Analyzing the Effectiveness of Property Developers' In-house-Developed Versus Outsourced Systems on Procurement Efficiency

Abstract

Digital solutions have greatly progressed the automation of procurement functions across industries, including real estate. This study focused on analyzing the effectiveness of in-house-developed applications compared to outsourced systems on the procurement efficiency of property developers. Regardless of the company size, procurement involves several steps to obtain the goods and services needed for the business. One of the distinct functions of the procurement department is to ensure that purchased materials, or services conform to specified requirements at the most economical but good quality and in favorable terms. Streamlining systems, procedures, and processes, overcoming operational challenges, and establishing a sound business culture with well-integrated solutions are the objectives of digitization. This research study aims to ascertain the efficacy of internally developed systems versus externally obtained software for procurement efficiency of real estate developers in Makati City, Philippines, with 65 respondents. The researchers aim to examine the respondents’ perception of the perceived usefulness and perceived ease of use of in-house-developed systems compared to outsourced applications in achieving procurement efficiency with consideration of the company size and users’ age group. The researchers made use of descriptive and explanatory research methods for the investigation of the significant relationship and differences between the two digital platforms. The results of the study show several significant implications. The demographic profile of the respondents plays a relevant role in the assessment of the effectiveness of internally developed software versus outsourcing for procurement efficiency. Distinct differences were observed in terms of perceived usefulness and perceived ease of use between in-house-developed systems and outsourced systems. The findings indicate that individuals who utilize outsourced systems tend to exhibit a greater inclination towards strongly agreeing that their productivity is enhanced and their job performance is improved when utilizing such systems. Conversely, the findings revealed that participants who utilized internally developed systems exhibited a greater propensity to strongly agree that acquiring proficiency in the system and enhancing their skillset was a comparatively effortless endeavor. This study provides recommendations for procurement professionals, property developers, future researchers, and national and local governments to maximize the use of digital platforms for productivity and operational efficiency.