Title: Contracts, relationships and integration: towards a model of the procurement of complex performance
Authors: Michael A. Lewis, Jens K. Roehrich
Addresses: Operations and Supply Management, University of Bath School of Management, Bath, BA2 7AY, UK. ' University of Bath School of Management, Bath, BA2 7AY, UK
Abstract: Although there is a growing body of research exploring the transition to a more service-based orientation in complex product markets, the majority of this literature adopts what might be classified as a |manufacturer-active| point of view that explores the challenges faced by firms (e.g., aircraft and capital equipment manufacturers, building firms, etc.) seeking to |sell| their reconceptualised streams of revenue. There has been much less research exploring the challenges associated with the transition from traditional asset acquisition processes to |buying| or Procuring Complex Performance (PCP) – defined as a combination of transactional and infrastructural complexity. This paper explores the macro- and microeconomic contexts to this specific problem space and develops a preliminary conceptualisation of the what, why and how of PCP. It draws on two principle literatures: one focused on the boundary conditions that firms consider when choosing to |make or buy| a range of different activities from the market (e.g., Fine and Whitney, 1999; Gilley and Rasheed, 2000; Williamson, 1985; Grover and Malhotra, 2003) and the other, on public procurement (e.g., Thai and Piga, 2006; Knight et al., 2007) and public-private partnerships, in particular (Broadbent and Laughlin, 2005; Froud, 2003). Three distinct governance challenges are presented: (1) contractual, (2) relational and (3) integration. The paper explores the implications of the conceptual model by developing a range of research propositions that are intended to be the foundations for future research.
Keywords: contracts; relationships; integration; complex performance; procurement; product-service systems; conceptual framework; complexity; complex product markets.
International Journal of Procurement Management, 2009 Vol.2 No.2, pp.125 - 142
Published online: 20 Feb 2009 *Full-text access for editors Access for subscribers Purchase this article Comment on this article