Purchasing models and organizational performance: a study of key strategic tools

Latin American countries show a lack of productivity and innovation compared with OECD economies. Business networks constitute a tool to improve this situation, and purchasing can help organizations create business networks with suppliers, as purchasing has evolved from a support function to a key strategic tool for organizations. Purchasing maturity models reflect this evolution. As their level of purchasing maturity increases, organizations experience increased performance. Unfortunately, however, current models do not specify the purchasing tools and methodologies that firms should use to enhance their purchasing maturity level and thus increase their cost savings. This study advances the literature by identifying 16 tools, methodologies, and strategic and nonstrategic activities, as well as 10 cost-saving levers linked to the stages of purchasing maturity. Based on a study of 278 Chilean companies, this paper identifies which key activities, tools, and methodologies that organizations can use to improve their purchasing performance.