e-Procurement or Manual procurement?

e-Procurement or electronic procurement refers to the process of purchase and sale of goods or services through electronic methods, primarily the Internet. 

Supply Chain Management is vital for any business. Organizations invest a lot of resources in the process of procuring goods, services and raw materials. So, an efficient and stream lined procurement process is a huge advantage for businesses.

e-Procurement consists of Indent Management, RFX creation, e-Tendering, e-Auctioning, Vendor Management and Contract Management among other processes. An e-Procurement solution can automate the whole process, thus saving the organizations from the hassle and irregularities involved in manual procurement.

The e-Procurement suites may differ on the basis of what they offer to the user. The main components of a typical e-Procurement suite are the follows-

1. Indent Management: This process is basically the first step involved in e-tendering. Indent creation or the creation of requisition is undertaken, followed by its evaluation and approval.

2. RFX Creation: RFX is a catch-all term for terms like Request For Proposal (RFP), Request For Information (RFI), Request For Bids (RFB) and Request For Quotes (RFQ). This step involves the creation of RFX and formulation of technical and commercial qualification criteria. The RFX is then published and the prospective bidders are invited.

3. Bid Submission: The interested bidders then register themselves on the e-Procurement portal and submit their bids which would give detailed account of their technical as well as commercial qualifications.

4. Bid Opening and Evaluation: Once the bids are successfully submitted, they are evaluated and the vendors are scrutinized. Thereafter, the shortlisted vendors are invited for e-Auction.

5. e-Auction: The e-Auction is then carried out for procuring the goods or services under consideration. E-Auction too can be of several types depending on the specific requirements.

6. Vendor Selection and Finalization: After the e-Auction, according to the requirement, one or more vendors are finalized and the Purchase Order issued. This step concludes the procurement process.

7. Vendor and Contract Management: This additional module is included to manage and catalog the vendors and to evaluate their services.

The manual procurement process has always been pestered by the inefficiency of the system, lack of transparency, less accessibility and unwarranted expenditures. e-Procurement platform can overcome all these shortcoming and thus prove to be a necessity for any business. The digitizing of the procurement process leads to simplified workflow. It also makes the process equally accessible for everyone.

Written By 

-Gazi Sanaul Hasan 

Cargo Sales Executive,Singapore Airlines Cargo 

B.Sc in Logistics & Supply Chain Management 

Masters in Operation Management,Indian Institute of Management