International Purchasing Offices in China Roles and resource/capability requirements

Purpose – This paper addresses global sourcing organisational design through the following research questions: 1) How do the roles performed by International Purchasing Offices (IPOs) change over time? 2) What are the resources/capabilities required by an IPO for an effective performance and how do they change over time? and 3) What are the contingent factors affecting such changes? Design/methodology/approach – We employed an exploratory multiple case study approach and analysed 14 Western IPOs located in China for a period between 2007 and 2012. The data were primarily collected through 34 direct, semi-structured interviews of IPO heads and sourcing managers or senior buyers. Findings – We identify and discuss the importance of 10 roles played by IPOs and 12 required resources/capabilities. Furthermore, considering the changes that occurred to these IPOs over a five-year period (2007-2012), we observe three distinct evolutionary behaviours (i.e. ‘overall development’, ‘selective development’, and ‘stable configuration’) and highlight three contingent factors that jointly affect these behaviours (i.e. the architectural and technological complexity of the sourced items, annual volume sourced abroad, and experience in the foreign context). Originality/value – This paper contributes to the resource-based view of the firm in a global sourcing context by highlighting the resources/capabilities required by IPOs and discussing their characteristics. Furthermore, it proposes a typology of IPO micro-organisational evolutionary behaviours. Finally, it applies contingency theory and identifies three factors that might affect the evolutionary behaviours.