Toward a measure of competitive priorities for purchasing

Abstract The purpose of this paper is to develop a set of measures of purchasing’s competitive priorities. We maintain that purchasing is a strategic contributor to the firm, and that the selection and retention of external suppliers is a fundamental and strategic purchasing task that manifests the function’s competitive priorities. Researchers and managers increasingly view the operations and purchasing functions as intimately linked, and as playing important roles in supply chain management. Ultimately, the performance of the operations management system, measured in terms of quality, cost, delivery and flexibility, depends on inputs secured by the purchasing function from the firm’s suppliers. However, in a search for substantive relationships, the purchasing literature has largely overlooked methodological issues such as measurement. Using empirical data collected from North American purchasing executives, a confirmatory factor analysis provides evidence that purchasing’s competitive priorities may be conceptualized similarly to the competitive priorities in operations, with key differences. The measures satisfy key measurement criteria including unidimensionality, convergent validity, discriminant validity, and reliability. Five competitive priorities form the basis of a multidimensional measure of purchasing’s competitive priorities, the individual factors of which will allow for the examination of linkages between purchasing, operations and other parts of the supply chain.