Organising the Purchasing Function as an Interface between Internal and External Networks

During recent years, increasing specialisation and complex market structures have made companies divide their purchasing functions into several organisational units to cope with increasingly diversified demands on linking the internal operations within the firm with operations at their suppliers. In this paper, we focus on organising of the purchasing function as an interface between internal and external counterparts. We suggest a framework focusing on how the purchasing function works as an interface between the firm’s suppliers and (other) firm internal functions, such as production, product development and marketing. The framework builds on two dimensions; one that describes how the purchasing function of a firm relates to other internal functions and one describing how it relates to suppliers. The purchasing situations described by the framework are illustrated with some examples. Also, the ways in which the organising principles can be aligned to purchasing strategies are discussed. We conclude with some possible avenues for further research to explore the insights the framework may generate.