Showing papers on "Procurement published in 2018"

Supply chain management and the circular economy: towards the circular supply chain

Abstract: Circular modes of production, known as the circular economy, are welcomed in political and business circles to overcome the shortcomings of traditional linear operating models. This article presents preliminary propositions concerning implications for the development of what we term ‘circular supply chains’, defined here as the embodiment of circular economy principles within supply chain management. Our propositions are based on the following arguments: a shift from product ownership to leasing and access in supply chain relationships; the relevance of structural flexibility and start-ups in regional or local loops; open and closed material loops in technical and biological cycles; closer collaboration within and beyond immediate industry boundaries and public and private procurement in the service industry as a lever for the scaling up of circular business models. We discuss what these circular economy principles mean in terms of supply chain challenges and conclude with limitations and future research agenda.

Public–private partnership in Public Administration discipline: a literature review

Abstract: Public–private partnerships (PPPs) have become popular tools to deliver infrastructure and public services around the world. As an innovative public procurement approach, PPPs have drawn considerab...

Procurement 4.0: factors influencing the digitisation of procurement and supply chains

Abstract: While digitisation is a key driver of the fourth industrial revolution (Industry 4.0); organisations have different approaches to deal with this topic to get a clearer picture of the opportunities and challenges concerning the digital transformation. The purpose of this paper is to identify the impact of digitisation on procurement and its role within the area of supply chain management. The research will also explore potential barriers to digitising procurement and supply chains and ways to overcome them. Finally, the significance of potential enabling technologies to the digitisation will also be examined.,A quantitative approached utilising an online survey was used to collect the primary data for this study. Data were collected from 414 participants directly involved with procurement or related business functions and work for different organisations in different industries. The survey included eight items about the impact of digitisation on organisational performance in the area of procurement and supply chains; ten items related to key barriers to digitisation of organisations and ways to overcome them; and seven items about enabling technologies to leverage procurement procedures and processes digitisation. All of these items utilised the Likert five-point level of agreement scale.,The findings indicate that digitisation of procurement process can yield several benefits including: supporting daily business and administrative tasks, supporting complex decision-making processes, procurement will become more focussed on strategic decisions and activities, procurement will become a strategic interface to support organisational efficiency, effectiveness, and profitability, and supporting the creation of new business models, products, and services. The authors were also able to confirm that there are barriers to digitising procurement process and supply chains and such barriers found in existing procedures, processes, capacities, and capabilities. Finally, the significance of a number of enabling technologies to the digitisation process was revealed.,To the best of the authors’ knowledge, this is the first study of its kind with participants located world-wide. Industry 4.0 as a topic had been explored within different business areas and functions but very limited research specifically explored potential impact, barriers, and enabling technologies of procurement 4.0. The results can be beneficial for organisations already implemented Industry 4.0 or planning to do so. The study can also benefit academic scholars interested in the researched topic, business professionals, organisations within different sectors, and any other party interested in understanding more the concept of procurement 4.0.

Advancing to a Circular Economy: three essential ingredients for a comprehensive policy mix.

Abstract: Material resources exploitation and the pressure on natural ecosystems have raised concerns over potential future resource risks and supply failures worldwide. Interest in the concept of Circular Economy has surged in recent years among policy makers and business actors. An increasing amount of literature touches upon the conceptualisation of Circular Economy, the development of ‘circular solutions’ and circular business models, and policies for a Circular Economy. However, relevant studies on resource efficiency policies mostly utilise a case-by-case or sector-by-sector approach and do not consider the systemic interdependencies of the underlying operational policy framework. In this contribution, a mapping of the existing resource policy framework in the European Union (EU) is undertaken, and used as a basis for identifying policy areas that have been less prominent in influencing material resource efficiency. Employing a life cycle approach, policies affecting material efficiency in the production and consumption stages of a product have been found to be poorly utilised so far in the EU. Taking this as a point of departure, three policy areas that can contribute to closing material loops and increasing resource efficiency are thoroughly discussed and their application challenges are highlighted. The three policy areas are: (1) policies for reuse, repair and remanufacturing; (2) green public procurement and innovation procurement; and (3) policies for improving secondary materials markets. Finally, a potential policy mix, including policy instruments from the three mentioned policy areas—together with policy mixing principles—is presented to outline a possible pathway for transitioning to Circular Economy policy making.

Opportunities for Use of Blockchain Technology in Medicine

Abstract: Blockchain technology is a decentralized database that stores a registry of assets and transactions across a peer-to-peer computer network, which is secured through cryptography, and over time, its history gets locked in blocks of data that are cryptographically linked together and secured. So far, there have been use cases of this technology for cryptocurrencies, digital contracts, financial and public records, and property ownership. It is expected that future uses will expand into medicine, science, education, intellectual property, and supply chain management. Likely applications in the field of medicine could include electronic health records, health insurance, biomedical research, drug supply and procurement processes, and medical education. Utilization of blockchain is not without its weaknesses and currently, this technology is extremely immature and lacks public or even expert knowledge, making it hard to have a clear strategic vision of its true future potential. Presently, there are issues with scalability, security of smart contracts, and user adoption. Nevertheless, with capital investments into blockchain technology projected to reach US$400 million in 2019, health professionals and decision makers should be aware of the transformative potential that blockchain technology offers for healthcare organizations and medical practice.

Supply chain resilience for single and multiple sourcing in the presence of disruption risks

Abstract: This paper investigates the use of sourcing strategies to achieve supply chain resilience under disruptions. The coping strategies considered are single and multiple sourcing, backup supplier contracts, spot purchasing, and collaboration and visibility. Collaboration and visibility, which affect suppliers’ recovery capabilities and a buyer’s warning capability, have not been similarly modelled in the past. A scenario-based mathematical model is developed such that it considers objectives under uncertainties including disruption risks and operational risks. A broad numerical study examines its output for various risk attitudes in a decision-maker, ranging from risk neutral to risk averse. The sensitivity of procurement strategies to other key parameters such as recovery and warning capabilities is examined. One of the major findings is that buyer’s warning capability plays a vital role in enhancing supply chain resilience. We seek to build on these efforts to further support disruption planning and mitigat...

Competing for government procurement contracts: The role of corporate social responsibility

Abstract: Research Summary: This study examines whether corporate social responsibility (CSR) improves firms’ competitiveness in the market for government procurement contracts To obtain exogenous variation in firms’ social engagement, I exploit a quasi‐natural experiment provided by the enactment of state‐level constituency statutes, which allow directors to consider stakeholders’ interests when making business decisions Using constituency statutes as instrumental variable (IV) for CSR, I find that companies with higher CSR receive more procurement contracts The effect is stronger for more complex contracts and in the early years of the government‐company relationship, suggesting that CSR helps mitigate information asymmetries by signaling trustworthiness Moreover, the effect is stronger in competitive industries, indicating that CSR can serve as a differentiation strategy to compete against other bidders Managerial Summary: This study examines how companies can strategically improve their competitiveness in the market for government procurement contracts—a market of economic importance (15–20% of GDP) It shows that companies with higher social and environmental performance (CSR) receive more procurement contracts This effect is stronger for more complex contracts, in the early years of the government–company relationship, and in more competitive industries These findings indicate that firms’ CSR can serve as a signaling and differentiation strategy that influences the purchasing decision of government agencies Accordingly, managers operating in the business‐to‐government (B2G) sector could benefit from integrating social and environmental considerations into their strategic decision making

Policy mechanisms to accelerate electric vehicle adoption: A qualitative review from the Nordic region

Abstract: Electric vehicles are an important instrument to decarbonize transportation, offering a range of co-benefits such as reductions in local pollution, noise emissions, and oil dependency. Unfortunately, price, range, infrastructure and technological uncertainty are only some of the barriers to a faster adoption of these vehicles. To overcome these barriers, there is a broad call for public support and a growing body of primarily survey and choice experiment studies to show which policy mechanisms are effective, with mixed outcomes. In response, this paper offers a qualitative comparative analysis that draws on 227 semi-structured interviews with 257 transportation and electricity experts from 201 institutions across 17 cities within the Nordic region to discuss the reasoning and arguments behind EV incentives and policy mechanisms. A frequency analysis of the most coded responses favoured cost reduction mechanisms, in particular taxation exemptions; infrastructure support for public and apartment charging; the importance of consumer awareness, especially information campaigns; certain other specific policy measures like procurement programs and environmental zones; and more general policy principles. More in-depth, our analysis shows the debates around these mechanisms and how the pros and cons of these mechanisms differ per country, per transport segment, per phase of transition or market share, even per city. In short, this paper calls for strong stable national targets and price incentives combined with local flexibility to implement secondary benefits and more attention to awareness campaigns to advance the implementation of electric vehicles.

Life Cycle Assessment and Costing Methods for Device Procurement: Comparing Reusable and Single-Use Disposable Laryngoscopes.

Abstract: BACKGROUND:Traditional medical device procurement criteria include efficacy and safety, ease of use and handling, and procurement costs. However, little information is available about life cycle environmental impacts of the production, use, and disposal of medical devices, or about costs incurred af

Integrated relief pre-positioning and procurement planning in humanitarian supply chains

Abstract: Humanitarian organizations typically pre-position relief items in strategic locations whose optimum levels are affected by the amounts of pre-disaster contractual agreements and post-disaster procurements. To account for these interrelationships, this paper proposes a novel two-stage scenario-based mixed fuzzy-stochastic programming model for integrated relief pre-positioning and procurement planning based on a quantity flexibility (QF) contract under a mixture of uncertain data. An effective multi-step solution method is also devised to solve the problem in real-sized instances. Applicability of the proposed model is examined through a real case study. Finally, a number of sensitivity analyses are conducted to provide helpful managerial insights.

Unveiling barriers to sustainable public procurement in emerging economies: Evidence from a leading sustainable supply chain initiative in Latin America

Abstract: In light of the Theory of Ecological Modernisation, this is the first work to explore the organisational barriers affecting one of the most significant sustainable public procurement initiatives in Latin America: the Brazilian Environmental Agenda for Public Operations Management (the ‘A3P Programme’). This article explores the barriers to sustainable procurement in a Brazilian context, inspired by the work of Brammer and Walker (2011). Based on the results of a survey of programme managers, our first recommendation is to group the barriers to sustainable procurement into five categories: organisational culture, motivation, economic uncertainty, market, and operations. Amongst these, it was found that organisational culture stands out as a particular barrier to sustainable public procurement. This work also highlights Ecological Modernisation Theory as a useful tool for understanding why variables related to cost and budget are not barriers to implementing sustainable public procurement initiatives. Consequently, the main implication of this study is that government should consider cultural change management when developing sustainability management initiatives.

Real-Time Procurement Strategies of a Proactive Distribution Company With Aggregator-Based Demand Response

Abstract: In this paper, we present a real-time trading framework for distribution networks where a rational aggregator is identified as a broker by contracting with individual demands and dealing with the distribution company. Demand response capability is characterized by the coexistence of elastic and inelastic demand components. A one-leader multi-follower bi-level model is proposed to derive the procurement strategies, i.e., the upper-level problem intends to maximize the profit of the proactive distribution company, while the lower-level expresses the profit maximization per rational aggregator. The proposed model is then transformed into a solvable mathematical program with equilibrium constraints through a primal-dual approach. A modified 33-bus distribution network is utilized to demonstrate the effectiveness of the proposed model.

The Impacts of Markets and Tax on a Multinational Firm's Procurement Strategy in China

Abstract: Motivated by observations in the greater China region, this paper studies a multinational firm (MNF)'s preferences between two procurement strategies in a global business environment. The MNF relies on a contract manufacturer (CM) to produce its products, which serve both markets within (domestic market) and outside (overseas market) China. The MNF is assumed to be monopolistic in the overseas market but faces competition from a local original equipment manufacturer (OEM) who outsources both manufacturing and component procurement to the CM. The MNF will decide whether to control its component procurement (consignment strategy) or delegate that function to the CM (turnkey strategy). Our study indicates that a number of factors unique to the global supply chain environment, such as a multi-market structure with different sizes and natures of competition, and a set of tax rules that gives differential treatment to products serving different markets, have the potential of impacting the MNF's choice of consignment vs. turnkey strategies, sometimes in interesting ways. In particular, we find that when attempting to balance the pros and cons of cooperating with the local OEM under turnkey while competing against it in the domestic market, the MNF's preference could switch twice from turnkey to consignment and back to turnkey, and its global profits could first decrease and then increase, as the domestic market grows. Our study also highlights the importance of making a company's global supply chain management decisions while considering international tax rules.

A Multi-Objective Optimization Approach to Risk-Constrained Energy and Reserve Procurement Using Demand Response

Abstract: The large-scale integration of wind generation in power systems increases the need for reserve procurement in order to accommodate its highly uncertain nature, a fact that may overshadow its environmental and economic benefits. For this reason, the design of reserve procurement mechanisms should be reconsidered in order to embed resources that are capable of providing reserve services in an economically optimal way. In this study, a joint energy and reserve day-ahead market structure based on two-stage stochastic programming is presented. The developed model incorporates explicitly the participation of demand side resources in the provision of load following reserves. Since a load that incurs a demand reduction may need to recover this energy in other periods, different types of load recovery requirements are modeled. Furthermore, in order to evaluate the risk associated with the decisions of the system operator and to assess the effect of procuring and compensating load reductions, the Conditional Value-at-Risk metric is employed. In order to solve the resulting multi-objective optimization problem, a new approach based on an improved variant of the epsilon-constraint method is adopted. This study demonstrates that the proposed approach to risk management presents conceptual advantages over the commonly used weighted sum method.

One Belt One Road Initiative of China: Implication for Future of Global Development

Abstract: One Belt One Road (OBOR) initiative is a historical initiative which connects the people over the world and facilitates various opportunities for global peace. The main purpose of this study is to explore implication of One Belt One Road initiative for global future development. It also analyzes the reasons of origin, strategy, opportunities and challenges of OBOR initiatives on the basis of business, economic, political, social and environmental aspects. This study uses qualitative approach and secondary data particularly journal articles, conference proceedings, various documents of government, books, newspaper articles, magazine articles, and various websites of internet have been extensively used to determine the objectives. This article argues that partner countries and agencies will get economic and political benefits from these initiatives. It facilitates to connect people through road ways, air ways and water ways, coordinating policies of various governments, financial integration through cross border business, productivity and regional energy security. This study also analyzes risks and challenges associated to OBOR initiative implementation. It suggests that strong coordination among partners of OBOR is necessary to get full fruits of OBOR through supportive law, policy, rules and regulations, proper strategy implementation, transparent procurement system, sincere consideration on political, financial, environmental and social factors.

Coordination of relief items procurement in humanitarian logistic based on quantity flexibility contract

Abstract: Nowadays, coordination of relief items procurement in humanitarian logistics has become one of the main challenges of disaster management. In this paper, we utilize a quantity flexibility contract (QFC) to coordinate ordering activities in a three-echelon relief chain. This multi-echelon supply chain consists of a relief organization (i.e., NGO), one relief item supplier, and affected areas. In the proposed QFC, initially, the relief organization places an order before the disaster strikes and is committed to purchasing the initial quantity no less than a previously agreed amount. On the other hand, the supplier is committed to providing up to a certain amount above the initial order, if needed. Expected profit functions of relief chain members include transportation cost, inventory cost, the manufacturing cost of relief items, shortage cost, salvage value, and satisfaction level of affected areas. Our findings show that, under demand uncertainty, the proposed QFC not only prevents significant losses at relief organization but also enhances satisfaction level of the affected areas. Finally, the performance of the proposed coordination model is examined via various numerical experiments and managerial insights are extracted.

Adoption of the Internet of Things technologies in business procurement: impact on organizational buying behavior

Abstract: The purpose of this paper is to discuss the potential of Internet of Things (IoT) to affect organizational buying behavior Potential impacts on organizational communication, buying center structure and processes and privacy and security issues are discussed,This is a conceptual paper that advances testable propositions based on the technology overview and use of existing organizational buying behavior theory,This paper concludes that major changes are likely as a result of the adoption of IoT The nature of organizational communication may shift to more machine-to-machine communication and buying centers may become smaller, less hierarchical but more coordinated, with less conflict In addition, privacy and security concerns will need to be addressed,This is the first attempt to conceptualize the impact of adoption of IoT technologies that may help future researchers to examine the impact on a more granular level For practitioners, it may help them prepare for the impacts of the IoT technological juggernaut