14 e procuement

7/29/2019 14 E Procuement

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E-ProcurementP. FRASER JOHNSON AND ROBERT D.KLASSEN


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- rocuremen

is the business-to-business orbusiness-to-consumerorbusiness-to-governmentsale of supplies, work, and services through the Internet as well as other infornetworking systems, such as electronic data interchange and enterprise reso

E-technologies and their applications within the supply chain

including usmanufacturers and retailersrange from the simple automation of long-stapractices to complex networked real-time linkages.

One specific areae-procurement remains critical to building and maincompetitiveness for manufacturing and service firms.

Efficiencies would be-

1. improved and procurement costs reduced;

2. the flow of information along the supply chain enhanced

3. strategic partnerships between networks of firms deepened
http://en.wikipedia.org/wiki/Business-to-businesshttp://en.wikipedia.org/wiki/Business-to-consumerhttp://en.wikipedia.org/wiki/Business-to-governmenthttp://en.wikipedia.org/wiki/Good_(accounting)http://en.wikipedia.org/wiki/Constructionhttp://en.wikipedia.org/wiki/Service_(economics)http://en.wikipedia.org/wiki/Internethttp://en.wikipedia.org/wiki/Electronic_data_interchangehttp://en.wikipedia.org/wiki/Enterprise_resource_planninghttp://en.wikipedia.org/wiki/Enterprise_resource_planninghttp://en.wikipedia.org/wiki/Electronic_data_interchangehttp://en.wikipedia.org/wiki/Internethttp://en.wikipedia.org/wiki/Service_(economics)http://en.wikipedia.org/wiki/Constructionhttp://en.wikipedia.org/wiki/Good_(accounting)http://en.wikipedia.org/wiki/Business-to-governmenthttp://en.wikipedia.org/wiki/Business-to-governmenthttp://en.wikipedia.org/wiki/Business-to-governmenthttp://en.wikipedia.org/wiki/Business-to-governmenthttp://en.wikipedia.org/wiki/Business-to-governmenthttp://en.wikipedia.org/wiki/Business-to-consumerhttp://en.wikipedia.org/wiki/Business-to-consumerhttp://en.wikipedia.org/wiki/Business-to-consumerhttp://en.wikipedia.org/wiki/Business-to-consumerhttp://en.wikipedia.org/wiki/Business-to-consumerhttp://en.wikipedia.org/wiki/Business-to-businesshttp://en.wikipedia.org/wiki/Business-to-businesshttp://en.wikipedia.org/wiki/Business-to-businesshttp://en.wikipedia.org/wiki/Business-to-businesshttp://en.wikipedia.org/wiki/Business-to-business


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E-Procurement compasses of-

E-Sourcing.

E-Coordination.

E-Communities.

E-Sourcing-

E-sourcing includes forward and reverse electronic auctions and online biddwhich are also referred to as electronic requests for quotations or proposals

In particular, electronic reverse auctions, in which online sellers compete to

a single buyer at the lowest possible price, have attracted a great deal of re


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Benefits of E-sourcing.

Potential benefits of reverseauctions include reducing directcosts, clearly establishing marketprices, shortening cycle timesand expanding reach, price

visibility and market knowledge.

Particularly when potenexperience low-capaci

online reverse auctions useful way to set price asatisfactory supplier per

Several key factors support the successful

adoption of reverse auctions-Clear commodity specifications; largepurchase lots sufficient to justifyinvolvement by a number of suppliers;appropriate supply market conditions;and an existing organizationalinfrastructure

Most important precondia successful reverse auctinvesting time in the prepto understand clearly thesituation in the supply maconducting the auction


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E-Coordination.

E-coordination technologies automate business processes, both within the obetween a purchaser and existing suppliers.

Examples include electronic purchase-order systems, online catalogues andwith suppliers to exchange information regarding fulfil-ment activities.

Divers for E-Coordination-

Outdated information technology systems,

Competitive pressures to reduce cost

Dissatisfaction with the performance of the supply function by other membe

organization.


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Five-stage implementation sequence:

analysis and segmentation of spending

Redesign of process.

use of multiple technologies to support new process.

supply-base rationalization and reduction.

electronic payments to suppliers.


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Benefits of E-Coordination.

cost savings from process improvements and price reductions.

greater visibility of orders.

improved supplier competition.

Fewer requests for proposals that elicit no bids from suppliers.


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E-Communities. An e-Procurement community is defined as a group of

organisations (buyers, suppliers) which use the same IT

a common set of electronic procedures for all aspects

procurement process.

E-community Models-

1. public e-marketplaces.

2. industry-sponsored e-marketplaces.

3. private exchanges.


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E-marketplaceadoption was greaterfor larger firms and

whenever managersperceived greaterexternal competitivepressure.

Industry-sponsored e-maappear suitable when theopportunity to leveragetechnology costs across

companies in an industrywhere cross-enterprisecollaboration is needed tthe benefits from redesigprocess,

private exchanges havecontinued their growth andmake sense where there isopportunity for competitiveadvantage or where there areno public- or industry-sponsorede-marketplaces


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Implications for Performance

e-coordination did indeed positively affect performance outcomes, while edid not.

There is not a single solution to successful implementation of e-procurement

found that the barriers to effective e-coordination are created by suppliers, firm itself.

Implementation must be designed to support the corporate goals and stratindividual firm.

For example, a low-cost corporate strategy may employ e-sourcing technol

low-cost sources of supply.


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THANK YOU

14 e procuement

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