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Ev. 1
Electronic Procurement – A Big Step Towards Transparency and Efficiency
The Asian Development Bank’s Perspective
Jeff Taylor, Senior Procurement Specialist
Ev. 2
Electronic Procurement, Its Origins
Its not new: Materials Requirements Planning
(MRP) 1960sElectronic Point of Sale (EPOS) 1980sOrganization for Data Exchange by
Tele-Transmission in Europe (ODETTE) 1984
COVISNET (US Automotive/Oracle) 2000
Ev. 3
It’s Not a Panacea
The pyramids were built without it
It offers little transactional value for CAPEX
Toyota a global procurement benchmark using Kanban – paper
Rubbish in Rubbish Out. Computers Cannot Think
Ev. 4
There are Negatives
It passes on transaction costsRequires power asymmetry to
impose It does not measure absent
suppliers It can be used to limit
competition
Ev. 5
Seven Types of E-Procurement Trading Models
1. EDI Networks, few partners, simple transactions, batch processing.
2. Business to Business Hubs, simplest e-catalogue, complex requisition and payment. 1T1 or MTM.
3. Corporate Procurement Portals – such ADB’s CMS
Ev. 6
Seven Types of E-Procurement Trading Models
4. First Generation Trading Exchanges distributors/manufacturers aggregation
5. Second Generation Exchanges integrated requisitioning, price and product discovery
6. Third Generation Trading Exchanges, real-time fulfillment. Information for inventory
7. Industry consortia and the virtual factory
Ev. 7
E-procurement Benefits
Pareto optimal, 80:20 Rule (main private sector driver), TCE
Transparency – (main public sector driver)
StandardizationData capture and spend
analysisE-government and e-
governance
Ev. 8
E-procurement Challenges
•The Business Case•Standardizing specifications•Line item level, contract or unit?•Commodity Coding• In-house or out sourced project development?
•Functional Design•Regulatory and Legislative Environment
Ev. 9
E-procurement Challenges
Best Fit or Custom BuildFinancing – supply side or
demand? Integration with Existing
SystemsPurchasing powerOSFederal Vs State
Ev. 1
0
ADB Supported Initiatives
Its own Consulting ProcurementCMS
E-GEPS in the PhilippinesNCB Procurement in IndiaNCB Procurement in IndonesiaThe Asia Pacific Procurement
Initiative