The influence of the competitive landscape on cross-functional interactions between procurement and engineering

This study assesses the extent to which a firm's external environment shapes the cross-functional interactions between procurement and engineering, utilizing an embedded multiple-case study methodology. In summary, we found that high environmental ambiguity discourages procurement-engineering mutual understanding. High environmental uncertainty with moderate ambiguity, on the other hand, appears to foster both mutual understanding and inter-functional collaboration. Overall, procurement personnel are more optimistic than engineering personnel regarding the performance results stemming from cross-functional integration. Additionally, increasing job tenure for procurement personnel leads to a higher level of perceived integration with engineering, while engineers with longer job tenure report see less value in collaborating with procurement, often creating an asymmetric power distribution with engineering taking a dominating role.