E-procurement Systems as Tools for the Development of Supply Chains

E-procurement Systems as Tools for the Development of Supply Chains

Cuauhtémoc Sánchez-Ramírez (Instituto Tecnólogico de Orizaba, México), Giner Alor-Hernandez (Instituto Tecnólogico de Orizaba, México), Guillermo Cortes-Robles (Instituto Tecnólogico de Orizaba, México), Jorge Luis García-Alcaráz (Instituto de Ingeniería y Tecnología Universidad Autónoma de Ciudad Juárez, México) and Alejandro Rodríguez-González (Centre for Plant Biotechnology and Genomics UPM-INIA, Polytechnic University of Madrid, Spain)
DOI: 10.4018/978-1-4666-2119-0.ch015
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Abstract

The Supply Chain Management is a strategy that has allowed the organizations that have established in their business models a competitive advantage. The supply chain is a network of elements, where different key process such as: procurement, manufacturing, distribution, inventory, customer services, and information should be managed and controlled to meet customer requirements. To achieve this goal, different tools have been developed to help to the key processes of the supply chain; one of these tools is the e-procurement system, which helps an organization to control the interactions with the most crucial suppliers.
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Introduction

Christopher (1998) considered to Supply Chain Management as new strategy in the business models. A supply chain is a network that enables the distribution options for procurement of both raw and finished materials, which can be transformed into finished goods and distributed to the end customer through various distribution channels. Commonly, the main goal of a supply chain is satisfy the customer’s requests as soon as they appear. To achieve the above goal it is necessary that the processes and key activities are carried out in a supply chain quickly and effectively. One of these processes is the procurement on line that with advances of technology has had a great develop in recent years. This process is well-known as e-procurement. E-procurement increases efficiency by reducing the cost of human resources in purchasing activities, but e-procurement is more than just a system for making purchases online, because a properly implemented system can connect companies and their business processes directly with suppliers while managing all interactions between them. It provides those who use it with a set of built-in monitoring tools to help control costs and assure maximum supplier performance. It provides an organized way to keep an open line of communication with potential suppliers during a business process. E-Procurement helps with the decision-making process by keeping relevant information neatly organized and time-stamped. Well-managed e-procurement helps reduce inventory levels. Knowing product numbers, bid prices and contact points can help businesses close a deal while other suppliers are struggling to gather their relevant data. E-Procurement systems that allow multiple access levels and permissions help managers organize administrative users by roles, groups, or tasks.

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