Procurement Outsourcing
OUTSOURCING PROCUREMENT IN THE NIGERIAN INFRASTRUCTURE CONSTRUCTION INDUSTRY: A POTENTIAL FOR INCREASING PERFORMANCE
This research is not concerned about procurement in terms of project delivery, but procurement as a business function concerned with securing the inputs to the construction process. Some theories use different terms when describing the purchasing process and structure. However, it is assumed that the terms Supply Management, Purchasing and Procurement have similar meaning. Thus, the term procurement will in most parts of the research work, be interchanged with the term purchasing. While the former refers to a broader term (with respect to scope), both terms are fundamentally the same.
ABSTRACT
In 2006, Espino-Rodriguez & Padrón-Robaina, in their review of outsourcing from the Resource Based View (RBV), proposed a framework to outsourcing that relates the characteristics of a resource/business function to outsourcing and ultimately performance improvements. The application of RBV to outsourcing is a practically new field (Teece et al. 1997). For developments in this field, it is necessary to make this framework operational (Espino- Rodriguez and Padrón-Robaina 2006). Hence it is imperative to validate this framework to outsourcing decisions in specific economic sectors, geographical area and business function; and subsequently contribute to the development of complimentary functions that improves organisational performance.
Outsourcing business processes in Nigeria is relatively new and saddened with the lack of information (Anaekwe 2011). There is, however, increasing interest in outsourcing part or all of the procurement function, but there exists little knowledge on the drivers for an outsourcing decision (Maltz and Ellram 2006). The Infrastructure construction industry would greatly benefit from procurement outsourcing (P.O), because it is an industry characterised by high-supplier power. In addition to the rising cost of construction,
This research is not concerned about procurement in terms of project delivery, but procurement as a business function concerned with securing the inputs to the construction process. Some theories use different terms when describing the purchasing process and structure. However, it is assumed that the terms Supply Management, Purchasing and Procurement have similar meaning. Thus, the term procurement will in most parts of the research work, be interchanged with the term purchasing. While the former refers to a broader term (with respect to scope), both terms are fundamentally the same.
ABSTRACT
In 2006, Espino-Rodriguez & Padrón-Robaina, in their review of outsourcing from the Resource Based View (RBV), proposed a framework to outsourcing that relates the characteristics of a resource/business function to outsourcing and ultimately performance improvements. The application of RBV to outsourcing is a practically new field (Teece et al. 1997). For developments in this field, it is necessary to make this framework operational (Espino- Rodriguez and Padrón-Robaina 2006). Hence it is imperative to validate this framework to outsourcing decisions in specific economic sectors, geographical area and business function; and subsequently contribute to the development of complimentary functions that improves organisational performance.
Outsourcing business processes in Nigeria is relatively new and saddened with the lack of information (Anaekwe 2011). There is, however, increasing interest in outsourcing part or all of the procurement function, but there exists little knowledge on the drivers for an outsourcing decision (Maltz and Ellram 2006). The Infrastructure construction industry would greatly benefit from procurement outsourcing (P.O), because it is an industry characterised by high-supplier power. In addition to the rising cost of construction,
References: ELLEGAARD, C., et al., 2010. Purchasing and Supply Management in the Construction Industry. Guest Editorial. Journal of Purchasing & Supply Management 16 (2010) 219-220 LAWRENCE, T http://www.outsourcemagazine.co.uk/articles/item/4795 [Accessed 5 December 2012] SUPPLYCHAIN DIGEST, 2007 ARABE, K.C. 2003. The Rise of Procurement Outsourcing. [online]. NewYork: ThomanNet News. Available from: http://news.thomasnet.com/IMT/2003/10/20/the_rise_of_pro/ [Accessed 5 September 2012] PROSHARE. 2012. Concessioning in Nigeria: a Challenge to PPP. [online]. Lagos: Proshare. Available from: http://proshareng.com/news/16874, [Accessed 4 December 2012]