eprocurement in the world the real benefits from an international point of view
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1 eprocurement in the world the real benefits from an international point of view Christian Rupp, Austrian Federal Chancellery
2 Page 2
3 vertical architecture IT-Business Integration - ICT in public admin National State Districts Cities/ Communities Citizens/Entrepreneurs horizontal architecture Portals Page 3
4 KONEPS (Korea ON-line E-Procurement System) linkage of 77 external systems such as Ministry of Government and Home Affairs, financial institutions, and others In 2005 US$ 43 billion transacted 18 millions businesses participated in 141,000 biddings amounting to US$ 24 billion Other transactions of US$ 19 billion including private contracts were made electronically 91% of all biddings were conducted online 510,000 orders for items were delivered by one-click purchasing in the shopping mall - saved annual transaction costs of US$ 4.5 billion US$ 4.1 billion of business expenses was saved in terms of time and transportation (US$ 0.4 billion for public organizations) Per-capita productivity of PPS rose by 102%(from 208 to 421 cases annually) Ontology based e-catalogue service CRM and Web Call Center, RFID, mobile e-bidding and info service E-Procurement fora with the World Bank Central Asia (Kazakhstan, Azrbaijan, Armenia, Georgia) Southeast Asia (Thailand, Philippines, India, etc.) Latin America (Peru, Columbia, Panama, etc.) Page 4
5 Innovation EU VCD Open source reference implementations of components and building blocks for interoperability shall ensure awareness and acceptance on all levels across Europe Page 5
6 UN egov Survey Guatemala has well-organized e- procurement website linked directly from the national website as well as from most of the ministry websites. It provides information about the contracts and procurement system of the state, with comprehensive e- government features and services including registration with authentication and viewing of contracts awarded. It lists all opportunities for suppliers and products for buyers. The Ministry of Finance of Mongolia provides a portal for e-procurement where users can register for online bids, sort through different types of tenders, see upcoming tenders, and find out results of previous tenders. E- Procurement is available in the Mongolian and English languages. There is a newsletter and additional information regarding legislation, bidding and guidelines. Page 6
7 UN Public Service Award Indian e-procurement Market Place in the State Government - earlier, the Government of Andhra Pradesh s procurement process required a long chain of internal authorizations and scrutiny, several visits by suppliers to departments, and realms of paper-based statements and evaluations. A cabinet sub-committee on tender reforms created an e-procurement market place. The e-procurement systems thus established improved internal efficiency within the departments; shortened tender cycle times. European Commission recommendation was met by end of 2009 with the legislative amendments adopted by the Parliament of Albania. In 2009 public procurement via electronic means was applied 100% for the first time by all contracting authorities and for all types of public procurement procedures. Page 7
8 Lessons learned The aim of introducing e-procurement should not be only to deliver benefits and cost savings to a buying organization, but benefits and cost savings to suppliers as well. Supplier enablement is crucial. Simply put, an organization cannot maximize the potential benefits of an e-procurement solution if suppliers can t link to the system or decline to participate. All internal groups that will be affected by changing the procurement culture should be involved when implementing the solution (internal auditors). Streamlining processes before the solution is implemented, or as part of the implementation, will maximize value. Page 8
9 Lessons learned E-Procurement is not an IT project and cannot be run as such. It s about changing the business culture of organizations, then locking the changes into place. So, the prefix e is misleading. Successful procurement change requires strong, senior leadership and proper resources within organizations. Effective procurement rests on managing and developing relationships between buyers and suppliers. The same is true in e-procurement. Governments can legitimately offer for-profit initiatives if they aim to improve services. Such initiatives can result in more efficient delivery of services and reduced costs. Governments at all levels must align their laws and regulations to profit from efficiencies of scale (e.g., municipal governments sharing a single procurement system). Legislative action can make for-profit public-sector initiatives attractive to investment from the private sector, including foreignowned enterprises. Creativity and innovation can help solve problems caused by limited public budgets. Page 9
10 Thank you Merci - Dankeschön Christian.Rupp@bka.gv.at Page 10
11 eprocurement without borders in Europe Page 11
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