METHODS FOR ASSESSING THE STRATEGIC EFFECTIVENESS OF INTERNATIONAL PROCUREMENT: THE REPUTATIONAL DIMENSION

Abstract

Introduction. In the current climate of turbulent changes in the global economy and the deepening of the international division of labour, businesses are becoming increasingly involved in international activities, particularly in the field of procurement. The use of traditional procurement assessment methods is limited, as they do not account for ‘intangible’ risks. In a globalised world, a brand is responsible for the missteps of each of its suppliers. There is a need for a systematic analysis of the use of the reputational dimension as an integral indicator that links operational activities to the market value of the business and its long-term viability.

Purpose. The aim of this article is to develop and analyse a toolkit for the systematic assessment of reputational vulnerability in international procurement as a strategic lever influencing the market value of a business and its long-term viability. The main objective of this study is to substantiate the essence and structure of the concept of ‘reputational vulnerability’ in international supply chains as an integrated indicator of long-term business viability, to investigate the factors influencing management effectiveness, and to substantiate recommendations for improving assessment methods.

Materials and methods. The following scientific methods were employed in the course of the study: systematic analysis, structuring and integration of contemporary theories and practices of corporate reputation management. The study is based on an analysis of academic literature concerning methods for assessing the strategic effectiveness of international procurement and indicators for evaluating corporate reputation.

Results. This research paper analyses the tools for the systematic assessment of the reputational vulnerability of international procurement as a strategic lever influencing the market value of a business and its long-term viability. It provides a definition of the terms ‘reputational vulnerability’ and ‘reputational immunity’. Practical recommendations have been developed to enhance the strategic effectiveness of applying the indicators of ‘reputational vulnerability’ and ‘reputational immunity’. Using the developed model, a company can formulate various strategies for interacting with suppliers, adapting the level of attention to their importance and specific characteristics.

Prospects. Future research is encouraged to focus on developing criteria for measuring reputational vulnerability in the context of international procurement. The main task is to create multi-component indices that take into account financial losses, ESG criteria, and data from monitoring international media resources.