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Public capacity complements urban density because externalities abound in cities and urban scale makes it possible to share infrastructure that needs to be managed. Yet, urban governments face limitations that are not experienced by private sector entities. A city cannot just stop policing if it decides it is bad at policing. Typically, public compensation and personnel policies are highly regulated either by law or by union contracts. City governments do, however, have one great advantage over private entities: a greater ability to learn from their peers. City governments do similar things throughout the world, while companies frequently specialize. Private companies have strong incentives to hide the trade secrets that make them more productive, cities do not. As individual cities do not have an incentive to make it easier for other governments to learn from them, multinational entities like the Asian Development Bank and the World Bank could enable that learning. Since climate-change-related crises are relatively rare events, city-to-city learning seems particularly important for adapting to climate change.

With the rapid expansion of global business, newer suppliers with cheaper but possibly unreliable technologies have entered the marketplace to win orders from buyer firms by beating the price of their perfectly reliable (but expensive) competitors. We model the procurement problem as a Nash game where the buyer has to allocate its purchases between an expensive but reliable supplier, and a cheaper but unreliable supplier. The suppliers specify prices for different proportions of the order awarded to them. Our analysis shows that, when perfect information is available about the reliability level of the unreliable supplier, the Nash equilibrium is a sole-sourcing allocation and that the supplier selection decision depends on the reliability and cost differentials between the two suppliers. In addition, we model the case when the buyer and the reliable supplier have limited information about the reliability of the unreliable supplier. Even in such an asymmetric scenario, the buyer's equilibrium allocation is a sole-sourcing outcome, but depending on system conditions either a separating or a pooling equilibrium is possible. An interesting insight into the effect of information asymmetry is that it can result in higher or lower profits/costs for the channel partners (compared to the perfect information case). As such, the buyer may even benefit from information asymmetry regarding unreliable supplier due to its impact on the degree of competition between the two suppliers.

Multi-attribute reverse auction has many advantages for the buyer with the multi-dimensional attribute requirements. However, it is hard to design an optimal auction mechanism for the scenario in practice. Therefore, this paper presents a method transforming multi-attribute auction into single-attribute auction by bidding in deposit. The analysis indicates that our method can reduce not only the transaction risk caused by the supplier’s bid abandonment but also the operating cost and complexity of the multi-attribute auction. Besides, our method meets the incentive compatibility and participation constraint conditions by promising that the highest bidding supplier is the winner in the Auction and can obtain higher expected profits than traditional auctions for the buyer.

Software solutions to automate the procurement of web services are gaining importance when technology evolves, the number of providers increases and the needs of the clients become more complex. There are several proposals in this field, but they all have important drawbacks, namely: many of them are not able to check offers and demands for internal consistency; selecting the best offer usually relies on evaluating linear objective functions, which is quite a naive solution; the language to express offers is usually less expressive than the language to express demands; and, last but not least, providers cannot impose constraints on their clients. In this article, we present a solution to overcome these problems that relies on constraint programming; furthermore, we present a run-time framework, some experimental results, and a comparison with other proposals.

ABSolute is a general-purpose, multi-dimensional decision support system which has a highly sophisticated visualization-based user interface for direct data manipulation. The interface and analysis facilities of this system enable the users to effectively view, explore, search, compare and classify data items to make discoveries, decisions or explanations about patterns, groups of items, or individual items with the highest level of confidence and knowledge. The usefulness of this system is demonstrated in solving a complex decision-making problem in a business environment: a bid evaluation and selection problem in corporate procurement using a RFQ (Request-For-Quotes) process.

Wrong decisions or inappropriate selection of equipment may lead to increase in cost and reduction in efficiency and effectiveness. Selecting right equipment has always been a key factor in the success of the process it is used for. In this study, superiority and inferiority ranking (SIR) methodis utilized for evaluation of most suitable offer for procurement of equipment installed inside a facility, whereas, analytical hierarchy process (AHP) is used to calculate the weights of factors that influence procurement decision. To achieve this target, a methodological framework of a series of interviews are conducted, then two questionnaire surveys are developed for identifying the important factors affecting the selection process of equipment and determining their relative importance. A solution of the problem is then designed in a model using AHP and SIR methods in addition to using the simple additive weighting (SAW) and technique for order preference by similarity to the ideal solution (TOPSIS) procedures to generate the superiority and inferiority flows. The model is generic and flexible and is used for the application of the multiple criteria decision making (MCDM) methods in the procurement process. The model also offers an efficient and convenient tool that aids its users to act in an orderly and methodical thinking, and guides them in making logical and robust decisions. A case study is presented to demonstrate the use of the developed model and sensitivity analysis is carried out to measure the robustness of the model in different scenarios.

This paper reports on a study of a methodology to procure semiconductor components for subassemblies used in mainframe computers assembled in IBM. The demand for the subassemblies is highly uncertain as a result of the uncertain mainframe model demands. The demands for mainframe models are dependent on each other. There is also dependency among demands in several time periods. The component personalization process is several weeks long and hence orders for components have to be placed in advance. There is a lot of commonality of components in subassemblies and subassemblies in mainframe models. A software tool to perform procurement planning as well as some what-if analyses has been developed. Results are reported on the use of this tool to generate component requirements by considering set requirements for components, component commonality and dependency of product demands. The results, when compared with the traditional materials requirements planning (MRP) method, suggest that equal or higher service levels can be achieved for a given inventory budget; conversely, a specified service level can be achieved with equal or lower component procurement.

This article investigates the largest American black-owned companies over a 30-year period, from 1974 to 2004. Trends with regard to the growth and decline of industry categories and of individual companies, and with regard to these companies' survival rates, are analyzed. Comparable survival rates of small businesses in general, of minority businesses, and of large corporations are investigated. The important factors of corporate minority procurement programs and government minority set-aside programs are evaluated. The phenomenon of large American corporations acquiring some of the most successful black-owned businesses is also studied. These various factors relating to black business success and failure lead to a range of implications and recommendations for current and aspiring minority business owners, as well as to consultants to and researchers of minority business.

The development and installation of new process equipment in production plants typically require strong collaborative efforts by a process firm and its equipment suppliers. However, existing knowledge about how such supplier integration and open innovation practices should be organized and managed is scarce. The purpose of this investigation is therefore to explore how process firms can organize and manage supplier integration and open innovation practices when developing and installing new process technology. By means of a literature review and a case study of two process firms, a lifecycle perspective on procurement is adopted. Our results show that the process firms utilize different interconnected cooperative procurement procedures in different stages of the equipment's lifecycle, in order to enhance integration both in buyer-supplier dyads and among the suppliers in the project network. The contributions of the paper are summarized and illustrated in a developed lifecycle-based procurement model that guides practitioners in organizing and managing supplier integration and open innovation practices.

Open innovation and the use of suppliers and start-ups as external idea sources have become increasingly important in the automotive industry. Since the purchasing function in a company has correspondingly become more strategic, scholars have taken the role of procurement in innovation more intensely into account. This study examines procurement’s role in the innovation process of the automotive industry and investigates which and how open innovation instruments are used in order to benefit from the innovation capability of suppliers and start-ups. The empirical evidence is based on an in-depth case study of the automotive manufacturer AUDI AG. Several arguments are elaborated which justify a key role for procurement in the innovation process (e.g., interface role, economic activities). Furthermore, we identified nine pull and push instruments enabling procurement to contribute to Audi’s innovation performance. Since the instruments are designed to meet different internal requirements (e.g., in relation to a vehicle project or not), interesting insights for scholars and practitioners are provided.

In new product development (NPD) firms increasingly have to rely on external expertise from suppliers. However, results of early supplier integration have been found to be ambiguous. This research empirically tests the hypothesis that the participation of professional purchasing agents early on in the supplier integration process plays a decisive role to distinguish successful projects. Our sample gave evidence that early supply management integration positively moderated supplier involvement’s effect on firm success. Hence, firms may benefit from avoiding supplier integration without professional purchasing management. Still, in many firms the procurement department is not yet integrated in NPD processes early on. Our research identifies four measures those firms applied, in which purchasing got fully embedded in the innovation process: top-management support, structural differentiation, explicit processes, and a collaborative corporate culture. This finding can serve as blue print for implementing purchasing integration and therewith improve the success of supplier integration in NPD.

Procurement includes a planning, acquisition, and contract management phase. Project procurement management, which embraces these three phases, is one of the 10 knowledge areas identified in the PMBOK@ Guide (2016) and one of the 17 practices described in ISO 21502. These standards provide generic guidance on concepts, processes, and practices applicable to all types of projects that may be located within any industry and do not provide industry-specific adaptations. This chapter identifies the specificities of the construction industry and articulates the differentiators in practices between the construction industry and what is catered for in the generic body of knowledge for project procurement management. It identifies the need for and nature of a construction-specific body of knowledge for project procurement management and indicates the knowledge, skills, and attitudes required of practitioners in this field. The procurement challenges and needs faced in developing countries are identified. The underlying environment within which construction works projects are delivered and the resources available to deliver projects are the major differentiators between developed and developing countries. Strategic and tactical choices and the manner and extent of their application will differ. The level of maturity in performing the client “buying” function can also differ. More research is required to establish the client “buying” function body of knowledge. Research is also required to broaden the understanding of the linkage between client maturity in the “client” buying function and project outcomes. Evidence-based research is also required to inform strategic and tactical decisions.

The concept of using indicators to assess performance originates from the practice of benchmarking used in many industries for improving business processes and products. What makes the concept of project success difficult and complicated in practice is that there is no consensus on how it should be measured, and the unlikelihood of reaching a consensus further complicates the management of projects. Scholars view the multiple ways of measuring success as being dependent on the interest and business goals of each project stakeholder. In developing countries, construction project environments are dynamic due to the involvement of multiple stakeholders, including communities with different interpretations of project performance indicators, who also prioritize them differently. Therefore, this chapter examines project performance indicators in the context of developing countries with the view to establish the important indicators common to project stakeholders and where there are usually conspicuous differences. The study uses a systematic literature review to gather the necessary information to answer the chapter’s objectives. The outputs of the review include a conceptual model of project performance indicators common to developing countries. Furthermore, the chapter argues that project organizations play a crucial role in defining the terms of reference and accountabilities for all key roles in project delivery. Implications of this conceptual model for theory and practice are discussed. The establishment of these performance indicators will contribute to the improvement of project management in developing countries.