eProcurement

[tomk]

how useful are effective is eProcurement? We are looking at developing a database of supplier and contractor performance records, linked to a website where suppliers and contractors can register and qualify for future business opportunities.

[Zool]

Only version of this I have seen, relates to on line auctions for transport. Which quite frankly I think undermine the whole transport industry. IMHO :-)

[Mars]

I reckon a lot of this is hype driven by the big consulting/software firms. Have not come across any significant sucess stories.

[Attila]

A lot of government departments are now going to e procurement. They reckon it will save transaction costs and reduce prices. Makes the whole thing a bit impersonal and highly competitive, but I guess if you want their business, you have to go along with it.

Personally we avoid Government contracts for these reasons and many more!

[Simple]

Originally Posted by tomk

how useful are effective is eProcurement? We are looking at developing a database of supplier and contractor performance records, linked to a website where suppliers and contractors can register and qualify for future business opportunities.

Maybe you can consider to join established marketplaces like Ariba Supplier Network. It's probably lower cost to quick start and much lesser maintenance.

I am saying this because my company implemented our own system but I just found it too costly and resource intensive to implement and sustain.

[Trucks n Sheds]

I haven't hear a lot of good things about on line auctions. Might be OK if you are buying commodity products like paper clips, but complex stuff or specialised services? I don't think so.

[Simple]

Originally Posted by Trucks n Sheds

I haven't hear a lot of good things about on line auctions. Might be OK if you are buying commodity products like paper clips, but complex stuff or specialised services? I don't think so.

If you are referring to on-line reverse auctions, there are a couple of advance auction features that can help. Example is transformed bidding (or weighted bidding). A typical process is after receiving the technical proposal, you will put in different score for different suppliers. The suppliers will then compete based on their different weighted score. This help to ensure that a supplier with a good specifications need not lost out just by price along.

Whatever the case, the principle behind is that the benefits must be equated to a dollar value. If the values are intrinsic in nature, such as creativity for advertisement campaign, then e-sourcing would not help. For that I share your point.

[Deepak Arecal]

just wondering,.... what kind of products we can go for acution.... ( i belive it depends on the criticality of product and supplier releationship)
could anyone explian about this ,,,
how can we select the products, which can source through the acution.....

cheers
Deepak Arekal

[TopLink]

I think the general view of on line auctions, is that they are suitable for 'generic' or 'commodity' products where almost the only differentiator amongst suppliers is price. Hence the term 'auction'.

But sadly many companies now use on line auctions for products and services that are not suited to this type of procurement.

For example.

Might Suit on line auction.
Petrol
Water
Flour

Where these products are provided via a very clear product specification ad quality control process.

Might Not Suit on line auction
Transport. Too many intricacies of service time, quality, supplier relationship.
Accounting. Where perhaps the supplier relationship, service flexibility etc is very important.


Just some thoughts.

[Starbucks Junkie]

Originally Posted by TopLink

I think the general view of on line auctions, is that they are suitable for 'generic' or 'commodity' products where almost the only differentiator amongst suppliers is price. Hence the term 'auction'.

But sadly many companies now use on line auctions for products and services that are not suited to this type of procurement.

For example.

Might Suit on line auction.
Petrol
Water
Flour

Where these products are provided via a very clear product specification ad quality control process.

Might Not Suit on line auction
Transport. Too many intricacies of service time, quality, supplier relationship.
Accounting. Where perhaps the supplier relationship, service flexibility etc is very important.


Just some thoughts.

Top Link,

That was a very good analogy...

eProcurement while it has its place in the modern supply chain will never replace the face to face buying, negotiating for supply and purchase, especially for intrinsically difficult to purchase products, such as you highlighted, products and services with many different supply variables.

I feel that trying to eProcure these will in the long run be very costly and risky as there are too many variables of the supply.

Just my own view and opinion.