Impact Of Strategic Purchasing on Organizational Performance in Manufacturing Firms Of Developing Country: Mediating Role Of Supply Management

Abstract

The purchasing function is becoming widely recognized as essential to strategic success, helping firms meet the challenges of an increasingly competitive and dynamic environment. The aim of this paper is to examine the impact of strategic purchasing on organizational performance and mediating the role of a limited number of suppliers and long-term orientation. Primary data was collected with the help of an adopted research instrument (questionnaire) with five Likert scale points. Manufacturing firms in Pakistan, a developing country, were targeted as the population of the study, and the sample size was 197 owners and employees. Confirmatory factor analysis and structural equation modeling (SEM) were applied in SmartPLS version 3. The present findings confirmed the impact of strategic purchasing on organizational performance, a limited number of suppliers, and long-term orientation. Our research suggests a direct effect of a limited number of suppliers and long-term orientation on organizational performance. Furthermore, we propose a partial mediation effect of these factors between strategic purchasing and organizational performance. These findings are not only valuable for the top management of firms and policy makers, but also have the potential to significantly influence future policies and strategies.