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E-Commerce Discussion Panel
Panelists: Joan Matsumoto, MACarol Wilson, CT
Mike Mangum, NCTina McLamb, NC
Online Bidder QuickTipshttp:// www.mass.gov/osd
What is an eProcurement System?
• Typically, “e” implies web-enablement, but generally means “paperless.”
• Use of the term “eProcurement” may vary from state to state
• May be a single system or many systems
• May be fully or partially integrated, or not integrated at all
• May support only a portion of the state’s public entities or all
• May be required by law or regulation for some or all processes
Online Bidder QuickTipshttp:// www.mass.gov/osd
eProcurement Processes
Record Management
Vendor ManagementBidder Notification
Record Management*
Bidder Registration
Bids Contracts Purchases Payments
Bid Submission
Bid Tabulation
Bid Disposition
Order Receipt
Catalog Creation/Management
Catalog Purchasing Reconciliation
Encumbrance
Payment
Bidder Notification
Bidder Conference
* BIDS: WTO Notices, RFI, RFP, ITB, Internal Requisitions
Reverse Auction
Request for Quote
Online Bidder QuickTipshttp:// www.mass.gov/osd
Public Bidder Questions
Required?
Fee/Bond?
Bidder or Buyer Managed?
Goods & Services, Human and Social Services, Construction?
Single or multiple systems/sources within the state?
Online Bidder QuickTipshttp:// www.mass.gov/osd
• Comm-PASS is the Commonwealth Procurement Access & Solicitation Site
• Launched in 1997 to increase competition, value through public access
• Home-coded “bulletin board” replaced by BearingPoint system in 2004
• Data system supports workflow, transactions for bid-contract processes
• Required posting site for announcements/bid specifications for:
• any executive department goods/services, human and social services bid exceeding $50K
• all public entity construction exceeding $10M
• Open to any public entity in Massachusetts at no charge, includes free training
• Posting are accessible at no charge to anyone with Internet access
• THERE IS NO PRE-QUALIFICATION/REGISTRATION IN MASSACHUSETTS
eProcurement in Massachusetts: Comm-PASS
Bidder Notification
Record Management
Bidder “Registration”
Bid SubmissionBidder Conference
Online Bidder QuickTipshttp:// www.mass.gov/osd
Statewide Contract Procurements on Comm-PASS
• All announcements, requests for information, solicitations, and contract awards
• All written questions must be submitted via the Forum
• All written answers are posted via the Forum
• Bidders may elect to subscribe for optional value-added services
• Automatic notification of new posting and amendments for solicitations, contracts, forums
• Appear in the Business Directory, a publicly accessible “yellow-pages” style web-listing
• Create and submit responses online to eliminate paper, waive and defer wet-ink signatures
• Bid tracking through a customizable system “desktop”
• Subscription is not required to access or respond to any posted opportunity
• Subscription fees are based on Massachusetts fee policy: avoidable, based on cost offset
E-Commerce in Connecticut
Carol Wilson, C.P.M., Director of Procurement
State of Connecticut
April 4, 2006
Online Bidder QuickTips
E-Commerce History in Connecticut
• 1997 – Developed website with general procurement information – Contracts viewable online.
• 1998 – Inception of online Bidder Notification System (moved away from paper mailing of bid notices and advertising in publications).
Online Bidder QuickTips
• 2000-2002 – Announced and Implemented Connecticut’s 1st agency online ordering system – “Orderlink” for contract purchases.
• 2003 – Migrated from “Orderlink” to statewide ERP system (integrated central accounting, purchasing, personnel and payroll system).
• 2005 – Enhanced online Bid Notification System to State Contracting Portal (all agency solicitations posted here – open, transparent, accessible government).
E-Commerce History in Connecticut
Online Bidder QuickTips
• 2003-2006 – Focus on obtaining clean Data Catalogs required from Suppliers for ERP purchasing system (E-Catalogs).
• 2005-2006 – Developed and Rolled-Out Online Small/Minority Business Certification Application System.
E-Commerce History in Connecticut
Online Bidder QuickTips
What’s Next in Connecticut?
• 2006 – Expect to roll-out online Supplier Performance Reporting & Resolution System (interactive between agency, procurement office and suppliers).
• 2006 – Developing online Bid Response System.
Online Bidder QuickTips
How can Suppliers Assist Us?
• Utilize Procurement web options (bid notification systems, online certifications, bid response systems).
• Communicate and Provide Constructive Feedback for Improvements
• Provide Procurement Staff with Technical Contacts who can competently respond to E-Catalog needs.
Online Bidder QuickTips
External (Supplier) Challenges of E-Catalogs
• Complete and Accurate Catalogs (contract data)
• Properly Formatted Catalogs (field names, field lengths, field types, required vs. optional fields, etc.)
• Timely Catalog Updates/Maintenance
Online Bidder QuickTips
Internal (State) Challenges of E-Catalogs
• System Functionality
• Timely Catalog Updates/Maintenance
• Impact of Errors on other ERP System modules
• Impact of Integrity of Data on Accounting Functions/Audit.
Online Bidder QuickTips
Keys to Success in E-Commerce Initiatives
• Be Flexible
• Stay informed of latest initiatives
• Communicate
• Participate
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E-Procurement Overview
The system, which went live in October 2001, is comprised of the Ariba Buyer web-based software product with public sector extensions, a Statewide Vendor Registration application, and a marketplace for performing informal quotes electronically.
E-Procurement is an effort to transform the way the State of North Carolina purchases goods and services, as follows:
It is an enterprise e-procurement system that allows government entities to aggregate their purchases to obtain better prices from their suppliers.
Users are empowered to use online requisitioning through the Internet with direct access to state term contracts.
Entities can choose to decentralize the purchasing process.
The eQuote tool allows users to submit requests for quotes to specific vendors for items below the sealed bid and advertising requirement, replacing more manual quoting processes. Responses (quotes) are submitted and evaluated electronically.
Orders and approvals are routed electronically.
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E-Procurement Statistics
E-Procurement Statistics: As of March 5, 2006 Over 1 million purchase orders issued Over $5.6 billion in purchases Over 45,000 vendors registered Over 13,000 system users 238 purchasing entities using system
Who is using NC E-Procurement @ Your Service? All State Agencies - 29 Institutions and Hospitals - 15 Local Education Authorities (K-12 Public Schools) – 115 of 115 Community Colleges – 57 of 58 Local Governments - 22
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E-Procurement Organization
Sponsorship– Governor’s Endorsement
– Enabling Legislation
– Sponsoring Agencies• Purchase and Contract
• Information Technology Services
• Office of the State Controller
Enterprise-Wide– State Agencies
– Institutions & Hospitals
– K-12 Public Schools
– Community Colleges
– Local Governments
46
E-Procurement Organization
Advisory/Work GroupsCross Entity Representation
– Advisory Committee– Users Groups– HUB Office
Project Management– State Project Director– State/Accenture
Management Committee– Accenture as Application
Service Provider
Business Model– No Appropriated Funding
– Transaction Fee on Purchase Orders
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E-Procurement Features
Functionality– Electronic Requisition– Automated Rule-Based
Approval– Funds Checking– P-Card– Electronic Purchase Orders– On-line Receipts– eQuote/Informal Quote Tool– Catalogs/Term Contracts– Vendor Registration/HUB
Certification– Reporting
Core Software– Ariba
– eQuote (custom)
– Vendor Registration (custom)
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E-Procurement Scope
On-line integration with six financial systems– State Agencies/Institutions
– 1 Financial System– Community Colleges
– 1 Financial System– K-12 Public Schools
– 4 Financial Systems
Additional Opportunities – Reverse Auctions
– Strategic Sourcing
– Integration with Universities
– Continued statewide rollout to local government
49
Support for E-Procurement Program
40 personnel supporting E-Procurement operationsCall center handling roughly 500 customer inquiries per week; also supporting user communications and trainingApplication support providing ongoing maintenance and enhancements for the systemTechnical support hosting the E-Procurement infrastructure and providing 99.5% availabilityNew Development Team responsible for implementing local schools, community colleges, and universitiesCatalog enablement managing content for approximately 125 State Term Contracts and 500 catalogs Billing team creating and processing an average of 6,000 invoices per month to 17,000 vendor locations.
50
Benefits of E-Procurement
Reduced prices through increased competition and aggregation of demand
Increased operating efficiency and reduced administrative costs
One Stop Shopping Online quoting tool – eQuote Increased order accuracy Online catalogs for statewide term contract items Electronic approval flows Access to new vendors Auto-Tabulated quotes
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E-ProcurementBenefits Analysis
In reaction to staffing and budget constraints from 2001 through 2003, the State leveraged E-Procurement to spend its dollars more efficiently and manage the procurement function more effectively.
Price reduction savings over first two years ofE-Procurement operations: $127 million
Cost savings of $127 M are the result of a 7.24% decrease in prices.
First-class purchasing system has been implemented and maintained with no State funds expended as a result of an innovative public / private partnership.
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Specific areas of measured benefit
eQuote: Savings average 26% on items purchased using eQuote.
Term Contracts: Savings realized range from 3% to 23% on term contracts re-bid as a result of changes in contract strategy due to eProcurement.
Cycle Time Reduction: Process savings range from 26 – 50% when the elapsed time from order creation to goods receipt was measured for four agencies one year prior to E-Procurement go-live and one year after E-Procurement go-live.