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Tuesday, 16 December 2014

eProcurement Enhances Organizational Performance


Web-enabled applications for business-to-business (B2B) procurement are not only expected to reduce the cost of purchasing process but also to alter the activities of purchasing, transform the purchasing process from an operational into a strategic activity and provide opportunities for improving market coordination by reducing asset specificity and by making additional partners available. The results driven through implementing Web-based e-procurement system not only enhance the performance of the buyer organization but also enhance the performance of the supplier organization and improve partner relationship management.

The benefits resulting from implementing Web-based e-procurement system for direct procurement (i.e. purchasing production-related items) can be either belonged to organizational level or inter-organizational level. The organizational-level benefits are generated by Web-based e-procurement through automating procurement process and reengineering the internal processes of an organization. The inter-organizational-level benefits are generated by Web-based e-procurement through reengineering the procurement process among trading partners and re-configuring the linkages of trading partners.