Organizational Buying Model Essay

906 words - 4 pages

MODELS OF ORGANIZATIONAL BUYING BEHAVIOR

INTRODUCTION
Organizational buying is a complex process of decision making and communication, which takes place over time, involving several organizational members and relationship with other firms and institutions. It is much more than a simple act of placing an order with the suppliers. In this sense, organizational buying behavior is the decision making process by which formal organizations establishes the need for purchased products and services and identifies, evaluate and choose among alternative brands and suppliers.
Industrial or Business buyers are influenced by many factors when they make buying decisions. Generally, business buyers are ...view middle of the document...

The environmental variables can change organizational buying plans. For instance, political conflict in a nation can affect the growth rate of the economy which may influence purchasing plans of companies. The economic environment influences a firm's willingness and ability to buy. Technological changes influence buying decisions.
Organizational variables: The Webster and Wind model gives importance to four sets of organizational variables. These are- technology relevant to purchase, organizational structure, organizational goals and tasks, and members of buying centres. These four variables interact with one another to determine organizational functioning and buying centre individuals' attitudes, goals and assumptions used in buying decision making.
Buying centre variables: the functioning of buying centre is analysed by interpersonal or social interactions of participants and group functioning. The interpersonal or social interactions depend on the role of each participant or individual member of the buying centre. The group functioning is influenced by ,
1. individual member's goals and personal characteristics,
2. the nature of leadership in the group,
3. the group tasks and structure, and,
4. external influences, which inclide organizational and environmental variables.
The buying centre includes five roles:
Users- those members of organization who use the purchased products and services.
Buyers- those with formal responsibility and authority for contracting with suppliers.
Influencers- those who influence the decision process directly or indirectly by providing information and criteria for evaluating alternative buying actions.
Deciders- those with authority to choose among alternative buying actions.
Gatekeepers- those who control the flow of information (and materials) into the buying centre.
Individual Variables: The Webster and Wind model mentions that individuals make buying decisions in the organizational and interactional settings. Only individuals can define problems, make buying decisions, and act accordingly.The individual buying behavior is motivated by individual needs, desires, perceptions, learning, in complex interaction with organizational objectives.
Individual decision making merges into a group decision making process, which includes bargaining, negotiation and...

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