Brazil's E-Procurement System - Essay Example

Running head: Brazil's E-procurement system Introduction The phrase e-government was introduced by the United States national performance review in the year 1993 and it soon spread to other parts of the world. Initially, it was seen as a tool for the richer countries but in the recent past, even developing countries have adopted it due to its efficiency and effectiveness. ICT an acronym for information communication technology is used while implementing e-procurement and e-government in an area. Most government and businesses are using e-procurement in their daily businesses and transactions. E-procurement refers to the business to business, business to government or business to consumer sale and purchase of goods, service or work via the internet and other networking systems like the enterprise resource planning and interchange of electronic data. E-government has been on the rise in different countries with most government using internet as a means of improving their services to their customers. As most companies as well as governments embark on e-procurement, different and important issues have been raised in regard to its use in a country. E-government unlike in the past where it was an option, it has become a necessity especially as countries strive to achieve better governance and efficiency in offering services to the citizens. E-governance requires the government to integrate the strategic vision in service delivery to the citizens. ICT is today being used with an aim of streamlining the governments thus connecting it closely to the citizens thus ensuring better services are being offered by the governments. E-government as well as e-procurement is also vital in ensuring that public funds are managed well by a government thus enhancing efficiency and effectiveness. Different countries for example Brazil have recently adopted e-procurement and e-government in their administration. Although Brazil is in its early stages in e-government application, the use of this technology in most of the ministries in the government have led to tremendous improvement in their functioning and especially in the management of public funds (Miller, n. d). Use of e-procurement and e-government in Brazil As mentioned earlier, use of e-government and e-procurement in Brazil has led to improvement in the functioning of the government especially in the area of public funds management. The agenda for e-government first appeared in the federal government of Brazil in the year 2000 which was later implemented in most of the ministries of the government. However, use of e-procurement has raised significant issues in the recent past. One of the major issues which have been facing the Brazilian government which carrying out e-procurement is the issue of security. The government has some confidential information which should not be disclosed to the public or unauthorized persons. Use of e-procurement exposes the government to the risk of losing important information especially as internet crime and terrorism acts are on the rise. This may put the government as well as the citizen under the risk of terrorism attacks. The issues of security while using e-procurement have been a major issue for the Brazilian government in its endeavours to ensure e-government is practiced. To cub or reduce this problem, the government have installed security measures to ensure that no unauthenticated person gets access to sensitive information. Security remains a major and important issue while dealing with e-procurement (Neef, 2001). Personification of the government is also another important security issue which should be considered while implementing the e-procurement and e-government systems in any country. Since all transactions are carried out online, it is very possible for a person to fraudulently rob of any government especially through e-procurement. While using the internet, the financial information concerning a person or a government is availed to ensure smooth transactions are carried out. However, there are possibilities of the information being accessed by the wrong individuals which could cost the government thousands of dollars. E-procurement also raises issues of standardization of prices and markets. While using the e-procurement system, it is difficult for the government to compare different prices being offered in the market unlike in the traditional method of purchasing where negotiations were inevitable. There are possibilities of the government purchasing goods at a higher cost than it could have in an open market system. Brazil was also faced with this problem while implementing the e-procurement system in the country (Obi, 2007). Another issue which has been facing the Brazilian government over the use of e-procurement and e-government is the cost of implementing the technology in all public sectors. As mentioned above, Brazil is in its initial stages of implementing the technology in the country and thus the cost of implementing it is very high considering that there are no adequate infrastructures to sustain or even support the e-procurement technology. Lack of skilled staff has also been a major hindrance to the successful implementation of the e-procurement technology in the country (Miller, n. d). There are different reasons as to why governments implement or adopt e-procurement while dealing with the public sector. One of the major reasons of employing e-procurement in the public sector is to reduce the unit cost of products or services. In the normal physical transaction, a government may be required to deal with different individuals in the chain of supply thus increasing the costs of goods and services. Apart from dealing with the intermediaries in the supply chain, the government also has to pay for the transportation costs and the purchasing process is also too long which at times leads to delays. Use of e-procurement has helped in reducing such inconveniencies and costs. The use of e-procurement in Brazil has helped in reduction of procurement costs as well as the bureaucracies involved while dealing with public goods purchasing. Also, this practice has also enhanced government's accountability and transparency while dealing with purchases and sales. In Brazil, COMPRASNET is the e-procurement system which has been put in place by the government in the ministry of planning, budget and management. Through this system of procurement, online quoting of prices is enabled which also helps in reverse auction of commodities purchased. Under the COMPRASNET system, all organizations owned by the federal governments are required to register any procurement needs that may arise during the course of carrying out their duties. The system in turn informs all the suppliers who are registered through emailing them. The supplier thus can download all the documents required for the bidding process. Goods which are classified under the category of commodities can be traded online or through the internet through a system of price quoting for a span of two to three days following the posting of the purchase. The system of price quoting is usually done through a non competitive means as it is usually for smaller purchases. However, for procurements that are large classified as general purposes services and goods, a procedure of reverse auction is used. The purchases of such items are carried out through competitive bidding with suppliers reducing their bids until the lowest bidder is identified. This process has led to some sort of standardization in the e-procurement system of the government while at the same time ensuring that the government purchases goods at fairly competitive and lower prices. Also, the goods which are obtained are of higher quality and reduced costs (Almeida, n. d). Ease of use is also another reason which encouraged Brazil to engage in e-procurement and e-government. Unlike in the traditional procurement where a government if it wanted to purchase certain goods from the private sector it had to contact and even meet in person the supplier. However, with introduction of e-procurement there is no need of arranging for a physical meeting with the supplier as all the purchasing and sales are carried on in the internet. This has made the purchasing processes easier for both the Brazilian government as well as the local suppliers. The Brazilian government has also benefited from e-procurement in that this system has enabled it to purchase quality goods and services which have been made possible by the orderly requisition process. Before the implementation of the e-procurement system, the requisition process was disorderly and long which at times led to the procurement of defective goods. Return of such goods also took long through the bureaucratic measures thus long procedures. However, with the introduction of e-procurement the government is able to ensure that all the goods ordered are in good shape and in case of any defects; such goods can be returned more easily than when using the traditional procurement strategies. Apart from ensuring that goods are in good shape, this system also makes sure that the citizens needs are successfully met or catered for. Use of e-procurement in Brazil has thus led to more cooperation between the government and the citizens especially while dealing with procurement and allocation of public goods (Zouridis & Thaens, 2003). E-procurement and e-government in Brazil has also helped in reducing corruption in the country. In the past, the citizens were not empowered in any way to make suggestions or comments regarding some of the government officials. Citizens had to wait for long periods before being served or attended by a government official. Also, feedback on the performance of these government officials was rare. With introduction of e-governance, employees can be served online by the government officials and they can also give feedback on the kind of service an official offers. E-government enables the citizens to interact with the government officials online thus people do not have to travel to the official's offices or even premises. E-procurement in Brazil has also led to a partnership relationship to be developed between the public sector and the private sector thus enhancing the overall growth of the economy of the country. This has enhanced the relationship between the public and the private sectors thus ensuring accountability in the public sector. While working on itself, the public sector is marked by bureaucracies which in turn hinder effective carrying out its roles especially due to lack of accountability and transparency. By encouraging e-procurement, the private sector is in a position to oversee or track the transactions of the public sector mainly because they work in one on one basis thus ensuring that transparency and accountability are enhanced by both the sectors. Brazil has been a major beneficiary of this kind of a relationship between the private and the public sector in the country (Miller, n. d). Governments' initiative of installing e-procurement and e-government may not always meet the needs of the citizens of a country especially because such initiatives are not always effectively communicated to the people. In Brazil however, the process of e-government was well communicated to the citizens and the government even took the initiative to install internet connections to almost all homes in the country. However, this did not necessarily mean that the public's needs were met and/ or even satisfied. Using the example of the COMPRASNET system of procurement, the government aims at checking the public expenditure thus affecting the citizens. Also, the bidding process especially for the large quantity procurement is complicated which the citizens cannot comprehend. The main goals of the citizens are to see a government which can protect them by being accountable and transparent in its entire doings. The Brazilian government has been trying to reach this goals but the cost of implementing e-government and e-procurement has been costly bearing in mind that Brazil is a developing country with huge population amounting to almost 150 million people (Almeida, n. d). Conclusion Most corporations and governments have embarked on e-procurement and e-government to ensure accountability, transparency, effectiveness and efficiency while carrying out their daily chores. Unlike in the past where e-procurement was meant and e-government were meant for rich and developed countries, today these practices are being carried out throughout the entire world. However, despite the benefits that e-procurement has, there are important and critical issues which have risen like the security of important information and treatment of intellectual property. The issue of citizens needs have also been raised while dealing with e-procurement and e-government. Any government while employing or installing the e-procurement and e-government should ensure that such systems are meeting the needs of the citizens which include protection, sound governance, transparency and accountability. References: Almeida, M. O. (n. d): Success/Failure of e-Procurement by Brazil's Federal Government. Retrieved on 29th April 2009 from, http://www.egov4dev.org/success/case/brazeproc.shtml. Miller, S. (n. d): E-Procurement Initiatives. Retrieved on 29th April 2009 from, http://ezinearticles.com/E-Procurement-Initiatives&id=274666. Neef, D. (2001): E-procurement: from strategy to implementation. ISBN 0130914118, Published by FT Press Obi, T. (2007): E-governance: a global perspective on a new paradigm. ISBN 1586037765, Published by IOS Press Zouridis, S. & Thaens, M. (2003): E-Government: Towards a Public Administration Approach. Asian Journal of Public Administration Vol No 25 Read More