INVESTIGATING COOPERATIVE PURCHASING PERFORMANCE - A SURVEY OF PURCHASING PROFESSIONALS IN DUTCH HOSPITALS

Authors

  • Cees Johannes Gelderman Open University of the Netherlands
  • Jelle De Jonge Nij Smellinghe hospital
  • Jos Schijns Open University of the Netherlands
  • Janjaap Semeijn Open University of the Netherlands

DOI:

https://doi.org/10.29015/cerem.568

Keywords:

cooperative purchasing, healthcare, trust, commitment, cooperative purchasing performance

Abstract

Aim: Cooperative purchasing is considered a promising area for lowering the cost in the health care sector, although recent initiatives show mixed results. The purpose of this study is to find a thorough explanation for the performance of cooperative purchasing in healthcare by investigating the role of trust, commitment, organizational factors (i.e. group formality, and IT system effectiveness) and interpersonal skills (i.e. teamwork skills, and communication).

Design/research method: A conceptual model for the performance of cooperative purchasing was developed. This model was empirically validated using a survey of 88 Dutch hospital purchasing professionals.

Conclusions/findings: Analysis shows a significant impact of trust and commitment in cooperative purchasing groups on performance. Group formality and teamwork skills appear to be essential for achieving trust and cooperative purchasing performance. We also found a positive impact of IT system effectiveness on commitment, not on trust. Positive feelings about the group and positive expectation about the continuity of the group can be stimulated through effective IT systems. Since proper IT support is often neglected in many healthcare organizations, management efforts to improve IT systems could truly facilitate the tactical purchasing process of cooperative purchasing in hospitals.

Originality/value of the article: Many cooperative purchasing initiatives suffer from conflicts over the allocation of savings, time, and costs. Despite the growing importance of cooperative purchasing, few empirical studies have explored the effects on hospital performance. Our study extends previous research by investigating the relationships between trust, commitment, and the performance of cooperative purchasing (1) and the impact of organizational factors and interpersonal skills on trust and commitment in purchasing groups within a healthcare context (2).

Author Biographies

Cees Johannes Gelderman, Open University of the Netherlands

Faculty of Management, Science & Technology

Department of Marketing & Supply Chain Management

Associate professor of purchasing and marketing management

Jelle De Jonge, Nij Smellinghe hospital

Head of Purchasing and Logistics

Jos Schijns, Open University of the Netherlands

Faculty of Management, Science & Technology

Department of Marketing & Supply Chain Management

Assistant professor of marketing

Janjaap Semeijn, Open University of the Netherlands

Faculty of Management, Science & Technology

Department of Marketing & Supply Chain Management

Associate professor of purchasing and marketing management

References

Anderson J.C., Narus A. (1990), A model of distributor firm and manufacturer firm working partnerships, “Journal of Marketing”, vol. 54, no. 1, pp. 42-58.

Al-Amin M., Makarem S.C., Rosko M (2016), Efficiency and hospital effectiveness in improving Hospital Consumer Assessment of Healthcare Providers and Systems ratings, “Health Care Management Review”, vol. 41, no 4, pp. 296-305.

Bagozzi R.P. (1994), Principles of Marketing Research, Cambridge, MA: Blackwell.

Birken S.A., Lee S.Y.D., Weiner B.J., Chin M.H, Chiu M., Schaefer C.T. (2015), From strategy to action: how top managers’ support increases middle managers’ commitment to innovation implementation in health care organization, “Health Care Management Review”, vol. 40, no. 2, pp. 159-168.

Büchner V.A., Hinz V., Schreyögg, J. (2015), Cooperation for a competitive position: the impact of hospital cooperation behavior on organizational performance, “Health Care Management Review”, vol. 40, no. 3, pp. 214-224.

Burn L.R., Lee J.A. (2008), Hospital purchasing alliances: utilization, services, and performance, “Health Care Management Review”, vol. 33, no. 3, pp. 203-215.

Carrera P.M., Katik, S., Schotanus F. (2015), Cooperative purchasing of pacemakers by Dutch hospitals: what are the determinants, cost-savings and perceived non-monetary benefits?, “Proceedings of the 24th IPSERA Conference”, Amsterdam, the Netherlands.

Chakraborty S., Bhattacharya S., Dobrzykowski D.D. (2014), Impact of supply chain collaboration on value co-creation and firm performance: a healthcare service sector perspective, “Procedia Economics and Finance”, vol. 11, pp. 676-694.

Chen D.Q., Preston D.S., Xia W. (2013), Enhancing hospital supply chain performance: a relational view and empirical test, “Journal of Operations Management”, vol. 31, no. 6, pp. 391-408.

Collum T.H., Menachemi N., Sen B. (2016), Does electronic health record use improve hospital financial performance? Evidence from panel data, “Health Care Management Review”, vol. 41, no. 3, pp. 267-274.

Davis F. D. (1989), Perceived usefulness, perceived ease of use, and user acceptance of information technology, “MIS quarterly”, vol. 13, no. 3, pp. 319-340.

De Vries G., Bertrand J.W.M., Vissers J.M.H. (1999), Design requirements for health care production and control systems, “Production Planning and Control: The Management of Operations”, vol. 10, no. 6, pp. 559-569.

Doney P. M., Cannon J.P. (1997), An examination of the nature of trust in buyer-seller relationships, “Journal of Marketing”, vol. 61, no. 2, pp. 35-51.

Driedonks B.A. (2011), Sourcing team success: team studies in a purchasing and supply management context, dissertation, Eindhoven University of Technology, the Netherlands.

Driedonks B.A., Gevers J.M., Van Weele A.J. (2014), Success factors for sourcing teams: How to foster sourcing team effectiveness, “European Management Journal”, vol. 32, no. 2, pp. 288-304.

Dyer J. H. (1997), Effective interim collaboration: how firms minimize transaction costs and maximize transaction value, “Strategic Management Journal”, vol. 18, no. 7, pp. 535-556.

Elmuti D., Khoury G., Omran O., Aboud-Zaid A.S. (2013), Challenges and opportunities of health care supply chain management in the United States, “Health Marketing Quarterly”, vol. 30, no. 2, pp. 128-143.

Essig M. (2000), Purchasing consortia as symbiotic relationships: developing the concept of “consortium sourcing”, “European Journal of Purchasing and Supply Management”, vol. 6, no. 1, pp. 13-22.

Eriksson P.E., Westerberg M. (2010), Effects of cooperative procurement procedures in construction project performance: a conceptual framework, “International Journal of Project Management”, vol. 29, no. 2, pp. 197-208.

Ford E.E., Scanlon D.P. (2007), Promise and problems with supply management approaches to health care purchasing, “Health Care Management Review”, vol. 32, no. 3, pp. 192-202.

Fornell C., Larcker D. F. (1981), Evaluating structural equation models with unobservable variables and measurement error, “Journal of Marketing Research”, vol. 18, no. 1, pp. 39-50.

Gelderman C.J., Albronda B.J. (2017), Professioneel inkopen (Professional purchasing), 5th edition, Noordhoff Uitgevers, Groningen, The Netherlands.

Giunipero L.C., Pearcy D.H. (2000), World-class purchasing skills: an empirical investigation, “Journal of Supply Chain Management”, vol. 36, no. 4, pp. 4-15.

Gobbi C., Hsuan J. (2015), Collaborative purchasing of complex technologies in healthcare – implications for alignment strategies, “International Journal of Operations and Production Management”, vol. 35, no. 3, pp. 430-455.

Hair J.F., Hult G.T.M., Ringle C.M., Sarstedt, M. (2014), A primer on partial least squares structural equation modeling (PLS-SEM), Thousand Oaks: SAGE.

Hendrick T.E. (1996), Purchasing consortiums: Horizontal alliances among firms buying common goods and services: What? who? why? how?, Center for Advanced Purchasing Studies.

Hoffmann W. H., Schlosser R. (2001), Success factors of strategic alliances in small and medium- sized enterprises - An empirical survey, “Long range planning”, vol. 34, no. 3, pp. 357-381.

Klein Woolthuis R. (1999), Sleeping with the enemy: trust, dependence and contract in interorganisational relationships, dissertation, University of Twente, the Netherlands.

Kumar N., Scheer L.K., Steenkamp J.B.E. (1995), The effects of perceived interdependence on dealer attitudes, “Journal of Marketing Research”, vol. 32, no. 3, pp. 348-356.

Kusters R.J.G., Versendaal J. (2013), Horizontal collaborative e-purchasing for hospitals: IT for addressing collaborative purchasing impediments, “Journal of International Technology and Information Management”, vol. 22, no. 1, pp. 64-83.

Kwon I.W.G., Suh T. (2004), Factors affecting the level of trust and commitment in supply chain relationships, “Journal of Supply Chain Management”, vol. 40, no. 1, pp. 4-14.

Liang A., Cotton, S. (1997), Patterns of inter-organizational purchasing: Evolution of consortia- based purchasing amongst GP fund holders, “European Journal of Purchasing and Supply Management”, vol. 3, no. 2, pp. 83-91.

Maas C.J., Hox J.J. (2005), Sufficient sample sizes for multilevel modeling, “Methodology”, vol. 1, no. 3, pp. 86-92.

Macinati M.S., Rizzo M.G. (2016), Exploring the link between clinical managers involvement in budgeting and performance: insights from the Italian public health care sector, “Health Care Management Review”, vol. 41, no. 3, pp. 213-223.

Lowry P.B., Gaskin J. (2014), Partial Least Squares (PLS) Structural Equation Modeling (SEM) for building and testing behavioral causal theory: when to choose it and how to use it, “IEEE Transactions on Professional Communication”, vol. 57, no. 2, pp. 123-146.

Meijer, J. (2014), Effective purchasing collaboration with autonomy and confederation structures (in Dutch: Effectieve inkoopsamenwerking met autonomie- en confederatiestructuren), Nyenrode Business University, Breukelen, the Netherlands.

Morgan R.M., Hunt S.D. (1994), The commitment-trust theory of relationship marketing, “Journal of Marketing”, vol. 58, no. 3, pp. 20-38.

Muhwezi M. (2010), Horizontal purchasing collaboration in developing countries – Behavioral issues in public units in Uganda, dissertation, University of Twente, Enschede, the Netherlands.

Nollet J., Beaulieu M. 2003, The development of group purchasing: an empirical study in the healthcare sector, “Journal of Purchasing and Supply Management”, vol. 9, no. 1, pp. 3-10.

Nollet J., Beaulieu M. (2005), Should an organisation join a purchasing group? “Supply Chain Management: An International Journal”, vol. 10, no. 1, pp. 11-17.

Paulraj A., Lado A.A., Chen I.J. (2008), Inter-organizational communication as a relational competency: antecedents and performance outcomes in collaborative buyer–supplier relationships, “Journal of Operations Management”, vol. 26, no. 1, pp. 45-64.

Prajago D., Sohal A. (2013), Supply chain professionals – a study of competences, use of technologies, and future challenges, “International Journal of Operations and Production Management”, vol. 33, no. 11-12, pp. 1532-1554.

Rego N., Claro J., Pinho de Sousa, J. (2014), A hybrid approach for integrated healthcare cooperative purchasing and supply chain configuration, “Health Care Management Science”, vol. 17, no. 4, pp. 303-320.

Ringle C.M., Wende, S., Becker, J.-M. (2015,. SmartPLS 3. Bönningstedt: SmartPLS, retrieved from http://www.smartpls.com

Rozemeijer F.A. (2000), Creating corporate advantage in purchasing, dissertation, Eindhoven University of Technology, the Netherlands.

Ruiter H., Buijs S., Bakker E., Van den Bemd L. (2011), Purchasing in healthcare in 2011, best practices (in Dutch: Inkoop in de zorg anno 2011, best practices), Berenschot/NEVI, Utrecht, the Netherlands.

Schneller E.S. (2000), The value of group purchasing in the health care supply chain, School of Health Administration and Policy, Arizona State University College of Business, Tempe.

Schneller E. S. (2009), The value of group purchasing-2009: meeting the needs for strategic savings, a study conducted by Health Care Sector Advances Inc.

Schotanus F., Telgen J. (2007), Developing a typology of organizational forms of cooperative purchasing, “Journal of Purchasing and Supply Management”, vol. 13, no. 1, pp. 53-68.

Schotanus F., Telgen J., De Boer L.D. (2010), Critical success factors for managing purchasing groups, “Journal of Purchasing and Supply Management”, vol. 16, no. 1, pp. 51-60.

Schut F.T., Van den Berg B. (2010), Sustainability of comprehensive universal long-term care insurance in the Netherlands, “Social Policy & Administration”, vol. 44, no. 4, pp. 411-435.

Spaulding A., Zhao M., Haley D.R. (2014), Value-based purchasing and hospital acquired conditions: are we seeing improvement? “Health Policy”, vol. 118, no. 3, pp. 413-421.

Stevens M.J., Campion M.A. (1994), The knowledge, skill, and ability requirements for teamwork: implications for human resource management, “Journal of Management”, vol. 20, no. 2, pp. 503–530.

Tasa K., Taggar S., Seijts G.H. (2007), The development of collective efficacy in teams: a multilevel and longitudinal perspective, “Journal of Applied Psychology”, vol. 92, no. 1, pp. 17-27.

Tátra T. (2015), Joint public procurement, “ERA Forum”, vol. 16, pp. 7-24.

Tella E., Virolainen V.M. (2005), Motives behind purchasing consortia, “International Journal of Production Economics”, vol. 93-94, pp. 161-168.

Van Ewijk, C., Van der Horst, A.& Besseling, P. (2013). Health pays off: between choice and solidarity, a future for healthcare (In Dutch: Gezondheid loont: tussen keuze en solidariteit, toekomst voor de zorg), CPB, The Hague, the Netherlands.

Walker H., Schotanus F., Bakker E., Harland, C. (2013), Collaborative procurement: a relational view of buyer–buyer relationships, “Public Administration Review”, vol. 73, no. 4, pp. 588-598.

Williamson O.E. (1979), Transaction-cost economics: the governance of contractual relations, “Journal of Law and Economics”, vol. 22, no. 2, pp. 233-261.

Zaheer A., McEvily B., Perrone V. (1998), Does trust matter? Exploring the effects of interorganizational and interpersonal trust on performance, “Organization Science”, vol. 9, no. 2, pp. 141-159.

Downloads

Published

2018-03-15