WI Schwerpunktaufsatz

The Procurement Alignment Framework Construction and Application

The Authors

Mark Beukers Johan Versendaal Ronald Batenburg Sjaak Brinkkemper

Mark Beukers MSc Morgan Chambers Joop Geesinkweg 901999 1096 AZ Amsterdam The Netherlands mark.beukers@morganchambers.com Ir. Johan Versendaal PhD Ronald Batenburg PhD Prof. Sjaak Brinkkemper PhD Inst. of Information and Computing Sciences Utrecht University Padualaan 14 3584 CH Utrecht The Netherlands {j.versendaal|r.s.batenburg| s.brinkkemper}@cs.uu.nl

improved supplier relationships, and more [BeMo87; ChPL04; NaDa01; PrBe04; Spec85; VeBr03]. During the 1980s, several scholars identified the strategic importance of the procurement business function [Kral83; Sutt89]. Today, new areas of focus within procurement are arising from which companies may benefit: supplier relationship management, e-procurement, trading exchanges, and collaborative engineering [e.g. DaGP03; Gro04; VeBr03]. At the same time anecdotal evidence shows that many procurement initiatives in general, and Information Technology (IT-)implementations in the procurement domain in particular (like e-procurement software implementation), are not successful or do not deliver promised benefits [e.g. Adam01; DaGP03; PaPF04]. We define Information Technology (IT) as all kind of technology to manage and process information; this includes hardware and software. A 2001 study by the Conference Board points at problems on the implementation side of procurement solutions [Palf01]. It concludes that consultants have been

widely criticized for overstating the business case for e-procurement; organizations are finding implementations more complex, more expensive, and more time consuming than they originally envisioned. In general, scholars have recognized the contradictory effects of (especially) IT deployment in organizations and some have indicated general directions for dealing with them [cf. Bryn93; RoBo99; HoKi02; AlAZ03]. Very few take an IT/business alignment type of perspective. Aligning the business of organizations with their IT (initiatives) may be a promising strategy in improving firm performance and avoiding IT deployment failures [e.g. AJPW04; CrKH02; HeVe93]. Research question and methodology outline While there are many procurement maturity improvements to achieve in organizations, procurement initiatives like e-procurement deployment and implementation may easily fail. Scholars have identified IT/business alignment as an important principle for the success of IT deployment

Executive Summary

1 Introduction
Recently the procurement business function received increasing interest from both scholars and practitioners. This has been driven by numerous benefits and potential procurement performance improvements like reduced operational procurement costs, improved quality of purchased goods, shortened procurement lead times,

We define a framework that:

&

&

& &

contains an integrative procurement view, taking into account multiple business and IT perspectives; allows for an assessment of procurement maturity and degree of alignment among the business and IT perspectives; identifies a procurement maturity growth strategy for business and IT perspectives; includes a situational deployment by procurement spend categories.

The framework provides an approach for IT/business alignment in the procurement function domain, supporting procurement performance improvement.

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and implementation. Therefore, the research in this paper is driven by the need for a structural procurement strategy. We use and further explore theory on IT/business alignment, and more specifically IT procurement alignment. Our aim is to: Identify strategies to accomplish significant added value for procurement through the development of an integrated procurement alignment framework. In this paper a generic Procurement Alignment Framework (PAF) is described, which builds upon insights from IT/business alignment and existing procurement development frameworks. The PAF enables us to assess organizations that are in different procurement maturity stages, based on the capabilities identified and found applicable for these different levels of maturity. What makes the framework unique in comparison to other known developmental procurement models [ReLo88; Keou93; WeRi00] is 1) the fact that the situational aspect provides a more practical application of the framework. Laying focus on specific procurement segments (spend categories) instead of looking at corporate procurement maturity in general, eases the actual application of the framework within corporate environments. Moreover, 2) the application of the PAF inherits the concept of IT business alignment, which is not taken into account in any of the existing maturity frameworks. Finally, 3) IT is addressed explicitly, and is valued equal to business perspectives. The PAF provides a basis for identifying the procurement capabilities within an organization. Based on insight of existing organizational capabilities, specific advice can be given concerning missing or more mature procurement capabilities. The framework is applied at a large Dutch financial service provider. Organization of the paper In the following section we provide more detail on procurement, along the three pillars of the PAF: procurement maturity, IT/business alignment, and procurement segmentation, resulting in the creation of the PAF. Section 3 describes the frameworks operationalization through generic procurement capabilities identification and the efforts taken to validate the framework. Section 4 describes the results of the case study in which the framework was applied in a real-world situation on three procurement spend categories. We will close this paper by drawing conclusions and presenting our research agenda.

2 The Procurement Alignment Framework

Procurement Maturity The first pillar of our theoretical framework is based on the concept of maturity levels. In general, the idea of maturity is presented by sketching a number of growth stages that depict the potential upward development or performance of organizations during several sequential periods of time. In most representations time or periods are labeled on the horizontal axis, whereas the performance level is projected on the vertical axis. Within the field of information systems, the Nolan model is frequently quoted as the origin of the maturity perspective [Nola79]. Nolans model represents the specific pattern of IT-adoption or IT-management by organizations. With the adaptation of the Nolan growth model by the movement of quality management and related activities, the principle of defining stages of growth was further extended and applied to the development of organizations or their parts. Within the field of information systems planning, Earls model of learning curves in relation to IT can be considered as one the first examples of this extension [Earl89]. Since then, both the original Nolan and Earl models have been revised, extended, specified and modified, in line with progress made in the field of information systems and software engineering [GaSu91]. The fact that significant advantages can be achieved in developing the procurement function, including leveraging IT for procurement, is described by many authors [Cavi91; Herb93; Kral83; VeBr03]. During the last two decades numerous authors proposed and constructed procurement maturity development models, most of which assume a stage/step-wise development. Van Weele, et al. [WeRi00] derive an integrated theoretical purchasing development model, based on twelve different models (among others [Keou93]) to address procurement maturity in six development stages:  Transactional orientation (no procurement strategy, procurement is just acting on purchasing requests from the rest of the organization);  Commercial orientation (mainly costoriented purchasing);  Purchasing co-ordination (basic sourcing and purchasing optimization is in place within the procurement department);  Internal integration (the procurement department is considered as a strategic

internally integrated part of the overall organization);  External integration (suppliers are considered valuable integrated resources for the organization);  Value chain integration (the procurement department is contributing to the effectiveness of the entire consumer supply chain). Although Van Weele, et al. have not published scientific evidence that these six stages actually represent the six developmental stages of procurement it is our belief that the extensive research conducted by these authors justifies the inclusion of the stages in the PAF. IT procurement alignment Ever since IT-metrics have emerged as a specific field, scholars have searched for models and techniques to measure if organizations have invested the right IT, aimed at the right processes and at the right moment [cf. Venk89]. Brynjolfsson in particular contributed to this field as one the first to debunk the productivity paradox in 1993, providing empirical evidence that IT indeed adds (tangible and intangible) benefits to the firm [Bryn93; BrHi95; BrHi00]. The breakthrough of IT/business alignment however was provided by Henderson and Venkatramans strategic alignment model [HeVe93]. Because of its two-dimensional (quadrant) type, the model is both simple and powerful in pointing the importance of leveraging IT through multiple or multi-level alignment. Business strategy, IT strategy, organizational infrastructure & processes, and IT infrastructure & processes should be in balance. Likewise, Sabherwal, et al. [SaHG01] define six types of alignment within the strategic alignment model. In addition, they stress the need of couching these alignment types over time. Organizations go through evolutionary and revolutionary periods of change if IT is deployed and structured processes are mutually adapted. Other scholars considered the business domain within the IT/business alignment model as too global and abstract, and developed extensions of the model. This is done by the strategic alignment model of Turban, et al. [TuMW99] and also by Scheper [Sche02]. In his version of the IT/business alignment model, Scheper builds upon the original proposition that synchronizing or leveling (business and IT) domains will significantly contribute to organizational performance. His extension is in the decomposition of the business domain by defining four business perspectives that are

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crucial parts of every organization to be integrated: 1) strategy and policy; 2) monitoring and control; 3) organization and processes and 4) people and culture. Information technology can be considered the fifth perspectives completing the extended IT/business alignment model. Consequently, optimal alignment within this model implies that all (five) perspectives should (1) attain similar maturity levels and (2) should be mutually adjusted to achieve balance and hence optimal conditions for business performance. Based on a benchmark study over 265 Dutch housing corporations this proposition is confirmed [Sche02]. In addition, the hypothesis was supported for the CRM business domain by data collected among 30 CRM-managers [BaVe04]. In this paper we apply the extended IT/ business alignment model to the procurement domain: (IT) procurement alignment. In doing so, we combine the model with the concept of procurement maturity as described above. This is done by mapping the six (general) procurement maturity stages to each of the business/IT perspectives. Before we demonstrate this, we include a situational dimension: the concept of segmentation additionally contributes to the PAF as we will show in the next sub-section. Procurement Segmentation The third pillar focuses on of procurement segmentation. By the mid-nineteeneighties Peter Kraljic was an advocate of procurement segmentation. The author called for nothing less than a total change of perspective, bringing the organization from purchasing (operating function) to supply management (a strategic one) [Kral83]. In order to make this statement more tangible Kraljic suggested implementing a supply strategy that segments goods and services into four categories: strategic items, bottleneck items, leverage items and non-critical items. Based on the position of the purchase item within his so-called portfolio matrix, a generic segmented strategy is applied, resulting in a more cost effective corporate procurement procedure. As researched by the Hackett Group [Hack03], the best global companies are moving to a hybrid procurement operation model. This model on the one hand centralizes activities like buying commodities for multiple business units; on the other hand decentralized activities (like supplier scheduling) are best handled at the businessunit level. Subdividing the procurement

function in a number of appropriate categories of expenditure enables the organization to assign specific procurement officers to centre on these identified categories. Against the background of this study the most suitable unit of segmentation within the large financial service provider seems to be the described procurement segmentation by spend categories. Other organizations use a similar form of segmentation, such as Invensys at which the implementation of a procurement database shaped the basis for spend category identification and segment formation around these identified categories [Aver00]. Resulting Framework The PAF is built upon three concepts and is visualized as a three-dimensional model in Figure 1. The PAF models the procurement status of an organization based on three basic factors: 1. The maturity level (ranging from transactional orientation to value chain integration) of each of the five business/IT perspectives, i.e. the firms (i) procurement strategy and policy, (ii) the procurement organization and processes, (iii) the monitoring and control of procurement, (iv) people and culture with respect to procurement, and (v) procurement IT (e.g. procurement modules of ERP, e-procurement and so on); 2. The level of alignment between the perspectives, i.e. the similarity/balance between the different maturity levels; 3. The segmentation of overall alignment and maturity, according to procurement segment/spend category. We believe the PAF is unique for its integration of the three factors and related perspectives.

3 Framework Operationalization and Application

Procurement Capabilities Identification In order to make the concepts of procurement maturity and alignment both measurable and applicable, we operationalized the framework by identifying specific capabilities for the five generic business/IT perspectives. For each of the thirty cells per business/procurement maturity stage capabilities are listed. In the operationalization of the PAF, capabilities were collected and defined with the help of existing business procurement frameworks [notably ReLo88; Keou93; Cavi99; WeRi00; Jone99]. In addition the identified capabilities were supplemented with IT-features from the main procurement software vendors (SAP, Ariba, Oracle). Many capabilities for each of the perspectives were listed. Three examples of these capabilities for the dimension Monitoring & Control on the maturity level Commercial orientation are:  Formal establishment of supplier base management through supply base optimization,  Primary purchasing objectives are concerned with supplier identification and the expedition of orders and  Success is largely measured by the functions ability to find competitive bids and thereby meet (or beat) the assigned budget while still fulfilling its duties (key measure is purely financial). The capabilities are not differentiated towards procurement segments, as in principal indefinite types of segments can be identified. Instead the capabilities are defined generically, though they are applic-

Segment

...

Segment C Segment B Segment A Business Dimension Strategy and Policy Organization and Processes Monitoring and Control People and Culture Information Technology Transactional Orientation Commercial Orientation Purchasing Coordination Internal Integration External Integration Value Chain Integration increasing maturity increasing maturity increasing maturity increasing maturity increasing maturity

Figure 1

The Procurement Application Framework (PAF)

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able for specific procurement segments as will be explained in the next subsection. Application of the PAF The PAF can be used on a drill-down basis (see figure 2). Per segment the organization is able (through procurement capability assessment as demonstrated in the case study section) to see how the different business/ IT perspectives perform. The framework uses the procurement alignment principle for a particular procurement segment, i.e. the highest scoring business dimension is the set target. This local optimum can be used to improve the remaining perspectives, to achieve an optimal maturity level based on the missing capabilities per business dimension, and thereby improving overall alignment between the five perspectives. While the target maturity level is used for realizing short-range improvements, for the longer term the organization should determine which types of procurement segments need what level of maximum maturity for each business/IT perspective. Taking into account the portfolio matrix as described by Kraljic [Kral83] some procurement segments could be marked more strategic than others. This may have consequences for the level of desired maturity growth for that specific segment. From a more practical point of view, the organization could also look at best-practices from a specific type of industry or corporate size in the determination of the maximal maturity level of a segment. Framework validation To validate the theoretical concept of procurement maturity and procurement alignment, and to validate its operationalization, we performed two types of validation: 1) expert validation as proposed by Rossi, et al. [RoFL99], and 2) empirical validation. These two types of validation differ in

Segment

Dim. 1

Dim. 2

Dim. 3

Dim. 4

Dim. 5

Req.

Req.

Req.

Req.

Req.

Figure 2 the PAF

Drill-down Application of

1) involved participants: purchasing consultancy experts, versus purchasing managers, 2) number of participants: 10 versus 54, and 3) purpose: framework construction validation only versus framework application and company benchmarking. We discuss the two types of validation below. For the first type of validation procurement experts were interviewed and asked to judge the framework. The participants consisted of procurement/supply chain consultants of major IT and management consultancy firms. Ten experts participated in judging and validating the framework construction and the composition of its pillars (including associated capabilities). The validation sessions were held in two iterations. During the first iteration the central aim was to validate the framework construction in an effort to deliver a more comprehensive framework for the second iteration. The experts received a short introduction, in which provision of background information to the research, and common understandings of the procurement domain were agreed upon. Leading interview questions in the first iteration were: 1) Do you recognize the equal importance of all five perspectives in maturing the procurement function an organization? 2) Do you think that additional perspectives/dimensions need to be taken into account? 3) Do you recognize procurement segments as separate dimension in the framework? Also, the framework operationalization was subject to discussion. During the second iteration the participants judged the overall framework construction again, but focussed in extensive detail on its operationalized capabilities based on their specific knowledge and expertise in daily practice. In the first iteration, without exception and according to all experts, the choice for procurement maturity, procurement alignment, and procurement segmentation as the three pillars of the PAF made perfect sense. Also the five perspectives of procurement alignment were considered of value, and no need for more perspectives was identified. Based on interviews in the second interation a number of capability changes were made. An example of such a change was concerned with the principle of Total Cost of Ownership (TCO). Although not specifically mentioned in the studied procurement development models, TCO is considered a valuable method in the procurement of goods and services by many other scholars [see also CaIt92; ElSi98]. Besides the shift in capability positioning and identification of new capabilities, seemingly overlapping capabilities

were identified and merged. The initial version of the framework comprised nearly 300 identified requirements. While in the end the validation efforts resulted in a list of 200 validated strong capabilities. The second type of validation (empirical validation) was inferred from survey sessions in the late Autumn of 2005, in the context of a study of procurement organization benchmarking using the procurement framework [BaVe06]. Based on the operationalized capabilities of the framework, a questionnaire was constructed. Each of the five framework procurement alignment perspectives was represented by 10 statements of increasing maturity. By conducting the questionnaire with a substantial number of respondents (54 purchasing managers from small, medium and large sized Dutch companies), the statements were answered and hence empirically validated. Respondent participation was partly solicited through cold calling, and mostly from the social and business networks of Business Informatics students at Utrecht University. The respondents were divided over six sessions of the same type (resulting into 6-13 respondents per session); open discussion after questionnaire completion was encouraged. Respondents provided their answers to the questionnaire through electronic meeting software [e.g. WeNu99] in the decision support lab of Utrecht University (www.cs.uu.nl/beleidslab). The purchasing managers were only introduced to the framework after completing the questionnaire. Based on the questionnaire, a scale was constructed for each perspective. Scale analysis, i.e. Cronbachs alpha tests, indicated the scalability and therefore validity of the statements. The Cronbachs alpha values varied between 0.76 (for the 10 statements of the strategy and policy perspective) and 0.86 (for the 10 statements of the IT perspective) demonstrating that for each procurement alignment perspective the statements coincide and form an internal consistent reliable scale. We believe that the capabilities of the framework, from which the statements in the questionnaire were derived, are well chosen and formulated as determined after the first type of validation. For the full questionnaire and more details of the broader context of study from which we inferred this validation we refer to Batenburg and Versendaal [BaVe06].

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4 Case Study: Dutch Financial Service Provider

Application of the PAF The framework was applied at a large Dutch financial service provider. As part of a worldwide group, the board of directors of this Dutch subsidiary aimed to achieve professionalization throughout all its corporate business functions, including the procurement function. During this application the organization was coming to the end of a restructuring process. Supporting functions were grouped in corporate staff functions. The change project started mid 2003 and included the formation of a centre-led procurement function. In its new corporate structure the organization segments its procurement function around five main procurement segments: Information and Communication Technology (ICT), marketing & sales, human resources, general and technical services, and a surplus segment. In applying the PAF we chose those procurement segments that were already included explicitly in the organizational change: procurement of ICT, procurement of marketing & sales related items, and temporary staff employment. Note that ICT is the procurement segment explicitly defined by the financial service provider as one of their spend categories for which they do purchases (e.g. purchasing computers, telephones, and the like). Although basically referring to the same domain, in

our study ICT as a spend category is different from the IT perspective of the PAF. Referring to figure 1, in our study IT is one of the values on the Y-axis, while ICT in our case study is one of the values on the Zaxis. So for example, the PAF indicates that for the buying of ICT type of goods, the financial service provider could leverage an e-procurement system from an IT perspective. In order to assess the actual maturity of a procurement segment a list of statements was created covering the capabilities identified in the operationalization of the PAF. Note that these statements served as an important source for the construction of statements for the second type of validation (described previously). An example of a statement used in the case study for the business/IT perspective strategy and policy is: A supplier development program is available within the procurement segment to help preferred suppliers to reach the same procurement maturity level as the organization itself. All statements were presented as 5-point Likert scales, varying from fully agree, agree, neutral, disagree to fully disagree. Procurement managers of the procurement segments were asked to answer the statements to assess the current situation for their segment using the framework. In order to compare the current maturity status, additional retrospective research was conducted to obtain the historic (20012002) procurement maturity status, i.e. before the newly formed centre-led procurement function. With such a com-

parison the effectiveness of the organizational change for procurement could be identified, as well as the usefulness of the framework itself. Procurement managers were approached who had been involved in one of these segments in this period. To countermeasure the negative effects of retrospective research such as recall biases and cognitive errors [GoSt01] most statements explicitly referred to the timeframe and the associated procurement segment. For example, see a statement covering the business dimension Human and Culture: During the years 20012002 the concept of job-rotation programs was applied within the segment. Besides that, the participants were guided through the list of statements enabling open discussions on certain topics. Results Based on the mentioned situational aspect of the PAF the results are presented per procurement segment in a radar diagram. Figures 3 and 4 show the results of two procurement segments: marketing & sales, and ICT respectively (for reasons of brevity the procurement segment temporary staff is not depicted). The numbers on the axes indicate the PAF maturity levels. Level 10 equals a Transactional Orientation, level 20 equals a Commercial Orientation, etc. The values on the axes were calculated by cumulatively adding statement scores per business dimension. Per diagram, three sets of values can be identified: past procurement maturity, present procurement maturity, and short-range future procure-

Strategy & Policy 60 50 40 30 Information Technology 20 10 0 Organization & Processes Information Technology

Strategy & Policy 60 50 40 30 20 10 0 Organization & Processes

People & Culture

Monitoring & Control

People & Culture

Monitoring & Control

Past procurement maturity

Present procurement maturity

Short-range future procurement maturity

Figure 3

M & S Procurement Maturity

Figure 4 ICT Procurement Maturity

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ment maturity. Generally it can be concluded that temporary staff employment has increased by about 29%. In comparison with the other two this segment scores best. Marketing & sales has seen an increase of about 27%, while the ICT segment has seen the lowest increase of 17%. Taking a closer look at the procurement segment marketing & sales, currently the highest scoring dimension is monitoring & control. For short-range procurement improvement this highest scoring dimension serves as target situation for the other four perspectives (visualized as the most outside dotted line). The organization should try to improve the other perspectives in this segment to the same level as monitoring & control, and thus achieving the PAF maturity level Internal integration (equals 40). As the other perspectives are unable to fulfill a number of lower-level capabilities, the organization should try to implement these missing capabilities first. In the actual application of the framework the Dutch financial service provider received a detailed report highlighting which capabilities were missing at what dimensional levels, together with a detailed description of these capabilities. For reason of brevity, we describe the situational advice for the dimension Information Technology for the spend categories ICT and marketing & sales, as it was provided to the financial service provider. The capabilities identified in the assessment that should at least be taken into consideration are:  Implementation of a procurement aimed information system to improve the effectiveness of data/information retrieval, to reduce manual transactional activities, and to improve reporting.  Implementation of a vendor management system (or module), enabling improved supplier monitoring and control capabilities.  Capabilities concerning the corporate website on which information regarding (preferred) suppliers is available, including information about supplier performance and corporate agreed upon service level agreements. If it is the desire of the organization to improve segmental and aligned procurement in a structured way, the missing capabilities should be taken into account with priority. As long as these capabilities are not implemented, further maturity growth can be jeopardized. Currently the identified missing capabilities are being implemented by the financial service provider in the deployment of a procurement information sys-

tem. The PAF assessment provided the organization with explicit capabilities and criteria for selecting the vendor of the procurement system. We interpret this as another contribution to the validity of the PAF. By taking assessments from the past and future we saw that maturity increased while organizational change obviously included maturation in all perspectives (except IT). Again, this encouraged us that the PAFs structure and operationalization are well chosen.

5 Conclusions
In this paper we constructed the Procurement Alignment Framework (PAF) that contributes to the research question Identify strategies to accomplish significant added value for procurement through the development of an integrated procurement alignment framework. The PAF enables organizations to visualize the maturity status of the corporate procurement function. By integrating the concepts of procurement maturity, procurement alignment and procurement segments (i.e. spend categories), the framework is a valuable innovation to the field of corporate procurement. This also has implications for the commercial application of the PAF. In trying to countermeasure failing procurement initiatives organizations should try to align their procurement segments over the five stated procurement/IT perspectives. Organizations willing (and bold enough) to visualize their corporate maturity and level of alignment through the PAF will be pointed to missing (or misplaced) capabilities. Using the PAF organizations are enabled to reach higher levels of maturity and balance. This increase in maturity and alignment will consequently result in the procurement function operating in its organizational role as a strategic contributor. The PAF and its associated procurement capabilities were internally validated through expert interviews by procurement/supply chain consultants of major IT and management consultancy firms. The framework was applied at a large Dutch financial service provider. Both the fact that the assessed procurement maturity has increased over time at the case study organization, and the fact that the financial service provider is convinced that our advice is of current and future value, we feel encouraged by the validity and usefulness of

the PAF. Also the more extensive empirical validation with 54 procurement managers from 54 different organizations supports the validity of the PAF. An increasing area of interest is the procurement of complex services, like application service providing and outsourcing [e.g. BrWi05]. In these areas scientific literature is increasingly available and presents classification and possible outsourcing strategies. An area for future research is to compare and combine those strategies with the PAF for specifically those procurement segments. Future research is also aimed at evaluating the PAF through the application of the framework in a large number of organizations spread over multiple sectors, as initiated by Batenburg and Versendaal [BaVe06]. Wider application of the PAF results in benchmark data, identifying best practices, and consequently long-term maturity levels for the five business/IT perspectives of an individual organization. Besides wide application of the framework through benchmarking, future research should be aimed at utilizing Kraljics Portfolio matrix [Kral83] in the determination of the possibilities for segmental growth within the framework. It would be interesting to study the categorization effects of identified procurement segments with respect to maximum bound maturity levels of the five business/IT perspectives. Finally, as the principles of maturity and alignment apply beyond the procurement business function, we encourage further research and framework construction in other domains. In the sales domain Batenburg and Versendaal [BaVe04] have constructed a similar framework including the five business/IT perspectives, providing direction for marketing and sales.

Acknowledgements
The authors would like to thank the anonymous reviewers and editors for the useful comments and suggestions regarding this paper.

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Abstract
Procurement has become increasingly important for organizations acting in dynamic supply chains and competitive markets. In practice however, companies struggle with adapting and improving their procurement business function. In line with the general trend in management and organization studies, both scholars and practitioners aim to define an integrated procurement policy that is truly aligned on all organizational and IT aspects. The central aim of this paper is to present a framework that supports the definition and application of such an integrative procurement approach. The framework is developed upon insights from IT business alignment (more specifically IT Procurement alignment), procurement maturity measurement and segmentation. It facilitates organizations in monitoring the maturity and alignment of their procurement on five different business/IT perspectives. In addition, the framework enables specific procurement improvements by taking the situational aspect of procurement segmentation into account. The framework was validated twice: through interview expert consulting and through a questionnaire using scale analysis. In a case study it was found suitable for assessing procurement maturity and identifying concrete procurement improvements. Keywords: IT/Business Alignment, Procurement, Purchasing, Maturity, Case Study Method

WIRTSCHAFTSINFORMATIK 48 (2006) 5, S. 323330

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