chapter1&2 final deecember 3

8/9/2019 Chapter1&2 FINAL Deecember 3

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University of Perpetual Help System DALTACollege of Computer Studies

CHAPTER 1

The Problem and its Settings

1.1 Project Context

An Auction is a Latin word which means augment. Auction is a bid, a process

where selling, buying, and services offered take place. There are several types of auctions

and certain rules exist for each auction which may include minimum price limit,

maximum price limit and time limitations etc. depending upon the auction method biddercan participate remotely or in person. Remote auction includes participating through

telephone, mail, and internet.

Shopping online has widely grown. nline auction is becoming more and more

popular in electronic commerce. !ence its system must increase its "uality and security.

The online auction system is a model where we participate in a bid for products and

service. This auction is made easier by using online software which can regulate

processes involved. There are several different auction methods or types and one of the

most popular methods is #nglish Auction System. $t is designed to be highly%scalable and

capable of supporting large numbers of bidders in an active auction.

nline Auctioning System has several other names such as e%Auctions, electronic

auction etc. The re"uirement for online auction or online bidding can be more accurately

specified by the client. $t should be healthy and will be a good practice when it is made

more transparent as a matter of fact.

nline &idding has become more wide spread in all sorts of industrial usage. $t

does not only include the product or goods to be sold. $t also has services which can be

provided. 'ue to their low cost this expansion made the system to grow.

ONLN! "DDN# S$ST!% &O' ON! CO%%!'C!


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A Re"uest for uotation is a re"uest that a company puts out when they want to

hire contractors to perform a 2ob. The R3 is basically their way of encouraging

contractors to bid against each other. The company that issues an R3 then selects one of

the bidders to take the 2ob.

A Re"uest for $nformation 4R3$5 is a proposal re"uested from a potential seller or

a service provider to determine what products and services are potentially available in the

marketplace to meet a buyer)s needs and to know the capability of a seller in terms of

offerings and strengths of the seller.

1.! "bjecti#es o$ the Stud%

6.7.6 8eneral ob2ective

The general ob2ective of the pro2ect is to develop an online bidding system for

ne ommerce with a basic Re"uest for $nformation, Re"uest for -roposal and Re"uest

for uotation9 and to increase the knowledge on how procurement system works where it

is needed to be used and serves as a backbone of the online bidding system.

6.7./ Specific ob2ectives

This study aims0

to develop a webpage containing complete reports on each elements system

4Re"uest for $nformation , Re"uest for -roposal and Re"uest for uotation59

to develop a system that will help the customer to bid more precisely and more

secured9

to earn necessary information on how procurement data are established9 and

to establish a concrete knowledge about procurement system that will be used in

making the online bidding system.



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1.& Scope and 'imitations o$ the Stud%

6.:.6 Scope

#nd to end system 4Re"uest for $nformation , Re"uest for -roposal and Re"uest

for uotation5

&idding structure of the system

'ata process on how the nline &idding supposed to work

Relation between system integrators and client or suppliers.

6.;./ Limitation

nly allowed to $.T, Telco, #lectrical, #lectronics, and Software Staffs

ash or payment transactions will be done manually by the company Staffs

There will be no online communication or chat context. All of the conversation

will be held through phone calls that will be answered by the assigned staff.



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CHAPTER 2

Re#ie( o$ Related 'iterature and Studies

3or further understanding of the study, the researchers made use of different

reading materials related to the online system. These materials such as books, maga1ines,

newspapers, thesis, and other web articles are essential in broadening the knowledge of

the researchers. These will also guide the researchers to achieve their ob2ectives by

getting ideas on other related studies and make improvements as possible.

The information gathered by the researchers focuses on the development ofnline &idding or -rocurement system and its advantages to the economy, consumers

and businesses. Security measurement information in terms of payment and customer


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2.1 Related 'iterature

This review consists of books, articles, and documents that focus on the same

sub2ect matter or other concepts of the study.

)oreign 'iterature

"nline *idding S%stem+Aesti#a Procurement S%stem+S%stem ,1

Automating a procurement process re"uires procurement software. -rocurement

processes vary. They can include purchase order management processes, receiving,

invoicing, R3 +anagement, and more.

At Aestiva, we use the termprocurement softwareto indicate software that also

manages multi%supplier purchase re"uests. These situations re"uire software tools to split

the purchase re"uests into two or more re"uisitions. An Aestiva -rocurement Software

system, like our -urchase rder systems, can be expanded with the modules you need. A

-rocurement Software system is not really a single product. $t is a family of products that

constitute a system. A -rocurement Software system can stand%alone or be integratedwith an #R- system, for example. $t can be single%currency or multi%currency, single%

language or multi%language. -rocurement systems can be set up for manufacturing or

government agencies for banks or retail chains. They can be installed on your own

e"uipment or cloud.



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"nline *idding S%stem+ex*id Procurement S%stem+S%stem ,2

e&id e=change is an integrated procurement system for supplier management, e%

sourcing, and contract management. !elp the procurement team by providing the

software tools for strategic sourcing to drive process efficiency and cost saving

throughout the organi1ation. The e&id e=change e%procurement platform is an easy%to%

use, affordable, and customi1able software%as%a%service solution used by large and small

businesses and government procurement organi1ations.

"nline *idding S%stem+SAP Supplier Relationship -anagement+ S%stem ,!

SA-has a product that allows a company to manage its relationship with its

vendors more successfully. The SA- Supplier Relationship +anagement 4SR+5

application can connect a company with its supply base which allows multiple levels of

suppliers, partners, and manufacturers to work together while you reduce the cost of

goods sold. There is a number of functions that are found in the SA- SR+ application

including procure to pay, catalog management, and supplier evaluation.

Procure to Pa%

This function is used to enforce procure to pay best practices that will reduce

procurement costs. This is achieved by improving supplier communications, streamlining

procurement operations, and improving cost management. $n this function it is possible to

cut process costs and speed cycle times by automating procurement and leveraging

workflow. >ou can also improve supplier relationship by assisting electronic transactions

and collaboration. ompanies can use the procure to pay data to create strategies with

vendors.

http://logistics.about.com/od/supplychainsoftware/a/Sap-Sales-And-Distribution.htmhttp://logistics.about.com/od/supplychainsoftware/a/Sap-Sales-And-Distribution.htm


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Catalog -anagement

This function is used to manage the catalogs that are supplied by vendors and

used by the company)s staff to purchase items. The catalog data has to be synchroni1ed

with the SA- master data and the data should be checked for "uality to ensure that it is

correct for users. The catalog data should be maintained so that the data can be cleansed,

loaded, aggregated, and put in a position where the data can be searchable. The catalog

function in SA- SR+ also provides companies with the ability to add images to the

catalogs they use as well as internet and print publishing.

"perational Sourcing

This function allows a company to look across the enterprise to gain visibility

even when a company is using a variety of purchasing solutions. The functionality gives

the purchasing department a view of the demand for goods across the company, even

non%SA-applications so that they can combine the total expenses and improve the

negotiation process with vendors. The purchasing department can work with the data in

the application to co%operate with vendors to improve overall savings.

Contract -anagement

entrali1ed contracts with vendors allow a company to use their total expenses

across a number of locations to help negotiate better prices. The SA- SR+ application

gives a purchasing department the tools to track the money spent and ensure that

employees are purchasing the correct items for the prices negotiated with the vendor.

Sel$ Ser#ice Procurement

This functionality gives employees of a company the opportunity to purchase

items they need from vendors via an internet portal. This allows employees who do not

normally purchase items, to be able to purchase items through the catalogs that are

http://logistics.about.com/od/supplychainsoftware/a/SAP.htmhttp://logistics.about.com/od/supplychainsoftware/a/SAP.htm


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available to them. &y developing a set of business rules for the employees, they can

purchase items which can trigger an approval workflow so the items are received in a

timely fashion.

Reporting

The SA- SR+ application contains operational reporting that allows a company

to monitor purchasing activities, measure contract compliance, and review organi1ation

wide spending and sourcing needs. The reports can use data from the SA- SR+ and SA-

#R- systems.

Current Release

The current release of the SA- Supplier Relationship +anagement is version ?.@,

which was released in /@@. The first SA-e%procurement solution was offered in 6,

and over the years, the solution has grown from a Beb%based catalog re"uisitioning

solution aimed at operational excellence to the solution today that offers complete supply

management. SA- SR+ is based on a number of best practices that come from provenbusiness and industry expertise. $t also provides a wide range of pre%configured business

scenarios that companies can "uickly implement and benefit from with improved

efficiency in their business processes.

"nline *idding+ Coupa ProcurementS%stem + S%stem ,&

oupa


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-urchase re"uisitions0 (sers can re"uisition anyitem from anysupplier, and put it

through your purchasing process for approval. -urchase order software0 i&uy lets buyers

place and manage purchases from any ecommerce site. Real%timebudgeting application,

so you


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slowly and painfully onwards to an eventual but unsatisfying conclusion. $t


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Togetherness is a word not often attributed to procurement, but =changing


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cost. A good procurement process should also be delivered efficiently to limit the time

and expense for the parties involved.

-rocurement is also a ma2or activity in government. $n the -hilippines, hundreds

of billions of pesos is spent by the government to buy goods and services to operate thebureaucracy, carry out pro2ects, and deliver services to its citi1ens. The Borld &ank, a

development partner, cites that for the past four years, an average of -6/6 billion worth

of infrastructure, e"uipment, materials, supplies, and services pass through government

procurement processes each year which accounts for 6;H of the country


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'evelopment Agency 4$'A5 as a common portal for registration of suppliers and

advertisement of bid opportunities.

The passage of the 8overnment -rocurement Reform Act in /@@7 further boostedthe importance of -hil8#-S. This law set forth the rules and regulations for government

procurement transactions as guided by the principles of transparency, competitiveness,

streamlined procurement processes, accountability, and public monitoring. $t re"uired allgovernment re"uirements from goods and consulting services to civil works to be

centrally posted through an internet infrastructure which will be called the -hilippine

8overnment #lectronic -rocurement System 4-hil8#-S5.

Bith the implementation of RA 6C:, all *ational 8overnment Agencies 4*8As5,

8overnment wned and ontrolled orporations 48s5, 8overnment 3inancial

$nstitutions 483$s5, State (niversities and olleges 4S(S5 including Local 8overnment

(nits 4L8(s5 are mandated to use the -hil8#-S. Suppliers, manufacturers, contractors

and consultants are also re"uired to register as well. Through the use of the -hil8#-S,

transparency in government procurement is enhanced since opportunities to trade with

government and the ensuing transactions are provided online. $nformation on changes in

terms of references, bid schedules, and the winning bidder and contract amount are all

accessible through the system. $n addition, the electronic catalogue, which providesinformation on pre%approved cost of commonly used items, will help government

auditors check whether the supplies purchased by a government agency are not grossly

over%priced. &efore the enactment of RA 6C:, bid opportunities costing /+ and above

for goods and consulting services and ;+ and above for civil works should be advertised

twice on two newspapers of general circulation. Bith the new law, opportunities are now

re"uired to be advertised only once in a newspaper of general circulation and posted

continuously in the -hil8#-S for seven calendar days. As a result, the government has

been able to save almost -hp I@@ million in newspaper advertisement expenses alone as

of June /@6@.



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As of September 6;, /@6@, the -hil8#-S hosted bid opportunities posted by

66,6:? government agencies and accessed by :;,;; goods and services providers. ver

6,@C@,@@@ bid notices have been posted by various procuring entities in the system.

lobe Telecom e4*id S%stem

The $nternet has provided uni"ue opportunities for 8lobe Telecom to interact with

its suppliers and partners as closely as if they were a single entity. Termed as the Knew

economyK, the company is enhancing its procurement approach and infrastructure in

order to maximi1e the benefits that can be derived in participating in this collaborative

environment.

8lobe)s e%Sourcing -ortal was developed in order to provide our partners an

effective means of 2oining in an KecosystemK that simplifies the procurement processes.

ur vision is to build an environment that promotes stronger business relationship by

utili1ing the advancement in communication technology and enterprise mobility. Truly,

this is e%ommerce in action.

-EC 5ET6"R7 S"'8T"5

They have a wide array of global brands and $T products that uses our

distribution services as to reach the intended market. !ere, they are parked under their

respective technologies. These products under their respective technologies are what

makes up the salient components of every business< $T infrastructure. As a alue Added



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'istributor in the $T industry, they provide their business partners and end clients with

various pre%sales $T services in the fields of wired and wireless data, voice and video

network design $T services, demo facilities, solution proofs of concept, reference

systems and network value engineering design services. These services are $S @@60

/@@C, $T$L and '*& ertified to help feel more at ease when dealing with them. +#

have been in the industry since 6; with their still expanding worth of networks to help

company choose products in the $T, $T industry.

2.2 Related Studies

This section consists of information gathered from thesis and dissertations which

are also relevant to the research.

)oreign Studies

Procurement Procedures 8nder the Pri#ate )inance nitiati#e9 The

"peration o$ the 5e( 'egal )rame(or:

(Dr. Richard Craven, Supervised by Professor Sue Arrowsmith and

Professor David Fraser, 2!2"

Richard


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practice9 perceived problems, including any legal uncertainty and constraints on best

practice9 strategies to conduct the process within the constraints9 and the factors that

influence compliance and approach to legal risk.

The mpact o$ the EC Procurement Rules on Corporate Responsibilit% in the

Suppl% Chain9 a Stud% o$ 8tilities

(#y Dr. $%eanor Aspey, Supervised by Professor Sue Arrowsmith and

Professor David Fraser and Frances Darton of Achi%%es &nformation 'td,

2!!"

'r. #leanor)s thesis examines the effect of the # procurement legislation on theimplementation of corporate social responsibility policies by the (M utilities. The

thesis aims to discover any problems and uncertainties in the area of orporate

Responsibility in the Supply hain within utilities caused by the # rules, any positive

benefits of the rules on designing corporate social responsibility policies, and the

response of the utility sector in practice. The thesis involves legal analysis of the relevant

# rules and empirical research, interviewing those responsible for implementing SR

policies in a sample of (M utilities. !er research was funded by the #SR and Achilles

$nformation Ltd.

Public Procurement and Tied Aid in the European 8nion9 A Critical Anal%sis

o$ the 'egal )rame(or:



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(#y Dr. Annamaria 'a Chimia, Supervised by Professor Sue Arrowsmith,

2"

'r. Annamaria La himia)s thesis provides a critical examination of the legality of

practice of tied aid in the #( +ember States, under regional and international trade rules.

$t focuses on the "uestion of the compatibility of tied aid practices with # rules and

principles and with the international legal instruments relevant for the #(, such as the

BT Agreements.

The thesis is based on the premise that tying of aid is a problem that needs to be

addressed, and the analysis elucidates the legal tools to help address the problem by

identifying the legal rules that are relevant, by considering how they apply to tied aid, and

by highlighting where amendments may be needed to limit the practice of tied aid by

using legally binding international and regional instruments. Two #uropean countries are

taken as examples in order to provide a practical illustration of the real world scenarios

where the law must deal with, namely $taly and (nited Mingdom.

*u%ers; Sellers and *ids The tendering -ar:et in Public Procurement

(#y )enri* Stensson+ niversity essay from #%e*in-e e*nis*a

)/-s*o%a0&nst. f/r industrie%% e*onomi, &$1 2!34"

This thesis studies the function of the tendering market in public procurement.

The effects of the characteristics of buyers, sellers, and bids in the tendering market are

analy1ed. A dataset of construction tenders in the county of Malmar, Sweden is analy1ed

by using regression analysis. Several findings are made about how characteristics of si1e,level of organi1ational knowledge, and location of buyers and sellers affect the

functioning of the tendering market in public procurement. The market for public tenders

is part of the public procurement market which is described in the thesis from a #uropean

and Swedish perspective.

http://www.nottingham.ac.uk/law/staff-lookup/annamaria.lachimiahttp://www.essays.se/about/Henrik+Stensson/http://www.nottingham.ac.uk/law/staff-lookup/annamaria.lachimiahttp://www.essays.se/about/Henrik+Stensson/


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The roles of public procurement authorities and of the supplying firms in this

market are described and the interactions of these players are analy1ed. Tenderinginvolves an auction procedure and the thesis treats some aspects of auction theory. The

sub2ect of the thesis to study the functioning of the public procurement market based on

the characteristics of the players within it is a new approach, but the characteristics that

are studied in the thesis and their effects on the behavior of the participant in the public

procurement market have all to some extent been described in the literature. A short

presentation of the main findings of the analysis0

The location of a firm here, meaning the site of its head"uarter, has an

influence on the fre"uency with which the firm is bidding. The effect is a small

positive correlation between the firm being local 4in the place where the contract

of the tender is to be carried out5 and its participation in tender. The organi1ational

knowledge of a firm is positively correlated with the fre"uency with which it

submits bids in public tenders. The more organi1ational knowledge there is in the

buying public entity, the smaller will the price variation be in the bids submittedin a tender.



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There is a negative relationship between the si1e of the tender and the

variation in price among the bids received. &eing a local firm slightly increases

the chance of winning a tender. The study gives an indication that the studying of

the described characteristics have effects on the behavior of the participants in the

market and it opens for further research in the area.

Assessment o$ E$$ecti#eness o$ Public Procurement Process9 The Case Stud% o$

-inistr% o$ )inance and Economic A$$airs n Tan


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study in the +inistry of 3inance and #conomic Affairs of Tan1ania. This study has

targeted interviews and observation which have shown there are ineffective of the public

procurement process. These are in2ected by the public procurement Act *o. /6 of /@@:

and others are caused by inade"uate budget to pay suppliers on time, limitation of skills,

and knowledge to the ministerial staffs and -+( staffs.

3urthermore, researchers have recommended that there is a need to amend the

public procurement Act *o. /6 of /@@: and accommodate some key points that will

enhance efficiency and effectiveness of the procurement process which will increase

revenue collection and emphasi1ing training of user -+( staffs. !owever, this Act is not

panacea E solution to everything but it must be dynamic to accommodate new issues as it

will be raised new techni"ues and principles that will ensure accountability and efficiency

on procurement.

'ocal Studies

epartment o$ Heath Customi


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procurement reform activists and a core group of highly competent and honest

professionals and support staff.

The procurement reform is an essential component of our health sector reform

agenda. The 8overnment -rocurement Reform Act or Republic Act 6C: of /@@7 and its

$mplementing Rules and Regulations give us a legal basis for conducting our

procurements. $n addition, the 8overnment -rocurement -olicy &oard wherein the

'epartment is an active member has been issuing standard bid documents and forms,

various resolutions, circulars, opinions, and generic manuals to support compliance,

facilitate the procurement processes and make it more efficient and effective. Bith the

variations in procurement practices in each of the '! procuring entities and specialre"uirements of health goods, services and works, the generic procurement manuals

have been customi1ed to minimi1e variations and ensure that all concerned follow the

procurement law and related laws. 3or your reference and guidance are the four 4:5

customi1ed volumes0 olume $0 8uidelines on the #stablishment of -rocurement

Systems and rgani1ations9 olume $$0 8uidelines on the -rocurement 8oods9 olume

$$$0 8uidelines on the -rocurement of ivil Borks and olume $0 8uidelines on the

-rocurement of onsulting Services. Bith these, we hope to improve the efficiency and

effectiveness of our procurement systems, practices and processes.

(#y$nri7ue . 8na 5D."

Procurement o$ Consulting Ser#ices

These -hilippine &idding 'ocuments 4-&'s5 for the procurement of onsulting

Services through ompetitive &idding have been prepared by the 8overnment of the

-hilippines 48-5 to be used by all branches, agencies, departments, bureaus, offices, or

instrumentalities of the 8overnment, including government%owned andDor Econtrolled

corporations 48s5, government financial institutions 483$s5, state universities and

colleges 4S(s5, and local government units 4L8(s5. The procedures and practices

presented in this document have been developed through broad experience, and are for

mandatory use in pro2ects that are financed in whole or in part by the 8-, Borld &ank,



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or any foreign governmentDforeign or international financing institution in accordance

with the provisions of the $mplementing Rules and Regulations 4$RR5 of Republic Act

6C: 4R.A.6C:5.

The bidding documents shall clearly and ade"uately define, among others0 4a5 the

ob2ectives, scope, and expected outputs andDor results of the proposed contract9 4b5 the

minimum eligibility re"uirements of bidders, such as track record to be determined by the

!ead of the -rocuring #ntity9 4c5 the expected contract duration, delivery schedule andDor

time frame9 and 4d5 the obligations, duties, andDor functions of the winning bidder.

4he Phi%ippine #iddin- Documents, 6overnment of the Phi%ippines"

Transparenc% and Accountabilit% 5et(or: procurement monitoring

n January /@@7, it passed the RA6C: E 8overnment -rocurement Reform

Act provided for *8 observers to the procurement process. The procurement

monitoring is based on 8overnment -rocurement Reform Act 4RA 6C:5 and other

related 8--& issuances and it covers monitoring of competitive bidding, and alternative

modes of procurement. bservers report also provides guide on determining red flags and

utili1es documents such as Annual -rocurement -lan or -rocurement List 4including

Supplemental -rocurement5, $tems to &id, &id Results on ivil Borks, and 8oods and

Services, Abstract of &ids as alculated, etc.

(9incent . 'a:atin 2;


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nput Process "utput

P" -odel

P"


A system application

that will improve

bidding or auctioning

method with the help

of the procurementprocess

3or #asy and efficient

service to all

7no(ledge Re=uirement

'atabase +anagement

-!-

So$t(are Re=uirement

+icrosoft isual Studio /@6@

+ySL

Adobe -hotoshop S;

Adobe $llustrator$nternet Beb &rowser

perating System

S%stem Anal%sis > esign

(ser $nterface

'ata 3low +odel

#ntity #vent +odel

Testing >Re#isions

'ebugging

(nit testing

-roduct testing

$ntegration testing

Acceptance testing

#nd%to%end testing

Hard(are Re=uirement

omputer Set with

$nternet onnection

nline &idding

System 3or ne

ommerce


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This chapter explains the conceptual model of a general system. $t is a table that

shows a program


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The last stage is the output. $t is the result of the processing based on inputs and

process identified during the actions taken by the researchers through the system

development of the study.

2.& "perational e$inition o$ terms



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System E bounded transformation process, that is, a process or collection of processes

that transforms inputs into outputs. $t can comprise multiple views. 3or the man%made

systems it may be such views as planning, re"uirement4analysis5, design,

implementation, deployment, structure,behavior, input data, and output data views.

'ata E 'istinct pieces of information usuallyformattedin a special way

of instructionsfor manipulating data.

nline E Anything done using the internet or on the web

Transaction E Transfer of data from one personDcomputer with another.

#ncode E $nput data to the computer.

$nputDoutput % is the communication between information processingsystem 4such as a

computer5 and the outside world.

Re"uest for uotation E A way of encouraging contractors to bid against each other in

certain items or products.

Re"uest for $nformation E A kind of the data which comes from the potential seller or

service provider that can determine the availability of products or services in the

marketplace

Re"uest for -roposal E A process of including information


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M$'S E Mnowledge in 'ata System

$D E $nputDutput

S E isual Studio

SL E Structured uery Language

+S E +icrosoft

R3$% Re"uest for $nformation

R3% Re"uest for uotation

R3-% Re"uest for -roposal

S E ollege of omputer Studies

(-S!' E (niversity of -erpetual !elp System 'alta