Benchmarking in the purchasing function: impact on purchasing performance and business performance.

Abstract

The importance of benchmarking in the achievement of better results in the purchasing function and in overall business performance has been asserted in several textbooks, and in the practitioner and academic literature. However few studies have addressed the implementation of benchmarking in purchasing and its impact on purchasing and business performance. Data was collected from 306 companies and structural equations modeling is used to develop valid and reliable instruments for benchmarking, purchasing performance and business performance. The results show a significant positive impact of benchmarking on purchasing performance and an indirect positive effect on business performance. Implications of the findings for purchasing management are discussed.