industry in the Czech Republic and focuses exclusively on the period of the COVID-19 pandemic.

A Risk-Aware Approach to Digital Procurement Transformation

As the digital procurement transformation continues to evolve, it is crucial to adopt a risk-aware approach to ensure successful outcomes. This paper delves into the necessity of a risk-aware approach to digital procurement transformation, specifically focusing on the role of professional procurement management and the significance of supplier partnerships in the digital environment. The research aimed to examine the critical role of risk management in the digital transformation of procurement. A total of 318 respondents from Serbia participated in the study. The role of professional management in procurement must encompass risk management to guarantee success in digital procurement transformation. Furthermore, the study identified that adequate preparation, information, and training for individuals involved are crucial for a seamless transition to digital procurement. The digital transformation of procurement contributes to sustainability by enhancing efficiency, transparency, and collaboration across the supply chain, ultimately fostering environmentally conscious practices and responsible resource management. In summary, the research underscores the need for a comprehensive and risk-aware approach to digital procurement transformation, considering the pivotal roles of procurement professionals, supplier partnerships, and the integration of new technologies.

The Impact of Technology Adoption on Efficiency and Transparency in Public Procurement Processes in Kenya

In recent years, global public procurement has witnessed a paradigm shift with the integration of technology, a phenomenon embraced by countries like Kenya. The Kenyan government has actively modernized its procurement system through the adoption of e-procurement systems, blockchain, and artificial intelligence, aiming to bolster efficiency and transparency. The purpose of this research work was to assess the impact of technology adoption on efficiency and transparency in public procurement processes in Kenya. This research addressed a critical gap in understanding the nuanced impacts of these technological advancements on the intricate dynamics of public procurement in Kenya. Investigating the adoption's influence on efficiency and transparency, the study explored experiences, challenges, successes, and overall implications. The findings are of significance to public governance, offering insights to policymakers, practitioners, and technology developers. Aligned with global sustainable development initiatives, the study advocated for digital literacy training, cybersecurity measures, infrastructure improvement, policy incentives, a national digital procurement strategy, private sector collaboration, policy reviews, and data-sharing initiatives. By embracing the recommendations, Kenya can navigate challenges and capitalize on technology for an efficient, transparent, and resilient future in public procurement, aligning with the United Nations Sustainable Development Goals.

Digital procurement towards new performance frontiers: a systematic literature review and future research fronts

PurposeAs digital procurement continues to transform heavily as a value center and create new business models by linking businesses with a web of external partners, the full path to achieving such an all-encompassing thing is unknown. Thus, the study aims to explore the research gap through an exhaustive bibliometric and systematic literature review on the Digital procurement theme in the supply chain domain.Design/methodology/approachThis study is a qualitative and quantitative analysis of this field, using performance analysis and science mapping to examine 583 articles published from 2002 to 2021.FindingsA systematic literature review indicated core topics on “sustainable or green procurement” and “emerging landscape of technology” in the field of study.Research limitations/implicationsThough the Scopus database used for the analysis is the largest, it may not have complete coverage of all published articles in the field of study; thus, this study is a representation of only a sample rather than its entire population.Originality/valueOutcome is based on the review of the past 20 years’ contribution on the topic starting from 2002 to 2021.

A Relevance-Based Technology–Organisation–Environment Model of Critical Success Factors for Digital Procurement Adoption in Chinese Construction Companies

With the emergence of digital transformation, there is an increasing need for Chinese construction companies to adopt digital procurement (D-procurement). However, there is a lack of theoretical foundation to guide and support the adoption practices. This study aims to fill the research gap through the provision of a model by grouping a set of relevance-based critical success factors (CSFs) into the Technology–Organisation–Environment (TOE) framework for D-procurement adoption success (DAS). A case study approach is applied in the research. We selected H Group as it is one of the most representative D-procurement cases in China. The study includes two parts. In the first part, a systematic literature review was conducted, and 17 CSFs were identified from 12 selected studies. By grouping the 17 CSFs into the TOE framework, we put forward a basic CSF–TOE model. In the second part, an in-depth interview was carried out in H Group, where the 17 selected experts were asked to rank the previously identified CSF. Based on their order of relevance, the 17 CSFs were re-organised in the basic CSF–TOE model, and a relevance-based CSF–TOE model was finally proposed. This study is vital for D-procurement adoption because most existing CSF studies are based on the literature and questionnaire surveys, and there is a lack of actual case studies. In addition, this study significantly contributes to the field of D-procurement adoption for construction companies by providing a theoretical framework for practice and a relevance-based CSF–TOE model for research.

Benefits and Barriers of Digital Procurement: Lessons from an Airport Company

Implementing a well-integrated procurement system and applying uniform practices to achieve the strategic goals of any company is a complex phenomenon. Navigating the digital procurement systems in achieving supply-chain resilience remains a predicament. Framed within the technology acceptance model (TAM), which is a key model in understanding the predictors of human behaviour toward the potential acceptance or rejection of the technology. This study explored the benefits and barriers of digital procurement at Airports Company South Africa (ACSA). A qualitative approach in a form of a single holistic case study design was adopted. The sample involved 18 employees and individuals who were supply chain management (SCM), information technology (IT), and programme management office (PMO) professionals. Semi-structured interviews conducted focused on those with extensive experience on procurement, digital technologies, procurement automation or the implementation of transformation programmes. Digital procurement is a value-adding function at ACSA with the possibilities of providing cost reduction in the supply chain. However, the participants highlighted job losses, cyber security, lack of interoperability, lack of skills and system downtimes as obstacles affecting the adoption of digital procurement and as organizational barriers. The infusion of digital technologies into various aspects of organisational processes and outcomes remains a complex, dynamic, fluid, and volatile phenomenon. A framework highlighting critical focus areas when it comes to the adoption of digital procurement of digitalization is presented.

Myth or reality? The Digitalization of Climate-Smart Agriculture (DCSA) practices in smallholding agriculture in the Bono East Region of Ghana

Digitalization of Climate-Smart Agriculture practices leverages the power of digital agriculture tools/services (DATs) of any form (hardware, software, or data) in Climate-Smart Agriculture (CSA) practices to promote enhanced adaptation, GHGs emissions mitigation and increase productivity for smallholding agriculture. This research used a mixture of participatory and learning approaches with an emphasis on Expert Interviews and a Large-scale Household Survey involving 1219 farmers in the Bono East of Ghana to assess the awareness and utilization of DATs in smallholder farmers' CSA practices. Precisely, we assess farmers' engagement with Digital Agriculture Services (DAS) and DAT such as; TVs, Radios, Mobile phones/Tablets, Unmanned Aerial Vehicles (UAV)/Drones, Soil Sensor, Moisture Meters, Rain Gauges, Farm Management Software, Smartphone Applications, and Field Thermometers. The research suggests that the ubiquity of TVs, Radios, and feature phones in rural communities makes these tools the most used devices in farmers' climate-smart practices. However, the level of awareness, availability, accessibility, and utilization of complex tools such as UAVs and simpler tools such as soil sensors, moisture meters, field thermometers, rain gauges, smartphone applications (Facebook, WhatsApp, Twitter, etc.), and farm management software is minimal among rural farmers.The DAS facilitating farmers' climate-smart practices is limited to Digital Agroadvisory Purposes (digital extension), Agri-Digital Finance, and Digital Procurement services, while engagement with other DAS, such as Agri E-Commerce which facilitates most CSA Institution/Market Smart practice, is non-existing in rural communities. In addition, the Digitalization of Climate-Smart Agriculture, in its present form, is only limited to a few CSA practices and DATs engagement among smallholders owing to unmet training and information needs for most Climate-Smart Agriculture practices and interventions. Challenges such as DATs' unavailability, inaccessibility, high cost, high (digital)illiteracy, and inadequate extension support for the digitalization of CSA practices limit uptake. The study proposes increased capacity building for smallholders on CSA practice and interventions. Likewise, a strong public–private partnership across multiple scales is needed to stimulate needed investment to enhance farmers' access to affordable, easy-to-use, and tailor-made DATs while recognizing the power dependence and inequalities these digital tools may unleash in rural communities. Finally, increasing sensitization on DAT's use and benefits in rural communities and the larger population is critical to enhancing the widespread Digitalization of Climate-Smart Agriculture practices in smallholding agriculture.

Dynamic capabilities for digital procurement transformation: a systematic literature review

PurposeThe purpose of this paper is to achieve a collective understanding of the capabilities required for digital procurement transformation (DPT).Design/methodology/approachThe authors contextualize theory about dynamic capabilities (DCs) to integrate the fragmented body of literature on procurement digitalization by means of a systematic literature review (SLR). By extracting and clustering capabilities, as well as proven performance outcomes from existing literature in the field, the authors develop a conceptual model of the DCs required for DPT.FindingsThe authors first introduce and define DPT and the corresponding motivations that trigger firms to invest in advanced digital technologies. Second, by adopting the DC lens, the authors provide an overview of nine microfoundations required for DPT and highlight the strategic options procurement leaders can use when strategizing about adopting combinations of digital technologies. Third, the authors present a future research agenda on DCs for DPT.Research limitations/implicationsThe developed conceptual model must be verified and enhanced through further empirical research.Practical implicationsThe conceptual model can be used by procurement leaders as a starting point and framework when strategizing about digitally transforming the procurement organization.Originality/valueThe study is the first to synthesize previous research findings on procurement digitalization through an SLR in order to develop a fine-grained conceptual model that supports practitioners and researchers alike in better understanding the capabilities required for and potential performance outcomes of DPT.

Penerapan Aplikasi Pegadaian Digital (PDS) dalam Pelayanan PT Pegadaian UPC Plasa Millenium Sebelum Dan Pada Masa Covid-19

In the current pandemic, direct transactions between companies and customers must be reduced to help the government suppress the spread of COVID-19. So that PT Pegadaian is more focused on marketing and sales activities on social media and applications that support every transaction with customers. However, direct transaction activities at pawn shops are still quite crowded by customers who want to make transactions. This study used descriptive qualitative method. This study uses primary data sourced from employees and customers of PT Pegadaian UPC Plasa Millennium. The use of the Digital Pegadaian (PDS) application in 2019 – 2020 has increased. Many customers know about the Digital Pegadaian (PDS) application at PT Pegadaian UPC Plasa Millennium. Some customers just download the app and don't use it at all. The PT Pegadaian UPC Plasa Millennium party improves education and services on how to use the Digital Procurement application as a non-cash payment tool during the covid-19 pandemic

The Impact of Digital Transformation on Supply Chain Procurement for Creating Competitive Advantage: An Empirical Study

This study examined the impact of digital transformation (DT) on supply chain procurement (SCP) for the creation of competitive advantage (CAD). This study adopted a quantitative approach using a survey administered to 221 supply chain (SC) professionals through the professional networking website LinkedIn. The conceptual model was evaluated with the partial least squares-based structural equation model (PLS-SEM) using SmartPLS. The findings showed that DT has significant positive impacts on SCP and CAD, and that SCP has a significant positive impact on CAD. Supply chain procurement plays a significant mediating role in the relationship between DT and CAD. The findings are useful for decision-makers investing in digitally modernising their SC processes. The study recommends starting the DT of an SC with procurement, as procurement is a complex process involving a wide range of internal and external stakeholders. The results show that digital procurement may be an SC game changer in a competitive market. The study provides initial guidelines for a transition from traditional to smart procurement (procurement 4.0). Despite the prevalence of studies on SCP, there is a lack of empirical evidence on how DT of procurement functions can lead to sustainable CAD.

Assessing public organic food procurement: the case of Zurich (CH)

Organic food is increasingly promoted among authorities and governments to tackle global sustainability challenges and support an agri-ecological transition. An important policy instrument in this endeavour is the purchase of food or food services by public institutions, the so-called public food procurement (PFP). While PFP policies often promote organic food, few studies quantify the actual share of organic products in PFP systems. This study applies an adapted city food flow analysis to evaluate the organic share of 12 product groups in public catering, using Zurich as a case study. Based on a typology of procurement channels, we show that Zurich’s PFP system is highly centralised with internal coordinated procurement (INT–coord) and external coordinated procurement (EX–coord) providing 70% and 25% of total annual meals respectively. As Zurich procures 11% (INT–coord) and 9% (EX–coord) of organic produce, the city has considerable potential to increase organic PFP. Leverage points to this aim include internal product-specific thresholds, supply development and developments in digital procurement. This study provides a methodology to conceptualise municipal PFP systems and measure city-wide levels of organic PFP. The insights from Zurich offer a blueprint for PFP systems in other municipalities and reveal potential challenges when defining and monitoring organic PFP policies based on total purchases.

Modelling procurement problems in the environment of blockchain technology

In the highly competitive business environment, Supply chain (SC) disruption strongly impacted the manufacturing cost. The poor goods management and bottleneck have muddled the SC. It leads to cross-delivery, wastage of delivery time, burglary, quality and sometimes damages to the essential and precious goods. Only digitisation can be seen as an alternative to neutralise these obstacles from the procurement problems in SC. Security, immutable data, traceability, and transparency are the significant goal of the digital supply chain (DSC), which can only cut down the operational cost and are decisive factors for meeting the customer demand in real-time without disrupting the smooth flow of information. The rising concern towards cross-delivery, delivery delay time, hacking of data, transparency, intermediated and burglary have forced us to integrate blockchain technology (BCT) with the traditional supply chain. This work presents the DSC’s integrated mathematical model, transforming traditional procurement problems into digital procurement. This research paper optimises the procurement cost after adopting and integrating the blockchain (an infancy technology). The proposed model is a Mixed Integer-Linear programming mathematical model that incorporates the block development cost while purchasing, ordering, transporting and holding processes. These four processes are the susceptible stages where leakage can be reported; therefore, an integrated MILP model is proposed to eradicate the leakage from the system and endorse transparency, traceability, and immutable information for DSC. Finally, the model is authenticated and verified over the three different scenarios illustration using the LINGO 10.0 software for digital procurement problems based on the randomly generated datasets.

Information Asymmetry in Business-to-Business Negotiations: A Game Theoretical Approach to Support Purchasing Decisions with Suppliers

The digital transformation confronts purchasing and supply management (PSM) with numerous new challenges, such as digital procurement objects and the information asymmetry between buyers and suppliers. Existing approaches contributing to PSM research (e. g., the selection of suppliers or the calculation of equilibrium prices) have in common that information regarding suppliers (e. g., production costs) must be well-known. However, this information is rarely accessible to purchasers due to the existing information asymmetry. This problem is addressed by a game-theoretical model based on a Stackelberg game to assist PSM in dealing with the information advantage of software suppliers. The applicability in practice is evaluated by a real-world case study from the automotive industry. The results show that the presented model can support decision-making in purchasing by a qualitative analysis of profit scenarios for different negotiation strategies. The model contributes to dismantling the information asymmetry and provides a basis for determining negotiation prices, also for digital procurement objects. This research motivates both supply and purchase managers to jointly optimize their product costs and thus increase their competitiveness on the market.

Identifying Emerging Risks in Digital Procurement Governance

Identifying Emerging Risks in Digital Procurement Governance

The effect of digital procurement and supply chain innovation on SMEs performance

Technological changes accompanied by rapid market changes have made it increasingly difficult for SMEs to develop their business in the future. Today, many organizations are shifting to e-procurement as an integrated supply chain support function to achieve strategic business goals. E-procurement or electronic procurement and supply chain Innovation have allowed for more flexibility in responding to market changes and improving the performance of the company's supply chain. The purpose of this study was to determine the impact of the implementation of e-procurement and supply chain innovation on the supply chain performance of SMEs in Indonesia. The method used in this study is a quantitative survey method using structural equation modeling (SEM) and partial least squares (PLS) with data processing tools, namely SmartPLS 3.0 software. Respondents in this study were 390 employees of SMEs in Indonesia determined by the simple random sampling method. The research data was obtained through an online questionnaire distributed through social media. From the results of the analysis, it can be concluded that the implementation of e-procurement has a significant effect on supply chain performance. Supply Chain Innovation has also a significant influence on SMEs supply chain performance.