Implementing a Successful E-Procurement Strategy
Implementing a Successful E-Procurement Strategy
Abstract
This paper will explore how and what a company should consider when interested in implementing an e-procurement process to their organization. With so many variables to consider and products out there it can be overwhelming and one may lose the goals and purpose the organization originally started with. If the right process is not in place, an organization may come out worse before the implement. If implemented correctly, the e-procurement process can increase efficiency, productivity and add additional cost savings opportunities. There are also benefits in supply chain with greater forecasting and providing a competitive edge against their competitors.
The primary objective for a business is to make a profit. Since every company buys goods and services and there are large amounts of money flowing through the purchasing process, it should be one of the most highly tuned areas. Procurement usually represents one of the largest expense items in an organization’s cost structure (Attaran & Attaran, 2002; Lennon, 2002). Originally the procurement process involved a lot of slow and manual processes for each transaction. With continual improvements coming from the internet, provides numerous opportunities to make procurement for goods and services more visible and efficient for corporations. Allowing e-business into an organizations world has drastically altered the way they interact with their vendors and suppliers (Phillips, 2003). E-procurement or electronic procurement, is the business-to-business or business-to-consumer or business-to-government purchase and sale of supplies, work and services through the Internet as well as other information and networking systems, such as Electronic Data Interchange and Enterprise Resource Planning enable new types of collaborative alliances between partners (Wikipedia.com).
There are seven main types of e-procurement which are stated below. Making
Abstract
This paper will explore how and what a company should consider when interested in implementing an e-procurement process to their organization. With so many variables to consider and products out there it can be overwhelming and one may lose the goals and purpose the organization originally started with. If the right process is not in place, an organization may come out worse before the implement. If implemented correctly, the e-procurement process can increase efficiency, productivity and add additional cost savings opportunities. There are also benefits in supply chain with greater forecasting and providing a competitive edge against their competitors.
The primary objective for a business is to make a profit. Since every company buys goods and services and there are large amounts of money flowing through the purchasing process, it should be one of the most highly tuned areas. Procurement usually represents one of the largest expense items in an organization’s cost structure (Attaran & Attaran, 2002; Lennon, 2002). Originally the procurement process involved a lot of slow and manual processes for each transaction. With continual improvements coming from the internet, provides numerous opportunities to make procurement for goods and services more visible and efficient for corporations. Allowing e-business into an organizations world has drastically altered the way they interact with their vendors and suppliers (Phillips, 2003). E-procurement or electronic procurement, is the business-to-business or business-to-consumer or business-to-government purchase and sale of supplies, work and services through the Internet as well as other information and networking systems, such as Electronic Data Interchange and Enterprise Resource Planning enable new types of collaborative alliances between partners (Wikipedia.com).
There are seven main types of e-procurement which are stated below. Making
References: Attaran, M., & Attaran, S. (2002). Catch the Wave of E-Procurement. Industrial Management, 11(3), May/June. Bushell, S. (2004, June 2). Getting A Grip on Spending. CIO Magazine, www.cio.com. Cooke, J.A. (2000) “The Dawn of Supply Chain Communities.” Logistics Management & Distribution Report 39, no. 2 : 44. Flynn, Michele & Yuva, John (2000). Following the Path to a Successful E-Procurement Strategy, Purchasing Today Hope-Ross, D. (2001, December 6). E-Procurement Odyssey: 2002 and Beyond. (Gartner Advisory/Research Note). Retrieved February 17, 2003, from http://www.gartnergroup.com. Lennon, C. (2002). Achieving Bottom Line Results in a Flat Economy: Leveraging Procurement Business Services. (Computer Sciences Corporation). http://www.csc.com. Marks, P. (2000) “E-procurement in Perspective.” Computer-Aided Engineering (50) 19, no. 2 Phillips, P.A., (2003). E-Business Strategy: Text and Cases, McGraw-Hill, Maidenhead, England “Study Shows Big Early Returns From E-procurement Investments.” Industrial Distribution 89, no. 2 (2000): 4 http://en.wikipedia.org/wiki/E-procurement