Drivers and differentiators: a grounded theory study of procurement in public and private organizations

Purpose - The purpose of this study is to examine procurement professionals’ perceptions of public-private partnerships in contract arrangements and to explore decision-making that takes place in the contracting process. Design/methodology/approach - A grounded theory approach is applied to Simon’s (1947) model of decision-making to better understand the perceptions of procurement professionals, especially because it pertains to public vs private sector contexts. The researchers collected data by conducting interviews and observing a compliance webinar of federal contracting employees. Findings - The results show that in the decision-making process, Simon’s illustration of a means-end hierarchy is applicable for procurement decision-making because it is driven by activities that are evaluated using aims established by the organization. Practical implications - The implications are that, in the procurement decision-making process, a means-end hierarchy is driven by the activities that are evaluated using aims established by the organization. Essentially, the activities are associated to a mean, a mean is associated to a sub-goal and the sub-goal supports the main aim of the organization. Social implications - This study supports the notion that training, information and procedures are a way for organizations to control behaviors and promote consistent results from their subordinates. Originality/value - This study contributes by examining the drivers of procurement decision-making. Despite previous literature that focuses on practitioner discretion or emphasizes on socio-economic factors, this study highlights the linkages between practitioner decision-making and organizational aims and objectives. As such, the paper serves to illustrate the vital connection between procurement activities and outputs.