Multinational Procurement: Corporate Parent versus Subsidiary Perceptions

The international purchasing function is a critical element in the multinational enterprise's (MNE's) formulation of functionally integrated international policy and strategy and the implementation of strategy. A firm should have some understanding of the markets in which it operates as a consumer or buyer, since possible changes in resource or supplier markets can affect decisions related to the firm's marketing, production, and integration strategies. The supply consideration of MNEs represents risk and opportunity and may, as a result, have a significant influence on net income flows, both in the short and long run. Davis et al provides empirical evidence for assuming that the MNE's international procurement process influences and is influenced by its technological process, R & D, and product categories.