<p>Although many scholars assert that portfolio approach can facilitate purchasing to live up to its strategic importance and contribute to company performance; and practitioners have applied portfolio approach in various purchasing activities, there are still limited empirical researches to confirm that portfolio can actually create the benefits. The purpose of the study is to explore the usefulness of portfolio approach as well as why companies decide to apply portfolio approach in purchasing and supply management.</p><p>Based on an international survey carried on a large number of European and North American manufacturing companies, the findings of the study provide strong evidence on the significant impact that the purchasing portfolio approach has on the business results, and also shed lights on the strategic importance of purchasing as a direct explanation to the application of the approach by companies. The empirical study confirms that the competency of the purchasing professionals plays a prominent role on the path of transforming the strategic importance of purchasing, with the help of portfolio approach, to the success of improved purchasing performance. A cross-discipline theoretical study reveals that different models share a common theoretical foundation and consist of similar basic elements in their construct.</p><p>The results of this study fill the research gap in analyzing the causes of the application of portfolio approach; provide quantitative empirical proof on the usefulness of portfolio approach in the industrial companies and thus give support to the existing theories. The study contributes to a growing research stream on how to improve purchasing business performance, reflecting the increasing strategic role that purchasing is given. The results send useful messages to company managements and provide valuable insights on an important tool for improving purchasing business performance.</p>

Although many scholars assert that portfolio approach can facilitate purchasing to live up to its strategic importance and contribute to company performance; and practitioners have applied portfolio approach in various purchasing activities, there are still limited empirical researches to confirm that portfolio can actually create the benefits. The purpose of the study is to explore the usefulness of portfolio approach as well as why companies decide to apply portfolio approach in purchasing and supply management. Based on an international survey carried on a large number of European and North American manufacturing companies, the findings of the study provide strong evidence on the significant impact that the purchasing portfolio approach has on the business results, and also shed lights on the strategic importance of purchasing as a direct explanation to the application of the approach by companies. The empirical study confirms that the competency of the purchasing professionals plays a prominent role on the path of transforming the strategic importance of purchasing, with the help of portfolio approach, to the success of improved purchasing performance. A cross-discipline theoretical study reveals that different models share a common theoretical foundation and consist of similar basic elements in their construct. The results of this study fill the research gap in analyzing the causes of the application of portfolio approach; provide quantitative empirical proof on the usefulness of portfolio approach in the industrial companies and thus give support to the existing theories. The study contributes to a growing research stream on how to improve purchasing business performance, reflecting the increasing strategic role that purchasing is given. The results send useful messages to company managements and provide valuable insights on an important tool for improving purchasing business performance.