e-procurement – supplier take-up is still the problem

I received a comment from a reader - writing his thesis on e-procurement - referring back to one of my articles article on IT Adviser "e-procurement's missing link - supplier adoption”, and agreeing that supplier adoption needs to be successfully addressed.

Although that article was written a few years ago, its message still rings true today. From the authorities that I’ve been in contact with lately, supplier adoption remains at the top of the list of factors preventing the realisation of the full benefits of e-procurement.

Commercial organisations have tended to use their commercial strength (“if you want to remain a supplier to us you must use our e-commerce facilities”) to ensure speedy take-up by their suppliers, but many authorities seem unable to go down that route as their political leaders are (possibly rightly) against using compulsion of this sort. However, given the potential savings in LA back office costs, I would argue that all major suppliers to a LA should be compelled to go down this e-commerce route.

For smaller suppliers to local authorities, I have long supported the principle of the carrot rather than the stick in this area. LA’s should encourage their suppliers to adopt the LA’s e-commerce systems through offering tangible benefits, not forcing them to pay to join a supplier database, and certainly not just the promises that some LA’s project.....

Yes – it may cost LA’s in the short term, but the long term benefits of having the majority (all?) of their suppliers using e-commerce fully, will vastly outweigh the short term costs.