e-procurnment 1

8/3/2019 e-procurnment 1

http://slidepdf.com/reader/full/e-procurnment-1 1/28

ACKNOWLEDGMENT

I am indebted to many persons for their help and contribution during

the preparation of this seminar. There are individuals who deserve specials

mention in this sector for their help.

First and foremost, I would like to thank Er. Akhtar Hussain (my

honorable guide) for his prodigious guidance, persuasion, painstaking

attitude, reformative and prudential suggestions throughout my seminar

work.

I am greatly thankful to all faculty members of computer engineering

department for instilling in me a sense of self-confidence and helping me as

and when I needed them. Finally, I am also thankful to my friends who have

directly or indirectly helped me during the preparation of this seminar.

Amit Kumar Shrivastava

Final Year

(Comp. Engg. & Info. Tech.)

M.I.T. Moradabad



CONTENTS

1. SYNOPSIS

2. WHAT IS E-PROCUREMENT

3. WHY E-PROCUREMENT

4. HOW E-PROCUREMENT WORK

5. MAJOR COMPONENTS OF AN E-PROCUREMENT SYSTEM

6. ADVANTAGE OF IMPLEMENTING E-PROCUREMENT

7. HOW E-PROCUREMENT POSITIVELY IMPACT MY BOTTOM

LINE

8. KEY FACTORS FOR E-PROCUREMENT SUCCESS

9. HOW TO CHOOSE AN E-PROCUREMENT PACKAGE

10.WHAT EXPERTISE ENSURE E-PROCUREMENT SUCCESS

11.SERVICE AND SUPPORT

12.TRAINING INFORMATION OVERVIEW

13.SUPPLIER INFORMATION

14.CONCLUSION

15.BIBLIOGRAPHY



SYNOPSIS

Computers are everywhere and business and industry are using them

in new ways. Some of the ways in which computers are integrated into

business have been discussed in the following report. These application are

cost and budgetary control, stoke control and sales, distribution, payroll and

personnel records, banking, insurance and stock broking, aid to management

and information system in business. The common applications tend to be

bookkeeping variety.

In the past, a large but manageable amount of bookkeeping was

handled manually, but such has been the expansion in various sectors that

use a huge labor force would be needed to tackle today’s massive volume of

bookkeeping. The computer is necessary because there is no other way of

dealing with the problem. In most instances, the computer is sited entirely;

branches are equipped with terminals giving them an on-line facility and

enable them to interrogate the central system for information. Company can

be benefited from the immediate availability of information, which the

computer provides. Thus if computers are evicted on this day, the entire

business and industry would come to a grinding halt.



CONCLUSION

To be successful in implementing an e-procurement solution and

realizing the maximum possible ROI, an enterprise must remember a single

principle: One solution.

• One solution to cover all of its procurement needs, from product

searching to payment

• One solution that can be configured to map to its organization

structure, eliminating the need for multiple systems supporting the

diverse needs of multiple lines of business

• One solution that can be extended to adapt to an enterprise’s particular

needs with utilities that make customizations standardized and

repeatable

• One solution that interoperates seamlessly with the world’s largestelectronic marketplace, the Global Trading Web

• One solution that currently has the largest global customer base of any

e-procurement application, spanning six continents

The one solution that can boast all of those claims is Commerce One some

of the largest companies in the world have selected Buy Site and Commerce

One as their e-procurement solution, including General Motors, BritishTelecom, Nippon Telephone and Telegraph, Warner Lambert, BellSouth,

Schlumberger, Pacific Gas and Electric, Singapore Telecom, Deutsche

Telecom, Bass Breweries, Columbia/HCA, Siemens, and Hilton.



BIBLIOGRAPHY

• Matter are collected from website http://www.ncgov.com/

• A Procurement Director’s Guide By:

Sue Hamilton

Jim Myron

Jeff LeechWebsite http://www.ejiva.com/

• Accelerating Global Electronic Procurement with Commerce One

Buy site 6.0 Enterprise Edition

Website http://www.commerceone.com/

• Matter from IFFCO Phulpur Allahabad

Website http://www.iffco.nic.in/



Entering the Dynamic New E-

procurement Marketplace

WHAT IS E-PROCUREMENT?

In simplest terms, electronic procurement defines the automation of an

organization’s procurement processes using web-based applications. Unlike

enterprise resource planning (ERP) systems that enable businesses to

automate their internal processes, e-procurement enables widely dispersed

buyers and suppliers to come together, interact, and execute purchasetransactions directly over the Internet.

In a fully web-enabled e-procurement system, each step in the

procurement process occurs electronically. From creating and submitting

POs to receiving and paying for goods—all transactional data is

automatically routed through workflow processors, reducing the time and

cost of procurement activities, and boosting operational efficiency of the e-enabled organization.

E-procurement applications consolidate the paper-based catalogs of

multiple vendors by digitizing product information into a single, one-stop

shopping source for direct and indirect goods and services. In most cases, e-

procurement applications are transparent to end-users. Embedded in the

business processes and IT systems of buyers and suppliers, e-procurement

applications lower process and inventory costs, extend supplier reach, and

improve customer access to suppliers.

Instead of flipping through a mountain of outdated supplier catalogs,

buyers can tap the powerful search capabilities of the Internet—to compare



up-to-date product information, determine availability, delivery options,

warranty, service, and other pertinent factors to make the most informed,

cost-effective purchases.

Bringing it all together. E-procurement links buyers and sellers in a dynamic virtual marketplace—a

thriving electronic village void of traditional barriers, where fundamental economics rules and

competition reigns supreme.

WHY E-PROCUREMENT?

The state is moving from a procurement environment that is paper-

based to an Internet-based environment, called electronic procurement, or e-

procurement. Transacting electronically can create significant administrative

cost savings for both buyers and suppliers, thereby allowing for price

savings as well. The transition to e-procurement has high-level support from

the Governor and executive sponsorship from the Department of

Administration Division of Purchase and Contract, the Office of the State

Controller, and the Office of Information Technology Services.

HOW E-PROCUREMENT WORKS

While there are many variations, the most common e-procurement

model involves a host or intermediary service provider linking buyers and

sellers in an interconnected supply chain using a web-based e-procurement



application. The host manages transactions, facilitates communication,

aggregates and maintains catalog content, and provides the general

infrastructure for the virtual marketplace.

The E-Procurement Service performs all procurement activitieselectronically; including requisitioning, purchase order transmission,

notification of electronic quotation requests and electronic quote response.

Through this network, buyers may compare products from multiple suppliers

in a single electronic catalog or check on an item’s price and availability in

real time before electronically creating a PO. Once a PO is approved—also

electronically—it’s sent to the supplier via the host’s Web portal.

This same Web portal enables suppliers to automatically return real

time PO status. After an order ships, buyers can process tracking and

receiving functions right from their workstations. Creating an invoice and

authorizing payment is handled electronically through the same portal as

well! Beyond merely automating shipping and receiving tasks, however, e-

procurement offers far more process improvements and innovative options

for streamlining business operations and maximizing strategic initiatives.

E-procurement enables access to global suppliers, real time

communication between buyers and suppliers, electronic payment of

invoices, and assignment of logistics freight rating and routing. E-

procurement has also spawned creative new business models such as

auctions for suppliers to sell excess inventory, reverse auctions where

suppliers bid to fulfill a buyer’s order, and trade exchanges where buyersand sellers simultaneously bid for each other’s business (see Table 1).



MAJOR COMPONENTS OF AN E-PROCUREMENT SYSTEM

Regardless of the e-procurement model, each has similar components

that must be properly considered and managed to ensure a successfulsystem. These include: catalog content, e-procurement processes, user

maintenance, establishing buyer/seller relationships, billing management,

price establishment, data transmission, and system maintenance .

Catalog Content

At the heart of every e-procurement process lays an electronic catalog.

Similar to a traditional mail-order catalog, electronic catalogs contain

detailed information on products or services available for sale. Suppliers

customize the content to address the specific needs of targeted buyers. This

content is manipulated and imported into a database that the e-procurement

application integrates into web pages.



The management of catalog data can be handled using import and

aggregation tools or by outsourcing the task to companies specializing in

content management.

Content providers generally offer the following services:• Convert catalog data into a uniform language and format

• Gather and aggregate data from multiple suppliers into one catalog

• Publish and maintain the product catalog

Once a catalog is created, various cataloging strategies are used to provide

access to the content. Strategies include using a centralized catalog model

where the aggregated data is hosted at a central location, a distributed modelwhere data resides at multiple sites, or a content-retrieval method where

suppliers present catalog data directly to buyers.

There are three types of catalogs that address various buyer needs:

Product catalogs: Contain data on tangible items such as office products,

medical supplies, rolls of steel, etc.

Service catalogs: Offer professional service “intangibles” such as office

maintenance services, temporary personnel services, etc.

Commodity-specific catalogs: Offer specific product families or groups

such as chemicals, paper, or other raw materials

E-procurement Processes

In addition to creating an electronic catalog, existing procurement

processes need to be “electrified” end-to-end to support the entire e-

procurement process. This includes requisition and order management, real-

time tracking and receiving, online order fulfillment, automatic billing,

invoicing and payment, as well as workflow management, commerce

transactions, and reporting and analysis tools.



Note that an effective e-procurement platform must support both the

buyer’s and the supplier’s business processes. It should also offer

functionality that can easily be customized and configured to meet specific

e-procurement requirements. In general, a successful e-procurement solutionwill be founded on an open, component-based model that offers easy

configure ability and scalability.

User Maintenance

Closely related to the two preceding process management components, user

maintenance includes defining the individuals authorized to use the e-

procurement system, how these users will be enrolled, and how to provide

them access to the trading community. This component serves as the

foundation for managing the complex buyer-supplier relationships that will

occur within the marketplace.

E-procurement user maintenance must address two primary tasks:

• Establish user profiles, access rules, catalog filters, and workflow

• Allow for unique pricing and contractual relationships between a

buyer and supplier

The following steps are vital to successful user management:

Creating the buyer organization: Identifying and defining the individual

buyers, how they will form buying groups, and how they will access the e-

procurement process

Creating the supplier organization: Identifying sellers, maintaining

company profiles, and creating shipping options and other high-level

parameters for supplier activities

E-procurement organization: Aggregating the entire marketplace,

including buyer and supplier, to include such things as hours of operation,

billing rates, etc.



Additionally, user maintenance requires establishing authorization levels and

associated procedures to precisely govern buyer and supplier capabilities.

Three authorization levels that must be addressed are:

Access to the electronic catalog: Defines who may access catalogs and howto do so

Creating and editing requisitions: Defines who can create requisitions,

who can edit requisitions, and who can edit accounting codes

Managing orders: Defines who has access to POs and who has

authorization to override shipping or billing information

Establishing Buyer/Seller Relationships

This component has two phases: managing supplier relationships and

managing pricing.

Buyers and sellers may be linked based on their previous buying relationship

or based on the buyer’s unique needs. Buyers may make purchases based on

negotiated contracts or choose the specific commodities they need from

customized catalogs.

Price lists too may be customized for a buyer or buying group. For example,

prices may be established by adding filters that dynamically calculate a price

as a markup or discount of the list price. Or groups of buyers may be

categorized into classes with filters applied for each group.

Billing Management

E-procurement revenues are generally based on transaction fees. A billing

management system will calculate usage charges and generate and distributestatements or invoices to buyer-seller members of the e-procurement

network. Suppliers may also use the billing system to calculate ordering

charges or to distribute operating costs for specific orders. These functions



must directly interface with back office invoicing systems to automatically

generate bills.

Price Establishment

Effective pricing enables buyers to negotiate the best possible deals andsellers to liquidate excess inventory. Two major pricing options are used:

Dynamic Pricing and Fixed Pricing.

Dynamic pricing: Allows buyers and sellers in an Internet market to trade

goods and services at prices determined by market forces instead of by a

predetermined price list or catalog.

An example of dynamic pricing includes business services such as auctions,

reverse auctions, and exchanges.

Fixed pricing: Based on a predetermined price list or catalog prices

negotiated between a buyer and seller

Data Transmission

Transmitting data over the Internet involves two facets: messaging agents

and security.

Data and messaging tools enable the Internet-based exchange of

transactional data between different buyers and suppliers in the e-

procurement marketplace. To do this, transactions are sent via the Internet as

“messages” and then integrated into a supplier or buyer’s back-office

system, enabling financial postings that coincide with the receipt, payment,

and invoicing processes. Data messaging tools are also used to cancel

transactions and log failures when messages can’t be delivered within a predefined time period or following a specified number of attempts. The

most important aspect of the messaging tool is that it enables real-time

communication between buyers and sellers.



Coincidentally, security is an important aspect of any Internet transaction.

Protecting a buyer’s confidential financial information and ensuring that

only designated buyers have access to supplier product information is

critical to ensuring confidence in any e-procurement system.System Management

Maintaining an e-procurement system involves configuring and monitoring

performance usage, average response time, transaction sources, and traffic

patterns. To maximize the benefits and strategic opportunities e-procurement

systems offer, this information should be used to analyze growth patterns,

session times, and ultimately to fine-tune the system’s performance to fit

specific market communities or technical environments.

Once an e-procurement system is up and running, it’s important to monitor

traffic and system security on a day-to-day basis. Inadequately designed

transaction engines can result in poor marketplace performance, lack of

scalability, breakdowns in security, and, ultimately, frustrated users.

ADVANTAGES OF IMPLEMENTING E-PROCUREMENT

To fully appreciate the merits of e-procurement, it helps to view them

in contrast to traditional purchasing processes. For example, consider the

plight of a sales representative who needs $100 worth of office supplies to

support a customer presentation.

The Old Way to Buy...

In a manual, non-e-enabled procurement environment, the purchasing process might typically be:

Product selection: The sales rep must search numerous vendor catalogs

without knowledge of which vendors offer discounts. Worst-case scenario:



The sales rep is in the field with no access to the company’s product

catalogs.

Check availability/prices: Calls may need to be made to the vendor to

confirm pricing, quantity, availability, etc.Create and approve requisition: A paper requisition with correct item

numbers and prices needs to be created and approved a process that often

takes up to 3 days or more.

Generate and approve PO: Once the requisition is approved, the

purchasing department splits the requisition into several purchase orders

because multiple vendors must supply the material requested.

Send PO to vendor: Purchase orders are eventually mailed or faxed to the

vendors.

Vendor confirmation: The vendors confirm receipt of the purchase orders

and promise delivery within three business days.

Typically, the promised delivery date ranges from 5-7 business days from

the time the requisition is initially filled out. In the interim, our enterprising

sales representative, knowing the delays and accompanying frustrations of

the company’s purchasing process, has decided to buy the items at a local

office supply superstore. This way, the rep acquires the necessary equipment

without delay and with a lot less effort. Unfortunately, the company’s cost

for paying retail price is much higher than necessary.

The E-enabled Way to Buy...

The benefits of e-procurement over manual purchasing are many andmultifaceted. For example:

Streamlined processes reduce transaction time: Buyers can search

electronic catalogs containing goods and services from multiple suppliers



and compare products and prices on-line. Real time communication allows

buyers to check current prices and quantities.

Suppliers can provide instant PO status.

Greater standardization of procurement processes: Electronic catalogs provide a standardized listing of items allowing for easier item comparison.

Business rules governing all users and all transactions can be built into the

application. Regardless of where they’re located, buyers can access catalogs

using a standard web browser.

Greater access to suppliers: Using virtual e-procurement portals, buyers

have access to suppliers around the globe, which translates into a wider

selection of goods and services.

Global operability: E-procurement applications can support multiple

languages and currencies, as well as international financing, taxation, and

shipping regulations.

Ease of configures ability and scalability: Web-based procurement

applications can be configured to meet the unique needs of buyers and

sellers and be scaled to grow as the organizations grow.

Building of trading communities: E-procurement allows the development

of both horizontal and vertical trading communities offering consolidated

buying power for the purchaser and increased range for new supply chains.

Lower costs: Cost efficiency results from a variety of factors including

reduced time between order creation and order fulfillment, greater selection

of goods and services from which to choose, formation of tradingcommunities to consolidate buying power, the opportunity to purchase

surplus products and services below market prices, and more!

Increased productivity: Automated procurement processes can yield

significant timesaving at all levels across an enterprise, increasing



opportunities for employees to focus on more strategically important tasks

and functions.

Increased opportunity to leverage preferred vendor relationships:

According to a leading e-procurement systems vendor, 80% of indirectgoods and services are purchased from vendors classified as “other.” This

results from the frustrations and time delays inherent in processing paper-

based purchases. This practice decreases the volume of purchases from

preferred vendors and consequently drives up costs.

HOW E-PROCUREMENT POSITIVELY IMPACTS MY BOTTOM

LINE?

E-procurement systems tend to drive down the prices of goods and

services in three ways:

Increased preferred vendor purchases: E-procurement fosters purchasing

from preferred vendors, who in turn offer volume discounts and contract

pricing. A typical e-procurement system can boost preferred vendor

transactions by 25%, returning substantial savings assuming a weighted

average preferred-vendor discount of 7%.

Preferred vendor consolidation: As volume shifts to preferred vendors,

low-volume vendors will eventually be eliminated from the supplier

network, driving more purchases to preferred vendors and enabling them to

increase consumer discounts.

Spot discounts: Because of the dynamic nature of on-line pricing, vendorscan offer limited-time spot discounts on excess inventory. Even a one-

percent reduction in purchasing expenses can yield significant savings for

large organizations.

The really BIG savings—Reduced labor time/reduced transaction costs



By far, the greatest e-procurement savings result from the combination of

less time required for the total purchasing cycle and the subsequent reduced

transaction costs. Together, these decreased transactional factors translate

into significant cost savings.Table 2 shows the approximate time it takes to complete each step in a

single corporate purchasing cycle, comparing manual or electronic data

interchange (EDI) purchases to e-procurement.

This Table demonstrates the dramatic, nearly fivefold reduction in time and

nearly 80% reduction in cost directly attributable to e-procurement.

Table 2—Time and Money:



E-procurement Offers Tremendous Opportunity to Save Both

Now project your own potential e-procurement benefit by multiplying the

Per Purchase Savings rate by the number of purchase orders your own

organization processes in a single year.Depending on the size of your enterprise, e-procurement savings could

amount to millions of dollars annually. For suppliers, e-procurement stands

to yield significant reductions in inventory holding times and safety stock

levels, and an overall reduction in the purchasing cycle—the time it takes

from ordering an item to receiving it.

KEY FACTORS FOR E-PROCUREMENT SUCCESS

While e-procurement offers many quantifiable benefits, it still poses

many issues that must be carefully considered before implementing a

specific solution. Effectively addressing these issues will help ensure both a

rapid and a complete implementation—one that will help your organization

realize all the benefits of e-procurement, including a lower initial system

investment and an increased return on your investment.

Consider these questions before you choose an e-procurement solution or

provider, and consider how your answers will help you minimize the risks

and maximize the rewards of your new system:

Is my organization ready for e-commerce?

Do you already have an e-commerce strategy? How will e-procurement

integrate into that strategy? If you don’t have an e-commerce strategy in place, how can you build one that will support e-procurement as well as all

future e-commerce activities?



How will I bring my suppliers on board?

E-procurement will change the buyer/seller relationship. How will your

current supplier relationships need to change to maximize the e-procurement

solution? What strategies must be developed to build and maintain thoserelationships?

How wills my current procurement processes need to change to

maximize e-procurement?

Is your business model aligned with your system model? Where are the gaps

and how can they be closed?

How can I create a scalable infrastructure that will support future

growth?

Industry studies indicate that e-procurement is poised for explosive growth.

Factors driving this growth include the number of buyers and suppliers

participating, increased accessibility to authorized users throughout an

organization, improvements in Internet e-commerce software, and

organizational growth. This translates into increased transaction volume that

can easily overwhelm the capacity of an e-procurement system.

Note that e-procurement software must be object-based to support the

addition of custom or third party applications, as well as easy integration

with your current back office systems, as the needs of your marketplace

change.

HOW TO CHOOSE AN E-PROCUREMENT PACKAGEWith the recent proliferation of proven, commercial e-procurement

applications, there’s no need to build your own. However, consider the

following factors when choosing your own solution:

• Does it support the full e-procurement cycle?



• Does the application take advantage of your organization’s current

Internet environment?

• Does the e-procurement application provide ease of configure ability

and scalability?• How secure is the data going across the Internet?

• Are catalog content-management services provided?

• How easily will the e-procurement solution integrate with your

existing back-office ERP or legacy systems?

• What support is provided to bring suppliers on board?

• Does system administration lend itself to adding and changing routine

system information on users, bill-to and ship-to addresses, cost centers

and organizational attributes, suppliers and related information?

• Does it support extended business services such as auctions, reverse

auctions, and exchanges?

• Does it support value-added services such as bill payment, logistics,

and taxation?• Will the vendor provide regular updates and software support?

WHAT EXPERTISE ENSURES E-PROCUREMENT SUCCESS?

Successful e-procurement implementation requires a number of

unique technical, functional, and project-management skills including:

•

Knowledge of the current e-commerce marketplace• Industry expertise in procurement practices

• E-procurement implementation expertise

• Experience integrating e-procurement packages with ERP and legacy

systems



• Strategies for supplier adoption and maintaining supplier relationships

• Experience in managing product catalog content

• Technical knowledge of web-based development tools and

networking architecture

SERVICE & SUPPORT

Online self-registration for new vendors and self-maintained vendor

registration functionality. Training will prepare suppliers to successfully

conduct electronic business and help suppliers to maximize the value of a

new online sales environment. Customer Service including e-mail and phonesupport will be available to help answer supplier questions.

TRAINING INFORMATION

The E-Procurement Project team is in the process of developing

materials to train the estimated 40,000 users that will eventually use the NC

E-Procurement Service. The sections below provide specific information

about the training process and will be updated frequently.

What is e-procurement training?

E-Procurement training will instruct employees from numerous agencies to

complete the following procurement processes using the Internet-based E-

Procurement Service:

o E-Requisition

o Requisition Approval

o Receiving

o Purchasing/e-Quote



Goal of Training

The overall goal of training is to prepare employees in agencies,

universities, community colleges, schools and other local governments to perform their procurement roles using the E-Procurement Service.

How is e-procurement training delivered?

Training Delivery Format

Users take only the courses they need to perform their roles. There

will be two types of training available:

o Web-based training (WBT)

o Instructor-led training (ILT)

The Web-based training will be available online over the Internet. It will

explain how the system works. Users learn how to use the E-Procurement

Service independently and at their own pace. Instructor-led training will be

given to users at government agencies in computer classrooms. Participants

will have "hands-on" exposure to the system while under the instruction of

their own agency’s trainer. Interactive exercises allow the user to practice

how to use the system . Instructor-led training will use a train-the-trainer

approach to train users at agencies that have the E-Procurement Service

integrated with their accounting system. Trainers will be nominated by the

project contact for each agency. Once trainers have been identified, they will

receive Train-the-Trainer training conducted by the e-procurement training

team.

Participants in instructor-led training courses will receive participant

guides. The guide will present processes and detailed steps so that it can be

used as a reference after training. Instructors will demonstrate steps in

walkthroughs while participants follow along on their computers and take



notes in their participant guides. Practice exercises reinforce skills after

every walkthrough.

Job aids (or laminated "cheat sheets") will also be developed for all

users to provide a quick reference tool when back on the job. Go to ILTMaterials You will need to enter a password to access the ILT Materials.

The password is the same as the one you used to access the WBT Login

screen for the first time.

Training Courses

Courses Topics Description

Overview and Navigation E-Procurement OverviewCourse Materials Overview

User Security

System Navigation

Personal Profile Settings

Search Functionality

Frequently Asked Training QuestionsIf I have to stop working on a WBT course before I complete it, do I have to

start the course over the next time I access the system?

No. The web-based training system automatically records where you

are in each course at the time you sign off. The next time you login, you can

begin right where you left off.

How do I access the system after training?

The E-Procurement project team will send each user e-mail with

instructions on how to access the system along with a User ID and password.

Web-based training shows how the system works and gives users an

opportunity to try it for themselves, at their own pace and as often as they



want. During instructor-led training, learners use the system, practice real

life scenarios, ask questions and receive coaching. Quick learners,

particularly those with good purchasing, computer and Internet skills, may

find that web-based training alone is sufficient. Most agencies, especiallythose with learners at middle and lower skill levels or those with needs for

high efficiency and accuracy, want to offer instructor-led courses in addition

to the web-based training.

How is e-procurement training delivered?

Should we take web-based training first?

Web-based training can be taken any time. The web-based training

teaches basic functionality and gives opportunities to practice as many times

as you want. Use it to familiarize yourself with the system before taking the

instructor-led course and use it later as a refresher. One great benefit to the

E-Procurement Service is that it is quick and easy to use. Most users will to

be able to complete their procurement tasks more efficiently and accurately

than previously. Training will help smooth the transition to the new system.

On the other hand, not everyone needs to be able to use the system

at once. In the beginning, you need to make sure that at least a couple of

people at each site can use the system not everyone at that site. For

Instructor-Led Training, will there be one session for each agency during the

two-week period, or will there be multiple sessions for each agency during

that period? The instructor-led Train-the-Trainer training is for the agency

trainers to learn how to deliver training to the end-users at their agency.Most agencies will have 2 trainers who can sign up together if they want.

Trainers may take all the e-procurement instructor-led courses:

eRequisitions, eQuote, Approval, and Receiving. The schedule starts with



the large agencies that have more trainers to be trained and who will require

more time to roll out training to their end-users.

SUPPLIER INFORMATION

What Does It Cost?Suppliers will be charged a 1.75% marketing fee for purchase orders for

goods issued through the E-Procurement Service. Services are exempt at this

time. This marketing fee percentage is consistent with other states, and there

are no up-front registration or annual subscription fees. The marketing fee

covers the cost for the development and ongoing operations of the E-

Procurement Service, including: Customer Service and Support for Both

Buyers and Suppliers Online Training, Catalog Services, Software and

Hosting

The marketing fee will be invoiced monthly based on purchase orders issued

through the E-Procurement Service during the prior month. For more

information on the marketing fee, please see the Fee Matrix.

1. Why is the State moving to electronic procurement?

It provides both its buyers and suppliers a more efficient, cost effective

method for conducting procurement. All suppliers will need to register with

the E-Procurement Service to continue receiving purchase orders from the

State. Wherever possible current vendor information is being retained so that

most suppliers will only have to confirm their information rather than

starting from scratch. However, some new information will need to be

captured, most notably being the method for receiving electronic purchaseorders in the future.

2. What types of purchases are included?



Purchase orders for both goods and services will be produced through the E-

Procurement Service; however, initially the marketing fee is only applied to

purchases of goods.

3. How does this affect me?

Suppliers fit into three different categories within this process:

1) Term contract suppliers,

2) Suppliers participating in eQuote (informal bidding process),

3) All other suppliers.

Term contract suppliers will have electronic catalogs built and loaded onto

the system. Suppliers participating in eQuote will receive and respond to

requests for quotes by logging into the system. If you don’t fall into either of

these categories, the only change will be that you will now receive purchase

orders with a consistent format through electronic means (e-mail or fax).

You will also now have the ability to maintain vendor information online.

For term contract suppliers, electronic catalogs will be created, so those

suppliers will have an initial time commitment to provide the data necessary

and to work with the team building the catalogs. After this introductory

period, the time needed for maintenance will be minimal.

4. How will this affect my company’s sales representatives?

This initiative should free your sales representatives to do two things: spend

more time strengthening relationships and less time on manual order

processing, and pursue new business opportunities offered as a result of access to a statewide and national marketplace.

5. What’s in it for suppliers?

E-Procurement will provide suppliers of all sizes access to an aggregated

audience of purchasers and the opportunity to expand their market share, as



well as the ability to receive standardized electronic orders, manage complex

bidding opportunities, and migrate customer service functions online,

thereby reducing the overall cost of sales.

6. How will E-Procurement affect the relationships I have with mycustomers?

E-Procurement reduces much of the manual work associated with offline

processes and paper-based orders, freeing sales representatives to spend

more time building valuable relationships with their customers.

7. How do I get orders?

Suppliers select the method they wish to receive orders when they register.

Delivery options include: fax, e-mail, EDI, and cXML. Each supplier will

have the opportunity to select their preference for receipt of orders during

the registration process.

8. What support will suppliers receive?

The State’s Supplier Manager will work closely with the term contract

suppliers to build and load their electronic catalogs, as well as support them

in maintaining data going forward. Those suppliers participating in eQuote

will also receive training and support services to enable them to participate.

9. What does the 1.75% marketing fee get used for?

The fee helps pay for the development and ongoing operations of the E-

Procurement Service; this includes the services required to effectively

implement an initiative of this size, develop and execute training required

for both buyers and suppliers, and provide the ongoing maintenance andservices needed to sustain the Service.

Documents

e-procurnment 1