Strategy for e-

Procurement

June 7th 2004

Presentation by:

Reynolds Alex P.A.

Confidential. Not for free circulation

Tour de Presentation

▪ eProcurement challenges

▪ Possible Models for Implementation in Govt

▪ Suggested approaches applicable in India

▪ Wipro experience & learnings in roll-out of eProcurement

▪ Wipro Strengths & Capabilities

▪ Customer testimonials

Our clients: Industry leaders

Diversified client profile

Driven in pursuit of excellence

Some e-procurement Govt/ PSU clients (e-GP)

• OGC - Office of Govt Commerce - U.K

• Govt of Chattisgarh

• Govt of Karnataka

• Govt of Tamilnadu

• Indian railways

• State Bank of India & its associates

• IOCL

• BPCL

• BHEL

• Unit Trust of India

• IDBI

• SIDBI

eProcurement challenges

▪ Buyer Adoption

• Strong Leadership , Political support and top-down approach is

critical

• Securing high level support to negotiate better prices through

volume aggregation

• Commitment to the business model and approach chosen for roll-out

• Commitment in achieving process efficiencies and effecting changes

in legal & regulatory framework to streamline the process changes

• IT readiness -infrastructure & user training

eProcurement challenges

▪ Supplier Management

• Relationship must be beneficial to suppliers

• Providing support & services for suppliers who are not

yet prepared to go online

• Working with smaller businesses not enabled for e-

Procurement

• Continuing to build and sustain relationships with

suppliers

eProcurement challenges

▪ Integration to Legacy & Back-end systems

• Current applications are customized hence integration – big challenge

• Many Govt depts are still running manual systems, implementation of pre &

post procurement systems and building integration is critical

• IT infrastructure readiness in terms of hardware, software, connectivity/ linkage

is below par

• Government would intend to leverage existing investments and hence

integration assumes importance

eProcurement challenges

▪ Security & data sharing

• Internet enabled procurement means transaction on public

domain ,perception holds contradictory to the confidential nature of the bidding process

• Physical bidding process provides documentary proofs and the

electronic system is assumed to be incapable of providing the same

• e-Procurement process is about data sharing, communication & is

competitive - security of such a system is of paramount importance

• Evolving regulatory frame works

• Choice of technology in the rapidly changing technology landscape

Integrated Commerce Platform: Easy Source From Customization

to Configuration

From Unified to

Modular

From technology

Solution to

Business Solution

Possible Models of Implementation

Development Road Map ds

Phase 1

Phase 2Phase 3

Phase 4

Drawing Collaboration

ETS

Priority of deployment

Application Type of Spend

Impact Priority in deployment

Electronic Tendering System

All Process improvement and efficiency

2

Dynamic Pricing Engine

All Savings (Reverse Auctions)

1

Catalog Low value items

Compliance to contracts

4

Supply Management

All Process improvement and efficiency

3

Suggested approach models

• ASP or Hosted Model

• License Model

• ASP model graduating to transfer of technology

Implementation risks & mitigation strategy

Mat

uri

ty L

evel

Sec

uri

ty i

s p

aram

ou

nt

• Poor system design

• Inadequate & or inefficient purchasing process

• Poor Systems performance / Software failure

• Security Breaches

• User suppliers adoption

• Mis-representation of process by users

• Connectivity for SME

Wipro learnings & experience in roll-out of e-Pro in the Govt

• Public bodies successful in implementing e-Procurement make and communicate clear policy decisions and directives to all concerned stake holders with measurable performance indicators and objectives

• Governments identify areas of process improvement and automation , with a view to process re-engineering

• Outline specific road map with time lines for implementing e- Procurement in terms of applications as well as government departments 

• Phase wise implementation approach

• Deployment e- Procurement through the hosted model and then move on to actual transfer of technology

Wipro learnings & experience in roll-out of e-Pro in the Govt

• Applications /e- procurement processes that can offer immediate quick wins in terms of tangible savings are given a higher priority

• Applications that result in process improvement and efficiencies are deployed in subsequent phases

• A overall process automation vision is created and implemented in pilot departments

• Subsequently the entire set of e-Procurement applications is rolled out to other departments

• Security is given prime importance in these applications

• Applications & process should preferably adhere to World Bank guidelines along with local statutory requirements

The Integrated Business Process

From disparate business processes

To integrated business processes

From Multiple applications to single application

From islands on information to a centralized business information

Typical Integrated Business Model

Suggestions for e-GP system Implementation

▪ Suggestions based on experience with GOI, State Govt Implementations

• GOI Should make clear policies to implement e-Procurement across all the government departments and communicate to all concerned stake holders with measurable performance indicators and objectives

• GOI should detail specific road map with time lines for implementing e-Procurement in terms of applications as well as government departments

• GOI should conduct a business process study of procurement to arrive at feature list , best practices model for e-Procurement that can be rolled across all the government departments in the country. A suitable consultant with prior experience in e-Governance and e-Procurement in India may be appointed to do this as well as the above activities

Suggestions for e-GP system Implementation

• GOI should engage in establishing a suitable vendor or empanel two to three vendors who can provide infrastructure, applications, domain knowledge, process re-engineering knowledge & consulting

• All departments should be directed to use the applications with specific incentives for using e-Procurement

• Evaluation of computer literacy of the users in departments, the task of improving the computer literacy should be entrusted to a separate set of vendors

• Complete spend analysis of government spending and the correct e-Procurement tools to address various types of spends should be carried out

Suggestions for e-GP system Implementation

• GOI to implement e-Procurement in a phase wise manner starting with Reverse Auctions addressing major spend in pilot departments, GOI realize quick wins and boost the E Procurement initiative

• The next phase should cover ETMS for the pilot departments the integrated reverse auction as well electronic tendering in the pilot phases should be carried out on an ASP basis

• The ETMS and Reverse Auction combination should be then rolled out to other departments and GOI should allow the process to stabilize over a period of 1 to 2 years

• The eventual transfer of technology should be planned subsequent to stabilization of ASP model

Wipro e-GP Credentials: 01markets

Portfolio World’s First IT company to be CMM L5 & CMMi certified; Always cutting-edge technology Integrated Commerce Platform (ICP):complete suite of e-Procurement solutions (COTS); Procurement domain Consulting and e-procurement Best practices

Presence• Support in India and the world; World class infrastructure and local presence• Flexible and tailored Buyer - supplier Training services for effective usage & deployment Integrity for fair, transparent and ethical e-procurement practices

Process ISO 9001certified; Defined, documented & time-tested procedures Critical Business processes’ Quality controlled using Six-Sigma BS 7799 (British Standard for Information Security Mgmt System - UK-AS)

People

500 man years of procurement - Process & Domain Knowledge

CPM (ISM) & CPIM (APICS, USA) Certified Procurement professionals

PCMM L5 practices for HR & people management; Dec 2001, World’s First

Leader

Over 150 e-Procurement clients in India, Asia-pacific, Middle East & the U.K.

More than 215 Categories (products and services) e-sourced: Over 700 e-Procurement projects till date (Almost 1 client goes e-live per

day)

Chhattisgarh Experience - Difficulties

▪ Process of modification of tendering rules and guidelines took too long because of frequent transfer of officials

▪ Lack of awareness of nitty-gritties of web based tendering process among senior IAS officers

▪ Availability of computers and internet connections in some government offices posed a big problem

▪ Absence of a secretary level nodal officer for e-governance / web based tendering created delays.

Chhattisgarh Experience - Achievements

▪ Savings for contractors in document fees

▪ Instant access to all tender notices and tender documents for contractors

▪ PWD officials handling tender publication on the web and bid opening on the web on their own

▪ All tenders above 1 crore and 40 % above 50 lakhs being now handled through tendering

▪ 90 % Reduction in tender preparation time and 80 % in preparation of bid comparison charts

▪ NABARD can now monitor tender progress on monitoring projects funded by them

Our Key Differentiators

Assured cost-savings

Proven reliability

Quality leadership

Commitment to go the extra mile

01Markets is a committed and professional team and offers several services in connection with eProcurement. They have carried out nearly 20 e-Sourcing Projects for JK Organization in a most professional and transparent manner in the shortest possible time. We are satisfied by the results achieved. We have planned more number of e-Sourcing projects in the near future.”

- Mr S K Dham, Senior GM - Materials, JK Organisation, India

"The e-procurement software developed by Wipro-01 markets, was successfully implemented for conducting Online web tendering & online bidding. The process was completely transparent, in line with existing policies & an extension of e-governance initiatives taken up by us in line with our state governments' policies. The training imparted by Wipro to the participating vendors ensured that the process was completed in time. This has benefited the corporation in reduction of overall cycle time and costs.”

- R. Sreekumar, CMD, Karnataka State Police Housing Corp. Ltd.

“We are delighted to partner with a reliable and known name like Wipro - 01markets as we venture out to streamline our procurement processes. The Almana group has always prided in its ability to be at the cutting edge of technology when it comes to operational issues and we are happy to extend this to a key area like purchasing."

Dr Aisha Almana, Director - Almana Group of Hospitals, Saudi Arabia

"Our decision to have a long term partnership with Wipro stems from the confidence we have in them based on their excellent track record in handling mission critical IT projects, depth of technical expertise and world class quality processes“

- Paul Grice, Chief Executive- Scottish Parliament

“From the first day in dealing with Wipro, there’s been nothing but quality character, highest integrity, highest quality work. As a Joint Venture, you wouldn’t find a better partner. As a supplier, you wouldn’t find a higher quality partner .” Jack Welch - GE

“I believe, that within two or three years, it will be a commonsense for anybody wanting to source a complex IT project or services, to ask themselves, “Have we talked to Wipro to ask whether they can help us to get this done.”

Bill Gates, Chairman, Microsoft Inc.

Partnering with Wipro: Why should you?

THANK YOU

www.01markets.com; www.wipro.com/government

Our Promise

With utmost respect to human values,

we promise to serve our customer with integrity,

through a variety of innovative,

value for money products & services, by applying

thought, day after day.

QUESTIONS?For more information contact:

Reynolds Alex

Head - eGovt Procurement (India, APAC, ME and UK)

reynolds.alex@wipro.com 9845276803; 9811690122

Security Breaches

▪ Data at Source

• Authentication thro’ Digital Certificate • Application is PKI enabled• Digital certificate policy maintained in the policy

▪ Data in Transit

• Data transmitted thro’ 128 bit encryption• Data transmit thro’ Hypertext Transport Protocol Secure • Application enabled for Secure Socket Layer (SSL)

▪ Data At rest

• Data Hashed(SHA1) Stored in Encrypted algorithm• Encrypted transaction data• Data signed with private key• Server Access Restricted• Fire Wall

Security Breaches

▪ Application Level

• User application rights

• User role/ rule Based Data Access

• Windows authentication to resources

• Server Restricted Access

• File Authorization

• IP security Protocol

• Passwords Are Hashed

Back

User/ Supplier adoption

• Ease of use

• Resemblance of traditional formats

• Awareness & training

• Interactive self help training material

• Incentive for usage

• Educate, advantages to suppliers

• Support

• System flexibility to change

Back