E Procurement
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E-Procureme
ntBy: Nikhil Soni
– 91038 Mayank Sharma – 91031
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Procurement cycle starts from Raising of the requirements for an
item or a service and ends only after settlement of supplier
payments.
Traditional Procurement Cycle
Request Source Order Receive Pay
Analytics
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Traditional Procurement Process
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Time and effort wastage in seeking procurement information
Physical access barriers
Human interfaces – Low value addition
Non Transparent processes for suppliers
Possibility of data tampering and loss of records
Constraints
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• For IBM,– The acquisition of direct and indirect products and
services using the internet and new technologies to facilitate a seamless, end-to-end stream of strategic procurement activities by connecting buyers and suppliers.
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• For IBM,– The inclusion of tools and business
intelligence systems that enable improved responsiveness and analysis within the procurement organization.
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• For IBM,– The linkages between suppliers and internal
systems across the supply chain.
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Reduce Procurement Cycle Times
Increase Supplier Access• Ensure Wider Participation
Reduce Costs of procurement• Competitive Bidding
Remove cartelization• Reverse Auctioning
Increased visibility and transparency
Complete elimination of paperwork
Objectives
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E-Procurement’s Popularity Trends
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Topics for Discussion
1. • Web-Based ERP
2. • E-MRO
3.
• E-Sourcing / Reverse Auctioning
4. • E-Tendering
5. • E-Informing
6. • E-Marketsites
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Web-Based ERPCreating and approving purchasing requisitions, placing purchase orders and receiving goods and services by using a software
system based on Internet technology.
Product Vendors – SAP, Oracle, The SAGE Group
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Web-Based ERP
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Web-Based ERP
Eliminates Synchronization problems
Control of business process across functional boundaries
Reduced risk of loss of data
Shorten production lead time and delivery time
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E-MRO - Maintenance, Repair and Overhaul
The same as web-based ERP except that the goods and services
ordered are non-product related MRO supplies.
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E-SourcingIdentifying new suppliers for a specific category of
purchasing requirements using Internet technology.
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E-Sourcing Benefits
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Reverse AuctioningUsing Internet technology to buy goods and services
from a number of known or unknown suppliers.
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E-TenderingSending requests for information and prices to suppliers and receiving the responses of suppliers using Internet
technology.
Tender Preparation
Tender Publishing
Bidder Response
Bid Evaluation
Contract Award
IndentTo TenderRequest
e-Tendering Solution
An e-Tendering solution primarily facilitates the ‘Tendering Process’
and may cover from Indenting of Requirements to the placing of contract/PO
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E-TenderingBenefits to Buyers
Cost Reduction
New Supplier Discovery
Close Monitoring of Activities/ Vendor Performance
Rich MIS and Analytics
Standardized formats and Uniform tendering practices Benefits to Suppliers
Increased visibility/ Less artificial barriers
Increased business opportunities,
Greater degree of transparency
Cycle time reduction in participation and award of Contract
Supplier Enablement and Ease of Participation
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E-Tendering for CWG (Delhi Govt.)
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E-InformingGathering and distributing purchasing information both
from and to internal and external parties using Internet technology.
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E-Marketsites Expands on Web-based ERP to open up
value chains. Buying communities can perform the
following:Access preferred suppliers' products
and services Add to shopping carts
Create requisition Seek approval
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E-Procurement Cons
Electronic Errors in
PO
Some software do not meet
specific requirem
ents
Enabling suppliers
to support
e-transactions is a hassle
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IBM’s Supply Portal
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E-Procurement at Siemens
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Siemens – Click2Procure
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