Purchasing-logistics integration and supplier performance: an information-processing view

Abstract

Purpose The purpose of this paper is to develop a purchasing-logistics integration (PLI) conceptualization along two dimensions: mutual responsibility and integrative efforts. This conceptualization is then tested as to whether it provides any insights for supplier performance. Design/methodology/approach Information-Processing Theory is used to posit hypotheses linking the dimensions of PLI with various measures of supplier performance. Hypotheses are then tested with a dyadic data set of purchasing and logistics managers, using multiple regression methods. Findings Purchasing managers found mutual responsibility to positively influence supplier delivery speed, whereas logistics managers found it to positively influence supplier price performance. Generally speaking, purchasing managers perceived a stronger linkage between formal integrative efforts (liaison roles and joint reward systems) and supplier performance, whereas logistics managers perceived this linkage to be stronger for informal integrative efforts such as information exchange and collaboration. Research limitations/implications Study results are cross-sectional in nature and consist of three major industry groupings. The dyadic data were analyzed separately to avoid significant data loss. Practical implications Supply chain managers will find the areas where purchasing and logistics managers overlap in their perceptions (as well as where they differ) useful. In addition, an understanding of how PLI influences supplier performance should help improve organizational effectiveness. Originality/value PLI is a highly important, yet understudied, internal connection. This study provides a useful framework in helping academics and practitioners better understand this crucial internal connection, and how it relates to the performance extracted from suppliers.