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Organizations increasingly manage innovation projects jointly with suppliers to use external resources to fill internal competencies. However, little is known about the practices of how companies configure internal and external resources to enhance competitiveness. Drawing on resource orchestration theory, this study aims to propose a novel approach to explain organizational performance using purchasing orchestration (PO) as an antecedent. The paper then tests an empirical model to assess the impact of PO practices on innovation and financial performance.

Cross-sectional survey data from 247 supply chain managers are used to test hypotheses relating PO to performance. SPSS PROCESS is applied to test conditional direct and indirect effects.

The positive impact of PO practices on innovation and financial performance is confirmed. Results indicate an organization’s entrepreneurial orientation (EO) can strengthen the positive relationship between PO and financial performance. Structuring, bundling and leveraging external resources are introduced as new organizational capabilities.

This research is based on cross-sectional data, and unidimensional constructs are used.

This research guides managers on the innovation process in light of the growing importance of external resources. The manuscript highlights the role of strategic purchasing in establishing new resource capabilities as a competitive advantage.

This research provides new insights into the relationship between purchasing practices and organizational performance and helps better understand the implications of orchestrating supply chain resources. A novel construct, PO, is introduced as a theoretical basis for studying supply chain-enabled innovation.

The purpose of this research is to develop an understanding of how purchasing can become meaningfully involved in complex business-to-business service purchases.

A single in-depth case study method of an exemplar organization was applied to better understand the purchasing function’s role in adding to the value proposition in complex, non-traditional business-to-business service purchases.

Powerful allies or advocates can mediate purchasing involvement in service procurement. However, once the involvement is initiated, purchasing must make a positive contribution with respect to the specific needs and expectations of the budget owner to retain its influence.

This research extends institutional theory to show how powerful allies or advocates can mediate purchasing involvement in the complex services spend.

This study describes the potential impact of purchasing’s involvement in complex services spend and highlights the opportunities for purchasing managers to improve supplier management and drive out additional costs.

For the business practitioner, this research provides evidence regarding how individual functions can gain influence in the organization. A conceptual model describes the meaningful involvement of purchasing in complex business-to-business service purchases.

A supplier may sell not only to one buyer (sole relationship configuration) but also to the buyers competitors (shared relationship configuration) for a specific product category. This study examines the performance implications when suppliers establish shared relationships with the buyer’s competitors.

Secondary data are used to test hypotheses relating a supplier’s relationship configurations to its operational performance. A seemingly unrelated regression approach (SUR) is applied to analyze the data, followed by endogeneity checks of the empirical findings.

The study shows that suppliers with less-shared ties with buying firms’ competitors exhibit superior inventory efficiency and asset turnover. Thus, suppliers can improve operational efficiency by creating relatively exclusive, deep and trust-based relations instead of more extensively shared and shallower relationships.

Based on agency theory as a theoretical lens and aerospace industry data, this research contributes by addressing the supplier’s perspective and linking its operational efficiency performance with its chosen supply relationship configuration.

Suppliers need to understand the performance implications of choosing relatively exclusive relationships versus shared relationships with buying firms. The research provides new insights for managers and can guide their supply chain decision-making.

Little is known about how a supplier’s relationship configurations can elevate, or impair, its operational efficiency. While conventional wisdom holds that suppliers should focus on multiple avenues of revenue growth by selling to buyers’ competitors, this study demonstrates that more sales to a buying firm’s rivals might, in fact, reduce a supplier’s efficiency.