Directorate of distance education

Workflow of Procurement Process

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Notes
262
E-procurement Challenges 
Organizational
➢ Many users are resistant to change, simply due to human nature 
and habit
➢ Users may believe that e-procurement will make their job more 
difficult or cumbersome
➢ Current roles will change due to the impact of e-procurement
Economic-Legal
➢ Level of economic development
➢ Regulatory framework
➢ Technological scenario
➢ Existence of private competitor services
➢ General Education level
Objectives of E-Procurement
➢ Reduce cycle times of procurement
➢ Increase supplier access to ensure wider participation
➢ Reduce costs of procurement through competitive bidding and 
Reverse Auctioning
➢ Remove cartelisation by supplier groups(Reverse Auctioning)
➢ Increase visibility of procurement spend, for effective decision 
making
➢ Increase transparency in the procurement process
➢ Almost complete elimination of paper work, for speedy and efficient 
functioning

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263
E-procurement process and ICT Supporting Tools
E-Procurement Models
Activity Based Model
➢ Indirect Procurement System (IPS) - Contracting subject do not 
coincide with the ordering administration
➢ Direct Procurement System (DPS) - Contracting subject coincides 
with the ordering administration
Organization Based Model
➢ Centralized Model - Purchasing procedures are centralized
➢ Decentralized Model - purchasing procedures depend on each 
administration unit

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264
Old Generation E-procurement: Direct Effects
As a critical part of eSCM, the inefficiencies of old procurement practices have had to be 
abandoned by companies seeking to be competitive. As global markets emerge and efficiencies 
of e-commerce eventuate, e-procurement has become an essential subset of eSCM.
E-procurement is dealt with here, before e-fulfilment, because it sits on the ‘buy side’ of 
a business’s supply chain. E-procurement confirms how supply chain integration is influencing 
businesses.