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E-Procurement

Paul R Schapper May 2009. E-Procurement. INTRODUCTION E-GP as a key component of Procurement Reform. Regulatory Control ≠ Good Governance. - RESPONSE - Minimise Discretion. - ISSUE - Vulnerability to Corruption. OUTCOME - Reduced transparency. - RESULT - Complex Regulations.

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E-Procurement

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  1. Paul R Schapper May 2009 E-Procurement

  2. INTRODUCTIONE-GP as a key component of Procurement Reform

  3. Regulatory Control ≠ Good Governance - RESPONSE - Minimise Discretion - ISSUE - Vulnerability to Corruption OUTCOME - Reduced transparency - RESULT - Complex Regulations

  4. Technology gives Transparency + Control E-GP Reform Control Information Processing & Reporting Automation of basic processes Transparency Activity Tracking and Monitoring Standardised Procedures & Documents Control + Transparency Control + Transparency Without technology transparency in procurement is problematic

  5. Countries Begin with Different Goals E-GP EFFECTIVENESS Efficiency Informed Management Value-for-money Quality Outcomes GOVERNANCE Transparency Accountability Integrity Public Confidence ECONOMIC DEVELOPMENT Business development Competitiveness Technological Enablement Market Access

  6. DEFINITIONCommon understanding of e-GP in general and in particular e-GP: just another IT system? How can electronic means be used to support public procurement systems including principles, objectives, legislation, and procedures? What are the basic differences between e-Tendering and e-Purchasing? e-GP and IFMIS

  7. What is e-GP? • E-GP is the application of technology to public procurement • An e-GP implementation strategy is a management and reform programme • E-GP is not a software programme but includes software • E-GP is not centralisation of procurement but requires centrally determined standards and procedures • It applies to the acquisition of works, goods and services. • Objectives include to improve governance and efficiency E-GP reduces the need for detailed and complex regulation to prescribe all the procurement processes and allows greater focus on objectives and outcomes. Ir is the capacity to change the quality of governance that makes e-GP so significant and changes the regulatory needs

  8. MANDATED Basic Systems E-Tendering Information & reporting system Very different systems E-Purchasing Management system also E-RA E-Management – Works & Supply Chain Online Contract Management

  9. MANDATED Online Tender Service - LHF • Transparent and open • Audit trails, access logs • Promotes competition • Downloads tender documents and drawings • Uploads documents and drawings • Request a hardcopy • Search facilities • Early tender advice • Electronic lodgment • Tenders Seek facility • Pending Award, tracking • Awarded contract information • Archived contracts • Industry e-activation STATISTICS Cost to develop $US500,000 Time to develop v2 3-9 months Firms registered 25,000 Tenders 100 / day Staff required 4 Electronic downloads 70% ETL 50% Access rate 2000 / day User charges $0.0

  10. Business Value Added Services Governments Businesses Departments High Value, Low Volume Procurement (E-TENDERS) Policies & Legislation Business A Department A Tender Advertising Department B Business B Queries & Advice Email Alerts Business C Department C Electronic Tender Lodgement Low Value, High Volume Procurement (E-PURCHASING) Department D Business D Catalogues Registries Department E Business E Government Electronic Market Department F Business F Contract E-Management Web Based Contract Management Contract Development Department G Business G e-Procurement StrategyStandardised Portal

  11. CHALLENGES Key success factors of e-GP implementationRisks of e-GPSuggested roadmap

  12. Why are Standards Important? Mars Polar Lander Example: Five clients – five systems

  13. Can Technology Complicate Public Procurement? Buyers Spot Markets + Panel Contracts Framework Contracts Technology can liberate procurement from complex rules and processes and allow a focus on better outcomes Reverse Auctions Alliance Contracts Suppliers

  14. International Trends in Public Procurement e-Procurement and Procurement Methods Governance standards Framework Contracts Reverse Auctions Process Performance Decentralisation Regulatory conformance Warehouse supplies & logistics

  15. Who is in charge of managing the e-GP agenda? Indicators • A sound Strategy • Central site • Leadership strategy • Objectives driven • Procurement Project • International standards / open access • Needs driven Success Indicators • Weak strategy • Multiple sites • Devolved strategy • Technology driven • IT Project • Closed standards / closed access • Vendor driven Fail Indicators

  16. The Lessons Learnt • Vision and leadership - national • Small Business friendly • Management not technology • Get right expertise • Needs vs vendor driven • International standards based • Architecture • Small steps not big bang • Education and training are essential . WHAT IT TAKES TO DELIVER How should the use of electronic means be addressed in the procurement policy and legislation? How to activate buyers and suppliers and ensure connectivity? Applying technology to automate some existing processes is a waste of time and money

  17. Which Path? Where, when, and what to start with? • How to start? Where to start? • Lead Agency? • E-Tendering? • E-Reverse Auctions? • E-Contract Management? • E-Purchasing? • Phased or Big Bang? • Timeframes? • Costs? • Security? • Policy Sovereignty? • FMIS? • Evaluation? Pre-qualification? • BOO? BOOT? SLA? • Legislation

  18. Tendering Execution Preparation Purchasing . E-Procurement & Automation China Canada Japan Argentina Bidding Processes Contract Management Development Selection Australia Bangladesh Brazil Armenia Hungary Indonesia

  19. External Stakeholders Portal Services Portal Services PMIS Data field Requirements Contract Management Workflow Management Electronic Document Construction BuyingRules Management Reporting Buyer Details & Authority Register Best Practice Guidelines Checklists Templates Case Studies Product/ Services Catalogue Contract Development Register Buyer Activity Profiles & Contract Management Registers Online Tender Box Account TransactionRegister ComplaintsRegister E-Payments Requests for Tender EOI requests Procurement Plans Publications including legislation Information Services Document Downloads Document Uploads Private sector Suppliers Banking services Payment gateway Related agencies LKPP Finance Audit E-Purchasing Framework Contracts Supplier Register Audit NGOs Civil Society Pre-Qualified Lists Supplier Activity Register Banking Institutions

  20. IMPACT EVALUATIONPerformance indicators

  21. PerformanceQualitative and Quantitative • Integrated with BP • User friendly • Cost recovery • Transparent • Take-up • Satisfaction – buyers • Satisfaction – suppliers • KPIs……

  22. Sample KPIs

  23. Paul R Schapper May 2009 E-Procurement

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