1. The rise of the Internet and the World Wide Web boom in early 90’s created the first electronic markets (e-Markets) resulting in change in global community rapidly. The continuous improvement of information and communication technology affects the world market. Gone are the days of pushing papers in the world of procurement for both the public and private sector, as e-Business transforms the market for works, services and supplies globally. This has resulted in increasing the country’s productivity and removal of domestic barriers to international, thus re-defining the ways governments and companies used to manage their supply chains.
2. Continuous change and progressive development are very common phenomenon in the organizations today. Although, different types of change related projects are frequently launched, the change actually requires a lot of effort, resources and management from the organization, especially in order to truly succeed in the change process. Nowadays, it is common that organizations are digitizing their supply chain management related processes. Digitization and the ever-developing information technologies and systems enable organizations to communicate as well as trade both with their customers and their suppliers in a faster, efficient and at a larger scale pan across the entire globe. Businesses of today tend to focus in amassing their purchase power and reducing expenses with external suppliers to increase both profits and stock value. In order to get more detailed information about the different expense categories, creating efficient and standardized purchasing processes and have cohesive contract and supply base management in place, many businesses have adopted different types of electronic systems to better understand and analyze expense related processes and thus to make the tendering processes cohesive. A variety of electronic tools are available in market to enhance the productivity and contribute to value creation of the procurement professionals. The primary strategic objectives of adoption of ibid electronic tools is to overall manage and integrate the entire supply chain, price pressure and cost reduction, knowledge development and learning, information flow control, management of global suppliers, development of cohesive procurement practices and lead time management.
3. Sourcing is an intellectually complex, and conventionally, highly manual process. Organisations have always practiced some level of ‘Sourcing’. At its most basic, it is the process of analyzing expense process of an organisation, understanding the opportunities to reduce expense based on an understanding of the external market versus internal requirements, develop a strategy to manage the expense, conduct RFIs and RFPs, negotiate contracts, implement contracts and measure supplier performance.
4. Recent developments in internet technology connectivity provide an excellent opportunity to make sourcing for works, services and supplies more transparent and efficient. Integration of public procurement with information technology can be an appropriate means to achieve the primary objective of healthy competition, such as access to information, level playing field for all participants in the market.
5. This paper attempts to study the best practices of electronic sourcing
(e-Sourcing) application implementation in world markets to show that e-Sourcing, particularly in the public domain has evolved as an effective tool to establish the fundamentals of market’s economy and hence increases organisations productivity, remove domestic barriers to international trade and improve efficiency.
6. e-Sourcing is the process enabled with appropriate web-enabled, collaborative technology to facilitate the full life-cycle of the procurement process for both buyers and suppliers. The benefits of e-Sourcing include streamlining the sourcing process, reduction of cost by maximizing supplier competition, and creating a repository for sourcing information.
7. Presently, the companies are investing heavily in digital technologies with purpose of reducing the procurement cycle resulting in increased transparency and make the process more efficient. Organizations are now investing more in procurement technologies such as expenditure visibility, e-Sourcing, contract management and requisition to pay. Majority of ibid technologies emerged in the 1990s have now improved substantially and become more user friendly making them easier to adopt, use and get benefitted. The growth of e-Sourcing usage over past two decades is caused by several internal and external forces including the ability for buyers and suppliers to communicate economically in real-time and worldwide through use of easily available robust, user-friendly and Internet-based software systems. There are multiple options available in today’s world market of electronic applications that can be utilized in the field of supply chain management. The technologies are used by manufacturers, suppliers and retailers alike and range from simple automation of long standing business practices to complex real-time linkages enabled through internet. However, e-Sourcing is seen as one of the types of digital business, which is a critical element in building and maintaining competitiveness amongst the manufacturers as well as service providers.
8. e-Sourcing application enables streamlining of procurement processes such as non-value adding clerical tasks, bureaucratic authorization processes and excessive documentation that can be minimized and replaced by capturing of source data, integration of transactions in real-time and document management.
e-Sourcing processes supports networking to make the process more efficient by helping the sourcing professionals in making comparisons between suppliers about costs and past performance accurately in real time while simultaneously leaving an audit trail for future references and thus support the decision making of the sourcing managers to understand and analyze which sourcing options are the most effective to the instant requirement. If used correctly, different types of electronic tools enable the sourcing managers to focus more on important tasks such as supplier relationship management, sourcing strategy development and negotiations, which require much more time and effort, and are seen as value adding activities.
9. Even though, some forms of e-Sourcing and procurement systems have existed in market for almost two decades, many organizations are still hesitant in adopting different electronic tools for lack of awareness or resistance to change being human nature. However, gradually the industry has realized the power of
e-Sourcing tools and thus many organizations are now open to use of e-Sourcing systems. The digital era is one of the fundamental reasons behind the need for companies to evolve continuously to its sustenance in the market. Despite the wide range of e-Sourcing tools available in market, success of adoption of ibid electronic tools has its own share of success or failure aspects depending on how well the change management has been undertaken. Most of the times electronic systems and tools are implemented in the organizations, but in many cases the usage and naturally the benefits gained fall short from the expected due to poor planning in implementation stage and employees’ resistance to change which have not been managed in proper ways.
10. In order to succeed in the adoption of e-Sourcing, preparations for its successful implementation needs to be carried out in detailed manner. It is important to understand and analyze the most important factors that influence the process of electronic procurement adoption within an organization. In addition to carefully deciding on the correct e-Sourcing system itself and understanding the factors influencing the implementation success, thorough change management is required by understanding the lessons learnt from the forerunners of other digital business implementers. By applying best practices and minimizing risk factors, it is possible to successfully and proactively manage the change and implement the e-Sourcing system in the most successful way.