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In simplest terms, electronic procurement defines the automation
of an organization’s procurement processes using web-based applications.
Unlike
enterprise resource planning (ERP) systems that enable businesses to automate
their internal processes, e-procurement enables widely dispersed buyers and
suppliers to come together, interact, and execute purchase transactions directly
over the Internet.
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In a fully web-enabled e-procurement system, each step in
the procurement process occurs electronically.
From
creating and submitting POs to receiving and paying for
goods—all transactional data is automatically routed
through
workflow processors, reducing the time
and cost of procurement activities, and boosting
operational efficiency of the e-enabled organization.
E-procurement applications consolidate the paper-based catalogs
of multiple vendors by digitizing product information into a
single, one-stop shopping source for direct and indirect goods
and services. |
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In most cases, e-procurement applications are
transparent to end-users. Embedded in the business processes and
IT systems of buyers and suppliers, e-procurement applications
lower process and inventory costs, extend supplier reach, and
improve customer access to suppliers. |
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