Sharing e-gp Strategies & Approaches ( Korea Online e-procurement System)

Transcription

1 Sharing e-gp Strategies & Approaches ( Korea Online e-procurement System) December 19, 2006 SH Kang(bullseye@pps.go.kr) Public Procurement Service Government of the Republic of Korea

2 Contents Ⅰ. Overview of Gov t Procurement Ⅱ. Current Status of e-gov t Procurement Ⅲ. Concept of Korea Online e-procurement System (KONEPS) Ⅳ. Effects Ⅴ. Objectives Ⅵ. KONEPS Establishment Strategy Ⅶ. Expansion Strategy Ⅷ. Recommendations

3 I. Overview of Government Procurement I-1. Features of GP GP market share : 10-15% of GDP Principles of GP : transparency, accountability, fairness, open competition, non-discrimination GP is used as a means to support the economic policies of a country

4 I. Overview of Government Procurement I-2. Internat l Organizations for GP Government Procurement Agreement in WTO -Established in 1994 as a plurilateral agrmt with a view to opening the GP markets of member countries(38 as of Sept 2006) -Currently negotiations for revisions are under way, mainly for the purpose of lowering the threshold values and expanding coverage

5 I. Overview of Government Procurement I-2. GPEG in APEC -Government Procurement Experts Group which consists of 21 member economies in the Asia & Pacific Region - Adopting non-binding principles for GP (including value for money, accountability, etc) - Sharing information on GP system, whilst direct ing special attention to the progress made by the respective e-procurement systems of each economy

6 II. Current Status of e-gov t Procurement II-1. Effects of e-gp Enhance transparency in procurement -Digitalization has the expectation of ensuring that the procurement process is made more transparent and fair, leading to increase of accountability and the reduction of illegal practices Increase efficiency & cost-effectiveness -increased transparency results in increased efficiency by preventing improper pressure & corruption

7 II. Current Status of e-gov t Procurement II-1. Effects of e-gp Digitalization saves resources, while improving the rapidity of the decision-making process, leading to the increase of cost-effectiveness Enable equal access to the GP market -The e-procurement system guarantees that any qualified firm can participate in the bidding process since all information will be publicly available -This ensures full disclosure to any participants and reduces the possibility of irregularities

8 II. Current Status of e-gov t Procurement II-2. Other Benefits of e-gp Setting standards for e-market -Because Gov t is a big buyer in the national economy, and e-gp has e-commerce as its core system element, e-gp provides standards for private firms to learn from and refer to Inducing private sector to likewise adopt advanced techniques and systems

9 II. Current Status of e-gov t Procurement II-2. Other Benefits of e-gp -Firms will be compelled to use the e-gp system, if they wish to continue doing business with the government -As a result, the government can encourage private sector to adopt its more advanced techniques and systems by resorting to market principles and using economic incentives

10 II. Current Status of e-gov t Procurement II-3. Developmental Status of Countries e-gp Countries vary in the level of e-gp, ranging from top leader, intermediate, to least prepared groups as noted in the UN e-government Readiness Index There are still difficulties in working out standar dized e-gp system due to different status of ICT infrastructure in each country

11 III. Concept of KONEPS Concept Digitalization of the entire procurement process from purchase request, bid notice, contract, to final payment in the form of a single window All public organizations use the KONEPS One-time registration for all biddings and Integrated bidding information

12 IV. Effects of KONEPS Effects Lowered prices & decreased costs Better access to information and greater opportunities for businesses, especially small & medium-sized enterprises Enhanced transparency More efficient and convenient purchasing for public agencies

13 V. Objectives of KONEPS Efficiency. Innovating business process by procurement informatization Optimizing the amount of workforce and time by establishing a standardized business process Achieving on-time delivery through speedy and timely response

14 V. Objectives of KONEPS Transparency. Increasing transparency by business process standardization and openness Creating the environment for the optimal price by promoting participation amongst business and competition Obtaining the right products or services from responsive and reliable suppliers

15 V. Objectives of KONEPS Support for Business. Expanding the opportunity of business participation via a single window for bid notice Minimizing the business process and required documents by sharing common information Promoting business activity through prompt delivery and timely payment

16 VI. KONPES Establishment Strategy Concerns Need for overall change in procurement processes and practices Strategy Take step by step approaches to minimize errors Need for gov twide body to get various stakeholders involved Create gov t-wide single organization to promote project

17 VI. KONPES Establishment Strategy Need for legal framework to implement e-procurement system Need to reform the existing man ual process for smooth informatization Set up legal framework for KONEPS establishment Simplify the business process for informatization

18 VI-1. Step by Step Approaches to Minimize Errors Step G2B Innovation Plan [01.7] Setting up a Task Force to facilitate G2B transaction which comprises 9 Ministries Issuing a directive for preventing overlapping investment on e-procurement system Setting up the execution plan for innovation of procurement toward model design for e-procurement Completing BPR/ISP for establishing the e-procurement roadmap

19 VI-1. Step by Step Approaches to Minimize Errors Step System Building (02.2) Commencing system building after selecting a developer (US$24 million) Establishing the G2B system building T/F Starting KONEPS Test Service Official launching of KONEPS Beginning operation of KONEPS Call Center and user training Completing linkages to other external systems

20 VI-2. Integrated Body to Promote Project Due to the nature of procurement business involving many gov t agencies - Needed to revise laws, expand usage, and establish greater linkage to external systems Promoting system building through government-wide e-procurement implementation body

21 VI-2. Integrated Body to Promote Project Special e-government Committee Managing the 11 e-govt projects [procurement, civil service, education, medical service, tax] G2B Support T/F T/F to Facilitate G2B Transaction Review Group (54 institutions) Supporting - Revision of laws - Linkage and Standardization Composed of outside experts and govt officials General Coordination Team System Building Team Revision of Legal Framework DB Team Composed of experts: - User organizations - linked organizations Providing linkage method Practical test of the system

22 VI-3.1 Establishment of Legal Framework for KONEPS Prior to KONEPS, three Acts regarding e- Commerce and e-document were enacted, thus some basic legal foundation for KONEPS was already available General matters relating to KONEPS such as the validity of e-document were regulated by these Acts

23 VI-3.1 Establishment of Legal Framework for KONEPS Framework Act on e-commerce Recognizing the validity of electronic document and signature to promote e-commerce Digital Signature Act for expansion of e-documents Defining digital signature in order to recognize the validity of electronic document e-government Act for sharing the administrative information Requiring the use of electronic document in the works of government organizations

24 VI-3.2 Establishment of Legal Framework for KONEPS Procurement regulations prior to KONEPS had been designed for paper-oriented manual work, and not suitable for e-procurement establishment Thus, these regulations were revised to be e-procurement friendly for the promotion of e- Procurement (Sept 02)

25 VI-3.2 Establishment of Legal Framework for KONEPS 1. Revising regulations to expedite e-procurement including e-tendering To promote e-procurement, established a rule to execute all bids electronically 2. Setting up regulations for compulsory use of KONEPS Mandatory registration of bid notice, defaulting firms, and contract record Allowing purchasing agencies to use supplier information registered on KONEPS 3. Revising regulations to simplify procurement processes Exemption of submitting qualification evidence document required for bid participation Reduction of related documents for contract and other business

26 VI-4.1 Simplification of Business Process Streamlined business procedures thru elimination or reduction of traditional procurement processes inappropriate for the introduction of e- Procurement Among the business procedures (565) in the areas of purchasing, construction, and services, 152 unnecessary ones (152) were eliminated Among business procedures (565), those procedures (300) that needed improvement were modified to be suitable for e-procurement

27 VI-4.1 Simplification of Business Process Function Total processes Eliminated processes Modified processes Changed processes Purchase (80.2%) Construction (76.8%) Services (82.3%) Total (80.0%)

28 VI-4.2 Simplification of Business Process For the elimination of the inconvenience of submitting procurement-related documents, KONEPS has been connected to related information systems of other agencies Due to the KONEPS online linkage to various procurement-related agencies (surety insurance, certification-related agencies, banks), it became unnecessary for bidders or contractors to submit various documents in person.

29 VI-4.2 Simplification of Business Process Due to linkage to agencies` internal systems, employees of purchasing agencies` do not need to enter the same data into different systems repeatedly : once data has been entered into KONEPS, it is then exchanged and shared between KONEPS and internal systems. With linkage to other agencies` e- Procurement systems already in place, and as a result of bid-related information sharing, KONEPS contributed to the increase of business productivity and efficiency

30 VII. KONEPS Expansion Strategy Minimizing user resistance by operating customer satisfaction center Establishing Call Center upon the start of KONEPS services (Sept. 2002) Handling user questions about the system on a real-time basis - 75,000 cases during three months in ,000 cases in ,000 cases in 2004

31 VII. KONEPS Expansion Strategy Minimizing user resistance by operating customer satisfaction center Providing around-the-clock replies to user questions by telephone, , and PPS bulletin board Establishing the Web Call Center in 2004 for more advanced services - Screen-sharing between a web consultant and user for Q&A

32 VII. KONEPS Expansion Strategy Strengthening user awareness of e-procurement thru training programs Providing a mock bidding service for users to better adapt to KONEPS - Assisting users to experience and learn the system on their own Raising user awareness about the system by user education - Providing an education tour for employees of purchasing organizations and suppliers - Conducting nation-wide education at 22 e- Commerce Support Centers

33 VII. KONEPS Expansion Strategy Strengthening user awareness of e-procurement through training programs - Establishing education centers at PPS Head Office and regional offices for training of officials - Providing education for 23,000 users in 2003 alone - Directly visiting public organizations to provide education Distributing online education manuals via PPS website

34 VII. KONEPS Expansion Strategy Enhancing user convenience by sophisticating KONEPS (Sept.03~Sept.04) Providing tailored information through CRM service on a real-time basis - e-bidding notices, award information, certificate expiration, etc. Enabling mobile e-bidding service through the use of PDA - search for e-bidding information and participation in bids at anytime and from any location even when in transit Introducing Data Ware system to provide real-time information on KONEPS

35 VII. KONEPS Expansion Strategy Enhancing user convenience by sophisticating KONEPS (Sept.03~Sept.04) Expanding the connection with external systems, thus increasing the number of connected organizations from 34 to 77 in 2006 Achieving a One-Stop service for all procurement processes via KONEPS Handling documents through internet by digitalizing 166 types of procurement-related documents including bid, contract, and payment request

36 VII. KONEPS Expansion Strategy Securing user confidence in KONEPS by strengthening system stability & security Establishing the Back-up Center to guarantee a Non- Stop service (Dec.03) - Recovery services within two hours after the occurrence of a system error or failure Employing the PKI-based encrypting technology, thus eradicating any possible e-bidding related fraudulent activity

37 VII. KONEPS Expansion Strategy Securing user confidence in KONEPS by strengthening system stability & security Continuous increase of the use of KONEPS as a result Number of enhanced reliability Registered Purchasing agencies Registered Suppliers ,529 92, , , , ,129 e-bidding Execution 99, , ,779

38 VIII. Recommendations 1 Gov t leadership & commitment to e-procurement establishment - Gov t must fully understand the importance of e-procurement and support the project in terms of both legal and financial aspects

39 VIII. Recommendations 2 Setting up a govt-wide collaborative organization - - Organize a govt-wide task force involving related agencies Assign team leaders for decision-making, plan-execution, and intra-agency collaboration

40 VIII. Recommendations 3 Integrate related parties and share information Integrate related parties from purchasing agencies and sellers Create a strong collaborative relationship among these partners Full communication is the key to attaining the win-win result.

41 VIII. Recommendations 4 Standardize operation process for e-procurement - Review both current and new process for process efficiency - Reconfigure and eliminate process steps that can be improved or are redundant

42 VIII. Recommendations 5 Adopt a step- by- step approach - Start from the areas that offer the largest and fastest return-on-investment to demonstrate the value of e-procurement <In the case of KONEPS> Procurement EDI (1997) -> e-shopping Mall (1998) -> e-tendering (2000) -> Electronic payment (2001) -> Integrated e-procurement (2002)

43 VIII. Recommendations 6 Continually measure results and refine processes - - Continually evaluate performance and user satisfaction Seek out ways to further reduce expense and increase efficiency

44 Thank you KONEPS