IDEAS home Printed from https://ideas.repec.org/a/ids/ijpman/v5y2012i2p123-139.html
   My bibliography  Save this article

The transaction management perspective on procurement in the era of globalisation

Author

Listed:
  • Frank A.G. Den Butter

Abstract

Fragmentation of production into more and more complex supply chains is a prominent feature of globalisation. Transaction management purports to minimise the transaction costs associated with this fragmentation of production. In this era of globalisation, transaction costs carry a large weight in total costs of ownership which is the relevant cost function in procurement decisions. This article discusses how transaction management can be helpful to these procurement decisions. An analysis of the various types of transaction costs is essential in the 'make or buy' and location decisions in global sourcing. In general, a distinction can be made between 'hard' and 'soft' transaction costs when making strategic procurement decisions. Soft transaction costs are difficult to quantify but become more important now that formal trade barriers gradually disappear and transport costs are reduced. Business strategies to keep transaction costs low in the long run can also, to a considerable extent, explain socially responsible business conduct from the perspective of rational economic behaviour.

Suggested Citation

  • Frank A.G. Den Butter, 2012. "The transaction management perspective on procurement in the era of globalisation," International Journal of Procurement Management, Inderscience Enterprises Ltd, vol. 5(2), pages 123-139.
    • Handle: RePEc:ids:ijpman:v:5:y:2012:i:2:p:123-139
    as

    Download full text from publisher

    File URL: http://www.inderscience.com/link.php?id=45646
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ebel Berghuis & Frank A. G. den Butter, 2017. "The transaction costs perspective on international supply chain management; evidence from case studies in the manufacturing industry in the Netherlands," International Review of Applied Economics, Taylor & Francis Journals, vol. 31(6), pages 754-773, November.
    2. Godfrey Mugurusi & Luitzen de Boer, 2019. "Are You Receiving Me? A Viable System Model (VSM) Analysis of Purchasing Coordination in a Firm Engaged in Offshoring of Manufacturing Activities," Systemic Practice and Action Research, Springer, vol. 32(3), pages 239-272, June.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ids:ijpman:v:5:y:2012:i:2:p:123-139. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sarah Parker (email available below). General contact details of provider: http://www.inderscience.com/browse/index.php?journalID=255 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.