Seunghyun Kang, Ph.D.

Public Procurement Service

Government of Korea

Innovating Public Procurement

Through KONEPS

3rd Global Conference on e-GP

Washington D.C.

November 9-11, 2009

Background of KONEPS

Characteristics of KONEPS

KONEPS Architecture

Contributions to Public Procurement

Public Procurement Service (PPS)

Procurement System in Korea

Centralized : $ 29B(28%)

Decentralized : $ 75B(72%)

The Central Procuring Agency (PPS)

Departments and Agencies

Combination of centralized and decentralized systems

Procurement System in Korea

The Volume of Public Procurement (FY 2008) : US$ 104B

Other procurement : each public entity

PPS : Governmental Body for Procurement

PPS is responsible for procurement of goods, services

and construction works with the following thresholds

Procurement System in Korea

2

▶ Central & Local governments, State-owned enterprises, etc

supplierscustomers

Public Procurement Service (PPS)

Created in 1949 as a provider of supply-related

services for government departments and agencies

Operated on a business-like, fee-for-service basis

Buys goods and services valued more than US$ 100K

Contracts for construction services valued more than US$ 3M

Stockpiles raw materials such as aluminium, copper, etc.

Manages government-owned properties

Operates Korea ON-line

E-Procurement System (KONEPS)

PPS Roles and Responsibilities

Public procurement market value : USD 104bn in 2008

- Approx. 10% of total GDP

PPS covers USD 29BN, 29%

06 07 08

81

95

104

TOTAL

24 2829

PPS

Volume of Public Procurement

Audit and Inspection OfficerGeneral Services

Division

Administrator

Deputy Administrator

Quality

Management Office11 Regional PPSs

Overseas Procurement Offices

(NY, Chicago, Tokyo, London, Beijing)

Office of Planning

& Coordination

e-Procurement

Service Bureau

International

Goods

Bureau

Procurement

Service

Bureau

Construction

Works

Bureau

PPS organization

Problems prior to KONEPS

Development of KONEPS

Electronic Data Interchange System (1997)

Online Shopping Mall System (1998)

e-Tendering System (2000)

e-Guarantee and e-Payment System (2001)

Preparation

Period

(1997-2001)

Gov’t-wide

Expansion

(2002-2004)

As one of 11 e-government projects, KONEPS was

developed for the use of the whole public organizations

(2002), Disaster Recover System, Data Warehouse, CRM

Characteristics of KONEPS

Single Window for Public Procurement

Characteristics of KONEPS

One-stop Service

Integration of Entire Procurement Work

Characteristics of KONEPS

KONEPS at a Glance

e-Tendering Flow

Stakeholders

Reliability and stability in e-transaction are secured thru digital signature and encryption technology. (PKI method is used)

Security and Authentication Method of e-bidding

Network Security

Separation of Internet and Extranet, Dual Fire-wall, Intrusion Detection

System, Security Solutions, etc

Periodic Security Check-up

System Operation complying with

ITILCheck and Balance between PPS and outsourced Operator, Programmers and

System managers

Access control to system, program and D/B

National Computing & Information Resources Center

Automatic management of log access and program modification history, post-

verification system

On-line monitoring of program modification by the independent body

Service Stability against accidents

Dual operation of servers and networks, Back-up Center(Data mirroring),

ITSM

E-payment is made after inspecting and accepting the final products

e-Payment

The online shopping mall on which public orgs. can purchase goods which are registered by PPS thru unit price contract or multiple supplier award with supplier.

e-Shopping Mall

Coping with Obstacles in Establishing KONEPS

Coping with Obstacles in Establishing KONEPS

Coping with Obstacles in Establishing KONEPS

38%

13%

2%

29%18%

Public Procurement in Korea

Use of KONEPS

2003 2006 2007 2008

$36 bn

$43 bn

$56 bn

$63 bn

Use of KONEPS

2003 2006 2007 2008

99,020k

207,633k213,539k

수정k

1540m

2082m2096m

2100m

2003 2006 2007 2008

553

665

700

112

Use of KONEPS

No longer need for personal visits

- time and transportation cost saving of 4.1billion USD

No longer need for manual paperwork

- time cost saving of 0.4 billion USD

Highly Enhanced Productivity

Highly Enhanced Productivity

Highly Enhanced Productivity

Transparent Public Procurement Accomplished

Promotion of Private e-Commerce Development

Contributions to Development of SMEs

Enhancing Procurement Capabilities

1st UN Public Service Award

“No further action further action required” OECD

Received the Global IT Exellence Award form WITSA

KONEPS procedures reflected in international standards

Honoured with E-ASIA AWARD

2003 2005

2007

2004

2006

International Recognition for KONEPS