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Organizations often need to make decisions about where and how to obtain required goods or services. In-house production and procurement from the market are general solutions, which have been studied and applied to different situations. Organizations who choose to procure from external sources need specific and operational guidelines. E-procurement has advanced with the adoption of ICTs and various market mechanisms, leading to cost savings, strategic advantages and enhanced business relationships. Effective procurement requires the proper selection and utilization of existing mechanisms, and, if not feasible, then entails the design of advanced mechanisms or the adaptation to emergent variants.

The present research considers situations: (1) wherein B2B transactions involve multiple attributes of goods or services rather than price only, (2) wherein a number of suppliers participate and compete for the same contract, and (3) wherein the buyers do not wish to explicitly reveal their preferences. Existing procurement mechanisms meet one or two of these practical requirements; however, no such mechanism is available to support these transactions. There is a need to design and implement feasible mechanisms to solve this practical, yet challenging, problem.

Moreover, a number of normative guidelines have been proposed to help practitioners in selecting and using appropriate mechanisms, depending on the transaction characteristics. It has been widely accepted that auction is a good candidate for noncritical transactions and that negotiation is more appropriate to form strategic partnership. There are situations, however, wherein both auction and negotiation may apply (e.g. leverage procurement). Existing studies have focused on single-

attribute auctions and bilateral negotiations. There is a dearth of comparative studies on multi- attribute mechanisms.

Thus, this research aims to: (1) design and implement feasible mechanisms that meet the above requirements in e-procurement, and (2) gain a better understanding of their use and impact in e- procurement. Towards these goals, three studies are carried out. They are relatively independent but closely connected with each other, following the research roadmap (Section 3) and guided by the research framework (Figure 3-1 in Section 3.1). They also study the multi-attribute mechanisms from an information lens. Information is key aspect in market mechanisms, system design and decision making. The three studies address the following questions respectively:

 What information do the suppliers need to know? How to convey the information from the buyer to suppliers? (Study 1 in Section 4)

 How does information revelation affect the process, outcomes and bidders’ assessment in multi-attribute reverse auctions? (Study 2 in Section 5)

 Which (if at all) mechanism outperforms the other? Under what conditions will one mechanism outperform the other? (Study 3 in Section 6)

Study 1 focuses on the various information types and rules that are essential in mechanism design and implementation. This will not only allow us to explore alternative mechanisms for multi- attribute procurement transactions but also enable us to address specific needs and practical concerns in terms of information revelation in e-procurement. It presents two feasible mechanisms for multi- attribute multi-supplier transactions. They allow buyers to control preference representation and information revelation, assuring that suppliers obtain sufficient information in making effective proposals while protecting confidential information. Following the design-science approach, the mechanisms are implemented to support multi-attribute reverse auctions and multi-bilateral negotiations.

Study 2 examines the revelation of information in multi-attribute reverse auctions. Three revelation rules are formulated with admissible bids, winning bids and all bidders’ bids. Their effects on the process, outcomes and bidders’ assessment are tested in two experiments. The results show that: (1) it is sufficient for suppliers making meaningful offers when solely revealing dynamic information in the transaction process without direct disclosure of buyer’s preferences; (2) different types of information may lead to various effects such as anchoring, learning and signaling effects; (3) buyers and suppliers favor different rules of information revelation, considering the process efficiency and their gains (e.g. the suppliers reached better outcomes with either admissible bids only or all bidders’ bids, while the buyers gained more when revealing the winning bids only); and, (4) information revelation during the process appears not affecting participants’ assessment of the process and systems, whereas it is considered differently by the winners and non-winners in their perceptions of the outcomes and systems.

Study 3 compares multi-attribute reverse auctions and multi-bilateral negotiations in both laboratory and online experiments. The results show that auctions are more efficient than negotiations in terms of the process. Auctions led to greater gains for the buyers, whereas more balanced contracts were reached in negotiations. Suppliers’ assessment was affected by their outcomes, and the winning suppliers were more satisfied with the process, outcomes and system. The buyer’s role was also examined. Different types of information conveyed from buyer influence suppliers’ behavior in making bids/offers and concessions, which in turn affected buyer’s gains. In particular, the public information revealed in auctions increased the competition level and thus led to a greater number of bids and larger concessions. This then improved the buyer’s gains but resulted into imbalanced contracts. The two types of private information in negotiations showed different effects in the laboratory and online settings. The buyer’s messages led to reciprocal offers from the suppliers with larger concessions in the laboratory only, while the buyer’s offers had the same effect only in the online setting.