Information Technology in Supplier Networks: A Theoretical Approach to Decisions about Information Technology and Supplier Relationships (Information Age Economy)

The present work by Sascha Weber addresses procurement which deals with business partners beyond the boundaries of one's organization. Procurement refers to the function of purchasing goods and services from suppliers, whether raw material used to manufacture an organization's final products, maintenance and repair supplies, or capital goods such as machinery and buildings. Major decisions in procurement concern the selection of the right suppliers with whom to establish a business relationship, the design of purchasing contracts, and the selection of information technology used to support the procurement process. In recent years the progress in information technology not only provided opportunities to rationalize the existing way of organizing procurement, but also opened up new ways of conducting business as the emergence of virtual enterprises and electronic markets may indicate. The objective of Sascha Weber's research is to analyze and answer the question of how the use of information technology and expected progress influences procurement decisions of an organization. The analysis is conducted identifying important parameters which describe the relevant properties of information technology and supplier relationships. Information technology is distinguished flrstly in terms of the task which is supported between information technology used to support the evaluation of potential suppliers and information technology for the support of the execution of a supplier relationship.

Under what conditions does the use of modern information technology in procurement relationships lead to more dynamics, e.g. in the form of using (electronic) marketplaces; under what conditions are long-term partnerships predominant? This book analyzes the impact of advances in information technology on procurement decisions in organizations. On the methodological basis of transaction cost theory and search theory a formal model is developed to represent decisions on supplier selection and the use of information technology. General statements are made in respect of the effect of progress in information technology on the expected duration of supplier contracts and the frequency of supplier changes.