Evolving Procurement Organizations: External and Internal Fit Considerations

Procurement has to find further levers and advance its contribution to corporate goals continuously. This places pressure on its organization in order to facilitate its performance. Therefore, Procurement organizations constantly have to evolve in order to match these demands. A conceptual model is presented and results of a first case study discussed. The findings highlight the importance of taking a contingency perspective on Procurement organization, understanding the internal and internal contingency factors. From a theoretical perspective, it opens up insights that can be furthermore leveraged in future studies in the fields of hybrid procurement organizations, global sourcing organizations as well as international procurement offices (IPOs). From a practical standpoint, an assessment of external and internal contingencies provides the opportunity to consciously match organization to its operating environment and internal demands, and also reassess this “fit” from time to time in order to deliberately detect need for change.