Decentralized Procurement in Light of Strategic Inventories

Anil Arya, Hans Frimor, Brian Mittendorf

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningpeer review

Resumé

The centralization versus decentralization choice is perhaps the quintessential organizational structure decision. In the operations realm, this choice is particularly critical when it comes to the procurement function. Why firms may opt to decentralize procurement has been often studied and confirmed to be a multifaceted choice. This paper complements existing studies by detailing the trade-offs in the centralization versus decentralization decision in light of firms' strategic use of inventories to influence supplier pricing. In particular, we demonstrate that a firm's decision to cede procurement choices to its individual divisions can help moderate inventory levels and provide a natural salve on supply chain frictions.

OriginalsprogEngelsk
TidsskriftManagement Science
Vol/bind61
Udgave nummer3
Sider (fra-til)578-585
ISSN0025-1909
DOI
StatusUdgivet - 1. mar. 2015
Udgivet eksterntJa

Fingeraftryk

Procurement
Centralization
Decentralization
Organizational structure
Suppliers
Trade-offs
Friction
Supply chain
Pricing

Citer dette

Arya, Anil ; Frimor, Hans ; Mittendorf, Brian. / Decentralized Procurement in Light of Strategic Inventories. I: Management Science. 2015 ; Bind 61, Nr. 3. s. 578-585.
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Decentralized Procurement in Light of Strategic Inventories. / Arya, Anil; Frimor, Hans; Mittendorf, Brian.

I: Management Science, Bind 61, Nr. 3, 01.03.2015, s. 578-585.

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningpeer review

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AU - Mittendorf, Brian

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KW - Supply chain coordination

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