E-Procurement Infusion and Operational Process Impacts in MRO Procurement: Complementary or Substitutive Effects?

The procurement of maintenance, repair, and operating (MRO) goods has remained a relatively understudied topic in the literature. Though vital cost efficiencies can be extracted from procurement processes through investments in e-procurement systems, there is little empirical work that addresses how such systems should be deployed within organizations. In this study, we focus on the role of e-procurement systems in MRO procurement and study two critical aspects of infusion. The first dimension captures the depth of e-procurement use within the procurement function, while the second dimension depicts the breadth of use. We argue that these two dimensions of e-procurement use, and their interaction, will be related to the performance of the MRO procurement process. Using survey data from 193 service organizations and structural equation modeling techniques, we show that the two infusion dimensions are significantly associated with improved process performance. Additionally, we show a substantial substitutive effect between the two use dimensions on performance. Our work has significant implications for managers who seek to gain efficiencies by the deployment of Internet-based technologies within operational processes. Our conceptualization of e-procurement infusion along two dimensions provides a more fine-grained analysis of performance benefits accruing from the infusion of information technologies within organizations.