The role of the purchasing function in non-financial value creation

Abstract

Costs and transactions have been highlighted in the earlier research and practice around purchasing and supply management (PSM). This study investigates in-depth the role of the PSM function in creating non-financial value for the buying company and its customers. Interview study was used to examine four large organizations both in service and manufacturing industries. The findings indicate that relationship value gives a strong potential for developing successful buyer-seller relationships. Service support and personal interaction arise as important differentiators in building the relationships. Key differences across the different contexts existent in this study are also provided.