Introduction to E-Procurement - Tools, Application and its Benefits
Sourcing Agents
In layman's term, e-procurement is absolutely nothing however electronic data transfer to support functional, tactical and strategic procurement. E-procurement has been presence for very long time in one type or the other earlier it was done through electronic information interchange. In today's environment, the majority of the e-procurement is done through the Internet.
Generally, procurement of supplies and product was done through paper, which gradually moved to use of an electronic medium for order printing and keeping. With the development of the Internet e-commerce flourished, and procurement was done through e-mail and sites. As the Internet technology developed e-catalogue came in the leading edge thus conventional procurement was getting done through the Internet. In the existing market with information security and advanced tools entire procedure of e-procurement is done through the Internet.
Procurement departments are discovered in most of the organization. There are responsible for purchase of basic material, workplace products, office equipment, center upkeep, etc. It is necessary for them to understand and comprehend the e-procurement concept so that they can add efficiency and effectiveness to the entire process.
Procurement supervisors need to have complete understanding of various e-procurement applications. He must be able to recognize procedures, which can make procurement reliable. He ought to have understanding of e-procurement advantage. He ought to understand threat connected with e-procurement application.
E-procurement Tools and Application
There are numerous tools and application which fall under e-procurement some of them are as follows:
In electronic information interchange system, procurement messages are exchange between computers of two different companies. Message is exchange in batch and can be easily sent and kept. EDI is mainly utilized for order transmission, order verification, logistic info and order invoicing.
Enterprise resource preparation system have separate module to deal with the procurement function.
Internet based tools and resources help in the process of procurement. Some of the common applications are email, web based EDI, XML based information exchange by means of the internet etc. Web provides tools for e-sourcing, e-tendering, e-auctioning, e-ordering and e-catalogue.
E-sourcing tool is utilized to determine prospective suppliers throughout the choice stage. E-tendering tool is utilized to send out tenders with procurement requirements, supply schedule, contracting terms, and so on. E-auctioning tools bring together potential supplier recognized throughout selection phase under one umbrella to carry out auctioning procedure. E-auctioning tools operate under two different mechanism, upward price system for selling company and down rate mechanism for the purchasing organization. E-ordering tool is used procurement of office materials and services; it is available by all employees within the organization and is mainly utilized for ad-hoc purchases. A web-based ERP tool is used for product-related purchases, is specifically used by the procurement department, and falls under a scheduled process.
A traditional procurement process starts with stage requirement meaning, sourcing, solicitation, evaluation, contracting and contract management. In the web based this steps are changed by e-sourcing, e-tendering, e-reverse auction, e-ordering and web based ERP.
E-procurement Benefits
E-procurement affects the following:
The cost sustained on products and services associated with production.
The cost sustained on procurement procedure such as buying, administrative support etc
. The expense incurred on specification formula, supplier selection and so on
. The expense benefit in establishing relationship with suppliers.
It promotes openness while doing so and therefore improves responsibility.
In layman's term, e-procurement is absolutely nothing however electronic data transfer to support functional, tactical and strategic procurement. E-procurement has been presence for very long time in one type or the other earlier it was done through electronic information interchange. In today's environment, the majority of the e-procurement is done through the Internet.
Generally, procurement of supplies and product was done through paper, which gradually moved to use of an electronic medium for order printing and keeping. With the development of the Internet e-commerce flourished, and procurement was done through e-mail and sites. As the Internet technology developed e-catalogue came in the leading edge thus conventional procurement was getting done through the Internet. In the existing market with information security and advanced tools entire procedure of e-procurement is done through the Internet.
Procurement departments are discovered in most of the organization. There are responsible for purchase of basic material, workplace products, office equipment, center upkeep, etc. It is necessary for them to understand and comprehend the e-procurement concept so that they can add efficiency and effectiveness to the entire process.
Procurement supervisors need to have complete understanding of various e-procurement applications. He must be able to recognize procedures, which can make procurement reliable. He ought to have understanding of e-procurement advantage. He ought to understand threat connected with e-procurement application.
E-procurement Tools and Application
There are numerous tools and application which fall under e-procurement some of them are as follows:
In electronic information interchange system, procurement messages are exchange between computers of two different companies. Message is exchange in batch and can be easily sent and kept. EDI is mainly utilized for order transmission, order verification, logistic info and order invoicing.
Enterprise resource preparation system have separate module to deal with the procurement function.
Internet based tools and resources help in the process of procurement. Some of the common applications are email, web based EDI, XML based information exchange by means of the internet etc. Web provides tools for e-sourcing, e-tendering, e-auctioning, e-ordering and e-catalogue.
E-sourcing tool is utilized to determine prospective suppliers throughout the choice stage. E-tendering tool is utilized to send out tenders with procurement requirements, supply schedule, contracting terms, and so on. E-auctioning tools bring together potential supplier recognized throughout selection phase under one umbrella to carry out auctioning procedure. E-auctioning tools operate under two different mechanism, upward price system for selling company and down rate mechanism for the purchasing organization. E-ordering tool is used procurement of office materials and services; it is available by all employees within the organization and is mainly utilized for ad-hoc purchases. A web-based ERP tool is used for product-related purchases, is specifically used by the procurement department, and falls under a scheduled process.
A traditional procurement process starts with stage requirement meaning, sourcing, solicitation, evaluation, contracting and contract management. In the web based this steps are changed by e-sourcing, e-tendering, e-reverse auction, e-ordering and web based ERP.
E-procurement Benefits
E-procurement affects the following:
The cost sustained on products and services associated with production.
The cost sustained on procurement procedure such as buying, administrative support etc
. The expense incurred on specification formula, supplier selection and so on
. The expense benefit in establishing relationship with suppliers.
It promotes openness while doing so and therefore improves responsibility.
Replies