How procurement managers view low cost countries and geographies

A perceptual mapping approach

Joseph R. Carter, Arnold Maltz, Tingting Yan, Elliot Maltz

Research output: Contribution to journalArticle

40 Citations (Scopus)

Abstract

Purpose - There is good evidence that the shift in global sourcing is toward so-called "low cost country suppliers." Yet conditions in these countries are often not well-known. At the same time, best practices in integrated supply dictate a multi-faceted decision, rather than basing supplier location on a single attribute say, labor cost alone. With these issues in mind, a research project was formulated with two primary objectives. First, the authors wanted to compile the knowledge and perceptions of purchasing managers regarding low cost regions and their capabilities and to reflect the multiple factors involved in current sourcing strategies and supplier selection decisions in these low cost geographies. Second, the authors wanted to compare managers' subjective perceptions with objective data regarding attributes of sourcing locations to identify the relationship between perceptions and reality. This paper aims to explore the issues. Design/methodology/approach - The authors surveyed over 100 sourcing professionals on their perceptions of various low cost sourcing alternatives. Perceptual mapping techniques were used to combine the rankings on some 12 different attributes to visualize how the various attributes relate to each other and how the low cost regions compare when rated against sourcing managers' ideal perceptions. Findings - The research results show that procurement managers select regions for low cost sourcing based on both specific measures and individual and/or group perceptions of the region, whether these perceptions are correct or not. This paper probes these perceptions. Also the paper compares these subjective perceptions with objective data to show that cultural stereotypes may bias managers' perception of location-specific characteristics. The paper closes with implications for procurement managers and opportunities for further research. Practical implications - The authors have demonstrated that purchasing managers choose sourcing locations using multiple criteria instead of only focusing on cost. But some perceptions are biased by cultural stereotypes and do not reflect reality. This suggests that managers have to be careful when using their subjective judgment in choosing sourcing locations. Originality/value - The authors believe that visual representations of alternative sourcing options have great potential to improve the efficiency of cross-disciplinary and multi-company teams that are increasingly responsible for global sourcing strategies. Comparing managers' perception with objective data of location attributes shows that mangers' perception may be biased by cultural stereotypes.

Original languageEnglish (US)
Pages (from-to)224-243
Number of pages20
JournalInternational Journal of Physical Distribution and Logistics Management
Volume38
Issue number3
DOIs
StatePublished - 2008

Fingerprint

Managers
manager
geography
costs
Costs
Purchasing
supplier
stereotype
Geography
Procurement
Perceptual mapping
Sourcing
group perception
labor costs
research results
Personnel
best practice
ranking
research project
supply

Keywords

  • International business
  • Sourcing
  • Supplier evaluation

ASJC Scopus subject areas

  • Business, Management and Accounting(all)
  • Management Information Systems

Cite this

How procurement managers view low cost countries and geographies : A perceptual mapping approach. / Carter, Joseph R.; Maltz, Arnold; Yan, Tingting; Maltz, Elliot.

In: International Journal of Physical Distribution and Logistics Management, Vol. 38, No. 3, 2008, p. 224-243.

Research output: Contribution to journalArticle

Carter, Joseph R. ; Maltz, Arnold ; Yan, Tingting ; Maltz, Elliot. / How procurement managers view low cost countries and geographies : A perceptual mapping approach. In: International Journal of Physical Distribution and Logistics Management. 2008 ; Vol. 38, No. 3. pp. 224-243.
@article{da3f893a61b84e88aa74bab0176eae7c,
title = "How procurement managers view low cost countries and geographies: A perceptual mapping approach",
abstract = "Purpose - There is good evidence that the shift in global sourcing is toward so-called {"}low cost country suppliers.{"} Yet conditions in these countries are often not well-known. At the same time, best practices in integrated supply dictate a multi-faceted decision, rather than basing supplier location on a single attribute say, labor cost alone. With these issues in mind, a research project was formulated with two primary objectives. First, the authors wanted to compile the knowledge and perceptions of purchasing managers regarding low cost regions and their capabilities and to reflect the multiple factors involved in current sourcing strategies and supplier selection decisions in these low cost geographies. Second, the authors wanted to compare managers' subjective perceptions with objective data regarding attributes of sourcing locations to identify the relationship between perceptions and reality. This paper aims to explore the issues. Design/methodology/approach - The authors surveyed over 100 sourcing professionals on their perceptions of various low cost sourcing alternatives. Perceptual mapping techniques were used to combine the rankings on some 12 different attributes to visualize how the various attributes relate to each other and how the low cost regions compare when rated against sourcing managers' ideal perceptions. Findings - The research results show that procurement managers select regions for low cost sourcing based on both specific measures and individual and/or group perceptions of the region, whether these perceptions are correct or not. This paper probes these perceptions. Also the paper compares these subjective perceptions with objective data to show that cultural stereotypes may bias managers' perception of location-specific characteristics. The paper closes with implications for procurement managers and opportunities for further research. Practical implications - The authors have demonstrated that purchasing managers choose sourcing locations using multiple criteria instead of only focusing on cost. But some perceptions are biased by cultural stereotypes and do not reflect reality. This suggests that managers have to be careful when using their subjective judgment in choosing sourcing locations. Originality/value - The authors believe that visual representations of alternative sourcing options have great potential to improve the efficiency of cross-disciplinary and multi-company teams that are increasingly responsible for global sourcing strategies. Comparing managers' perception with objective data of location attributes shows that mangers' perception may be biased by cultural stereotypes.",
keywords = "International business, Sourcing, Supplier evaluation",
author = "Carter, {Joseph R.} and Arnold Maltz and Tingting Yan and Elliot Maltz",
year = "2008",
doi = "10.1108/09600030810866995",
language = "English (US)",
volume = "38",
pages = "224--243",
journal = "International Journal of Physical Distribution and Logistics Management",
issn = "0960-0035",
publisher = "Emerald Group Publishing Ltd.",
number = "3",

}

TY - JOUR

T1 - How procurement managers view low cost countries and geographies

T2 - A perceptual mapping approach

AU - Carter, Joseph R.

AU - Maltz, Arnold

AU - Yan, Tingting

AU - Maltz, Elliot

PY - 2008

Y1 - 2008

N2 - Purpose - There is good evidence that the shift in global sourcing is toward so-called "low cost country suppliers." Yet conditions in these countries are often not well-known. At the same time, best practices in integrated supply dictate a multi-faceted decision, rather than basing supplier location on a single attribute say, labor cost alone. With these issues in mind, a research project was formulated with two primary objectives. First, the authors wanted to compile the knowledge and perceptions of purchasing managers regarding low cost regions and their capabilities and to reflect the multiple factors involved in current sourcing strategies and supplier selection decisions in these low cost geographies. Second, the authors wanted to compare managers' subjective perceptions with objective data regarding attributes of sourcing locations to identify the relationship between perceptions and reality. This paper aims to explore the issues. Design/methodology/approach - The authors surveyed over 100 sourcing professionals on their perceptions of various low cost sourcing alternatives. Perceptual mapping techniques were used to combine the rankings on some 12 different attributes to visualize how the various attributes relate to each other and how the low cost regions compare when rated against sourcing managers' ideal perceptions. Findings - The research results show that procurement managers select regions for low cost sourcing based on both specific measures and individual and/or group perceptions of the region, whether these perceptions are correct or not. This paper probes these perceptions. Also the paper compares these subjective perceptions with objective data to show that cultural stereotypes may bias managers' perception of location-specific characteristics. The paper closes with implications for procurement managers and opportunities for further research. Practical implications - The authors have demonstrated that purchasing managers choose sourcing locations using multiple criteria instead of only focusing on cost. But some perceptions are biased by cultural stereotypes and do not reflect reality. This suggests that managers have to be careful when using their subjective judgment in choosing sourcing locations. Originality/value - The authors believe that visual representations of alternative sourcing options have great potential to improve the efficiency of cross-disciplinary and multi-company teams that are increasingly responsible for global sourcing strategies. Comparing managers' perception with objective data of location attributes shows that mangers' perception may be biased by cultural stereotypes.

AB - Purpose - There is good evidence that the shift in global sourcing is toward so-called "low cost country suppliers." Yet conditions in these countries are often not well-known. At the same time, best practices in integrated supply dictate a multi-faceted decision, rather than basing supplier location on a single attribute say, labor cost alone. With these issues in mind, a research project was formulated with two primary objectives. First, the authors wanted to compile the knowledge and perceptions of purchasing managers regarding low cost regions and their capabilities and to reflect the multiple factors involved in current sourcing strategies and supplier selection decisions in these low cost geographies. Second, the authors wanted to compare managers' subjective perceptions with objective data regarding attributes of sourcing locations to identify the relationship between perceptions and reality. This paper aims to explore the issues. Design/methodology/approach - The authors surveyed over 100 sourcing professionals on their perceptions of various low cost sourcing alternatives. Perceptual mapping techniques were used to combine the rankings on some 12 different attributes to visualize how the various attributes relate to each other and how the low cost regions compare when rated against sourcing managers' ideal perceptions. Findings - The research results show that procurement managers select regions for low cost sourcing based on both specific measures and individual and/or group perceptions of the region, whether these perceptions are correct or not. This paper probes these perceptions. Also the paper compares these subjective perceptions with objective data to show that cultural stereotypes may bias managers' perception of location-specific characteristics. The paper closes with implications for procurement managers and opportunities for further research. Practical implications - The authors have demonstrated that purchasing managers choose sourcing locations using multiple criteria instead of only focusing on cost. But some perceptions are biased by cultural stereotypes and do not reflect reality. This suggests that managers have to be careful when using their subjective judgment in choosing sourcing locations. Originality/value - The authors believe that visual representations of alternative sourcing options have great potential to improve the efficiency of cross-disciplinary and multi-company teams that are increasingly responsible for global sourcing strategies. Comparing managers' perception with objective data of location attributes shows that mangers' perception may be biased by cultural stereotypes.

KW - International business

KW - Sourcing

KW - Supplier evaluation

UR - http://www.scopus.com/inward/record.url?scp=41649083176&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=41649083176&partnerID=8YFLogxK

U2 - 10.1108/09600030810866995

DO - 10.1108/09600030810866995

M3 - Article

VL - 38

SP - 224

EP - 243

JO - International Journal of Physical Distribution and Logistics Management

JF - International Journal of Physical Distribution and Logistics Management

SN - 0960-0035

IS - 3

ER -