Articles
International purchasing offices: Literature review and research directions

https://doi.org/10.1016/j.pursup.2013.09.002Get rights and content

Highlights

  • We develop the first literature review on the “International Purchasing Offices” topic.

  • We collect, systematise and summarise 59 works, proposing a conceptual framework.

  • We discuss distribution of papers by method, theory, geographical area, and topic.

  • We identify various theoretical and methodological gaps of the literature.

  • We provide research directions related to topics, theories and methodological aspects.

Abstract

International Purchasing Offices (IPOs) now play an increasingly important role in the management of international sourcing activities, both in developed and emerging economies. The relevance of this organisational solution and the relatively limited research that has been published so far in the P&SCM literature make the “IPO” topic particularly promising for future research. This paper – based on an analysis of 59 works published between 1991 and 2011 – provides the first comprehensive literature review and research agenda on this topic. The primary issues (i.e., IPO definition, activities, location choices, strengths, weaknesses, and human resources management) are identified, and a conceptual framework is proposed. Building on this analysis, some theoretical and methodological weaknesses of the existing works and some gaps in the literature are discussed. This work concludes by suggesting several future research directions.

Introduction

Over the past several decades, international (or global) sourcing has been a major trend (Christopher et al., 2011, Jahns et al., 2006, Javalgi et al., 2009). Market globalisation, the increasing interdependence among world economies, the increasing international competition, the development of information and communication technologies, and the removal of international trade barriers have led many companies to source goods and services from outside their national borders (Arnold, 1999, Ellram et al., 2008, Kotabe and Murray, 1990). In recent years, this development has attracted increasing interest from both academic and managerial circles (Benito et al., 2013, Lahiri and Kedia, 2011).

Several studies (e.g., Trent and Monczka, 2003) have shown that the selection of appropriate entry modes for foreign supply markets is essential to manage the complexity of international sourcing activities, which is caused by cultural heterogeneities, the presence of multiple actors, relationships with different and distant interlocutors, and unfamiliar business rules and behaviours. A possible solution is the establishment of an International Purchasing Office (IPO). Since the 1990s, IPOs have been mentioned in a number of scientific works. References to IPOs are even more common in the non-academic literature.

Nevertheless, none of the literature reviews pertaining to topics such as “international sourcing”, “global operation”, “international supply chain management”, or “import activities” (e.g., Aykol et al., 2013, Burgess et al., 2006, Meixell and Gargeya, 2005, Quintens et al., 2006) have tackled IPOs. Therefore, there is a need to revisit and review the works published in the past 20 years on the “IPO” topic, which in our view, leave ample room for development.

The aim of this work is to develop the first systematic literature review on IPOs, identify major gaps in the literature, and provide suggestions for future studies.

This paper contributes to the study of purchasing and supply management (P&SCM) in the following ways: (1) it collects, systematises, and summarises the existing literature on IPOs; (2) it analyses the distribution of papers by adopted methodologies, underpinning theories, geographical areas analysed, and topics; (3) it identifies various thematic, theoretical, and methodological gaps; and (4) it provides a set of suggestions related to emerging issues.

This work is structured as follows. After a discussion of the relevance of the topic (Section 2) and a description of the methodological approach of this review (Section 3), there is a classification of the reviewed works (Section 4). Section 5 focuses on the primary research issues concerning IPOs. Finally, the paper identifies some methodological weaknesses and gaps in the literature and suggests specific research directions (Section 6).

Section snippets

The relevance of IPOs and international sourcing

The literature shows that today more than ever, international sourcing (IS) is considered to be a strategic opportunity to achieve a sustainable competitive advantage (e.g., Grandinetti et al., 2009, Hultman et al., 2012).

Data show the relevance of international sourcing growth of both merchandise and commercial services. The volume of world merchandise sourcing increased by 5% in 2011 and 3.7% annually, on average, from 2005 to 2011 (i.e., its increase was greater than the 2.3% annual growth

Literature review approach

To ensure rigour, objectivity, and transparency in the research process and to obtain replicable and valid results, we performed a systematic literature review following the methodology that has been proposed by Rousseau et al. (2008) and Tranfield et al. (2003).

The general aim of a literature review is to give a critical overview of the existing knowledge in a field of enquiry; its format and scope may vary from discipline to discipline, from topic to topic, and even from research question to

Descriptive findings

In this section, we present some descriptive analyses of the reviewed works: distribution of the works by adopted methodologies, underpinning theories, geographical areas involved, and main research topics.

The most common adopted methodology in the scientific works is the case study (52%). This can be partially justified by the fact that the topic is at an early stage of research. Among the six available surveys, only two have used samples in which it was possible to isolate empirical evidence

Thematic findings

This section presents the six research themes identified in the literature review.

Agenda for future IPO research

The extensive review and synthesis of the IPO literature (presented in 4 Descriptive findings, 5 Thematic findings) allows us to highlight some methodological weaknesses and gaps in the research on the IPO topic. First, the theoretical foundations of IPO literature are lacking. We have shown that only six (out of 25) scientific papers are built on existing theories. Second, the IPO research tends to be affected by problems of methodological rigour. The research protocol (e.g., sample selection

Conclusions

The establishment of bridgeheads in foreign supply regions seems to be an essential step in the internationalisation path of firms. In the last decade, the creation of International Purchasing Offices has become one of the strategies most frequently adopted for managing international sourcing activities (Monczka et al., 2008).

This paper reported on the state of the literature about this organisational solution. We collected 59 contributions published in academic journals (25), practitioner

References (140)

  • E. Hartmann et al.

    Organisational design implications of global sourcing: a multiple case study analysis on the application of control mechanisms

    Journal of Purchasing and Supply Management

    (2008)
  • M. Holweg et al.

    On risk and cost in global sourcing

    International Journal of Production Economics

    (2011)
  • J. Hultman et al.

    An interaction approach to global sourcing: a case study of IKEA

    Journal of Purchasing and Supply Management

    (2012)
  • C. Jahns et al.

    Offshoring: dimensions and diffusion of a new business concept

    Journal of Purchasing and Supply Management

    (2006)
  • R.G. Javalgi et al.

    Outsourcing to emerging markets: theoretical perspectives and policy implications

    Journal of International Management

    (2009)
  • K.L. Johnson et al.

    The view from the field: a case study of the expatriate boundary-spanning role

    Journal of World Business

    (2010)
  • N. Julka et al.

    A review of multi-factor capacity expansion models for manufacturing plants: searching for a holistic decision aid

    International Journal of Production Economics

    (2007)
  • L.A. Knight et al.

    Managing supply networks: organizational roles in network management

    European Management Journal

    (2005)
  • S. Lahiri et al.

    Co-evolution of institutional and organizational factors in explaining offshore outsourcing

    International Business Review

    (2011)
  • R. Lamming

    Japanese supply chain relationships in recession

    Long Range Planning

    (2000)
  • Y. Laurans et al.

    Use of ecosystem services economic valuation for decision making: questioning a literature blindspot

    Journal of Environmental Management

    (2013)
  • L.C. Leonidou

    Export Stimulation Research: review, evaluation and integration

    International Business Review

    (1995)
  • M.J. Meixell et al.

    Global supply chain design: a literature review and Critique

    Transportation Research Part E

    (2005)
  • G. Nassimbeni et al.

    Sourcing in China: a typology

    International Journal of Production Economics

    (2007)
  • R. Adams et al.

    Innovation management measurement: a review

    International Journal of Management Reviews

    (2006)
  • A.G. Akyuz et al.

    Supply chain performance measurement: a literature review

    International Journal of Production Research

    (2010)
  • V.L. Allen et al.

    Role Transitions: Explorations and Explanations

    (1984)
  • E. Anderson et al.

    International market entry and expansion via independent or integrated channels of distribution

    Journal of Marketing

    (1987)
  • Anonymous, 2010. Update on international procurement. Chaina (November/December),...
  • S. Agarwal et al.

    Choice of foreign market entry mode: impact of ownership, location and internalization factors

    Journal of International Business Studies

    (1992)
  • S. Avery

    Global purchasing sharpens Schneider's competitive edge

    Purchasing

    (2002)
  • S. Avery

    Transforming textron

    Purchasing

    (2002)
  • B. Aykol et al.

    Research on the import activities of firms 1960–2010

    Management International Review

    (2013)
  • Bani, E., 1999. Foreign investments continue unabated (HL). Business Times...
  • K. Burgess et al.

    Supply chain management: a structured review and implications for future research

    International Journal of Operations and Production Management

    (2006)
  • P.M. Byrne

    Global sourcing: opportunities and approaches for the 21st century

    Logistics Management

    (2005)
  • J. Carbone

    Where are the next hot spots?

    Purchasing

    (2002)
  • J. Carbone

    Industry in infancy

    Purchasing

    (2006)
  • C. Carduck

    International Procurement Offices

    (2000)
  • J.L. Cavinato

    A total cost/value model for supply chain competitiveness

    Journal of Business Logistics

    (1992)
  • A. Chia et al.

    Performance measurement in supply chain entities: balanced scorecard perspective

    Benchmarking: an International Journal

    (2009)
  • D. Chicksand et al.

    Theoretical perspectives in purchasing and supply chain management: an analysis of the literature

    Supply Chain Management: An International Journal

    (2012)
  • M. Christopher et al.

    Approaches to managing global sourcing risk

    Supply Chain Management: An International Journal

    (2011)
  • R.H. Coase

    The nature of the firm

    Economica

    (1937)
  • L.M. De Menezes et al.

    Flexible working and performance: a systematic review of the evidence for a business case

    International Journal of Management Reviews

    (2011)
  • Dobson, W., Yue, C.S., 1997. Multinationals and East Asian Integration. International Development Research Centre,...
  • J.H. Dunning

    Explaining International Production

    (1988)
  • V.J. Duriau et al.

    A content analysis of the content analysis literature in organization studies: research themes, data sources, and methodological refinements

    Organizational Research Methods

    (2007)
  • K.M. Eisenhardt

    Agency theory: an assessment and review

    Academy of Management Review

    (1989)
  • L.M. Ellram

    Total cost of ownership: elements and implementation

    International Journal of Purchasing and Materials Management

    (1993)
  • Cited by (0)

    1

    Tel.: +39 0432 558043; fax: +39 0432 558251.

    2

    Tel.: +39 0432 558333.

    3

    Tel: +44 1392 722125.

    View full text