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eProcurement

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Low efficiency manual process. Lack of transparency in procurement leading to ... Cartel formation. Manipulate selection by bribing department staff ... – PowerPoint PPT presentation

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Title: eProcurement


1
e-Procurement for Government
Assocham National Summit e-Governance for 10
Growth
Neel Ratan PricewaterhouseCoopers July 14 2006
2
Agenda
  • Need
  • e-Procurement for Growth
  • Elements
  • Expected Outcomes
  • Issues
  • Way Forward

3
Need for e-Procurement
  • Lack of a common public procurement policy
  • Lack of standardization in implementing
    procurement practices processes
  • Low efficiency manual process
  • Lack of transparency in procurement leading to
    corruption pilferage of public monies
  • Only two Indian states have an Act in place
  • Malpractices by vendors
  • Cartel formation
  • Manipulate selection by bribing department staff
  • Advances in electronic procurement through
    secured internet-enabled means have not being
    utilized in a widespread manner

4
e-Government Procurement
e-Government Procurement is the collaborative
procurement of goods, works and services by the
Public Sector using electronic methods at every
stage ensuring transparency and efficiency.
5
e-Procurement for Growth
  • Excellent strategic cum operational tool to
    ensure large scale savings and thereby ensure
    growth
  • e-Procurement savings are achieved through
  • Transparency in the process
  • Higher participation better competition
  • Streamlined processes
  • Demand aggregation
  • Indian Government spends an estimated 100
    billion in public procurement each year
  • A 10 cut in procurement costs would translate to
    Rs. 45,000 crore
  • Savings could be routed for Infrastructure
    Development

Source World Bank
6
Key Elements of e-Procurement
  • Process Reengineering
  • Works Procurement- e.g. Electronic measurement
    book, Inter department approval workflow
  • Goods Procurement- Centralization and demand
    aggregation
  • Business model
  • PPP is preferred by Governments to avoid high
    capital investment
  • Technical architecture
  • Scalable, secure, and interoperable
  • Centralized vs. Decentralized
  • Infrastructure
  • Data Center, networking, Security (PKI, etc.)
  • Capacity Building
  • Government Supplier Community

7
Expected Outcomes
  • Enhanced transparency and control in procurement
    process
  • Reduced cost of doing business for both
    government and suppliers
  • Savings of up to 15-25 of procurement value
    realized by states
  • Economies of scale through demand aggregation
  • Streamlined integrated processes cutting across
    departments
  • End-to-end automation of procurement (indent to
    delivery)
  • Automatic bid evaluation
  • Overall bid process time reduction
  • Catalyst for procurement process reforms

8
Issues
  • Concerns of security of data and online
    transactions
  • Limited scope of current implementations- most
    implementations do not involve
  • Demand aggregation across departments states
  • Contract lifecycle monitoring
  • Un-evolved Business Model
  • Willingness of states to embrace e-Procurement
    to what extent
  • Parallel manual processes even after
    e-Procurement
  • Insufficient positive publicity supported by data
  • National level repository of e-Procurement
    successes and savings
  • Legislative/administrative changes to accept
    e-Procurement

9
Way Forward
  • Integration of various Govt eProcurement
    exchanges
  • Demand aggregation
  • MIS generation for better spend analysis
  • Better and wider supplier response
  • Access to supplier performance information
  • Standardized procurement policies
  • Integrated platforms facilitating seamless flow
    of data across departments states
  • Treasury, Finance Department
  • Common Item Coding Systems
  • Auto bid evaluation
  • Digital certificates for Security

10
  • Thank You
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