E-İŞLETME

All the definitions except E are among the definitions of procurement. The definition in option E refers to supply: The concept of supply is a process including the concepts of power and loot, in which there are different ways of obtaining something

E-trade is a process, in
which information exchange and communication
between people are provided without geographical
limitation. E-trade has played a considerably
important role in development of e- procurement

Needs Recognition
Procurement process begins with the recognition
of job needs and requirements. In a process, in
which a purchaser needs something, when any
difference is perceived between real case and desired
case, the procurement process begins by identifying
problems and determining the needs. This stage is
also qualified as a problem identification and needs
recognition stage

The next step in the procurement process is to
select resource/s (for the element demanded). In this stage, it is important to
select supplier resources which meet user demands

In this scope, in industrial procurements and
e-procurement, the process is executed as follows
(Zenz, 1994: 10-13; Dobler and Burt, 1996: 62).
• Needs Recognition
• Needs Identification
• Source Selection
• Price Comparison
• Placing an Order
• Order Follow-up
• Keeping Records
• Professional Supplier Relationship

Most procurement departments have responsibility to
confirm. Follow up is necessary for the seller to
place an order. It is necessary for the two parties to
agree on the price and conditions mutually and,
most importantly, it is necessary to deliver the
products as demanded.

In order to be successful in quality management, there are
four functions: identifying standards, assessment,
control, and security

E-procurement strategies
are examined in three groups; Wait and See Strategy, Passive strategy, Aggressive strategy

From another point of view, in a study carried
out by Peleg et al. (2002: 459), there are three
e-procurement strategies. The first strategy, in
which a business signs a long term contract with a
single supplier, is strategic partnership.

- EDI (electronic data interchange) Networks:
Large businesses, making connections through
special networks called EDIs (electronic data
interchanges) with their suppliers, provide time
and cost saving

Procurement expresses a process, in which a business or organization purchases goods from other businesses to perform its targets just in time and at lower cost (Quayle, 2006: 34).

Procurement is a process, in which all necessary materials, service, labor force, and information is supplied as outsourcing for businesses to be able to make their activities more effective and sustain their entities in the market (Weele, 2014: 9).

The car dealership conducting privately arranged business with the car rental company for courtesy vehicles rather than providing customers vehicles from the dealership fleet is an  inter-business e-procurement. For example, in Turkey, the vehicle manufacturer Fiat has an agreement for it's official dealers (Birmot) to procure courtesy cars from their partner and car rental company Avis. Avis thus provides the vehicles to Fiat customers because Fiat does not want to provide their own vehicles, and the Avis and Fiat systems are integrated with each other to simplify and manage this process.

The other choices are all market situations with multiple buyers and suppliers. Inter-business e-procurement is made in the form of goods and service supply and providing resources between two businesses through the internet (Turban et al., 2002: 217). Markets are institutional media, which provide customers and suppliers to announce their purchase and sale intentions. This can also be made official in a purchase or sale action and all relevant activities through the internet as real time. Business world and e-procurement are related to each other oneto-one. Markets bring together more than one purchaser and seller in a virtual market.

After a need is accepted, it should be accurately identified. This must be coordinated with inventory units and supply management. Inventory units evaluate the lists coming from procurement units according to the inventory control system of business. As a result of these, two main problems that may be experienced in procurement processes could be eliminated. (i) Is it in the warehouse now? First it has to be confirmed if the materials included in the need lists are in the warehouses of business now. This confirmation would eliminate unnecessary inventory.

After a need is accepted, it should be accurately identified. For providing adequate and perfect identification of needs, procurement personnel should have comprehensive information about elements and functions in the organization (Zenz, 1994: 11). Identifying the specifications of products or materials to be purchased has a great importance. These specifications will be identified according to the information that will come from the marketing department. Since the desires and needs of the final consumer are considered during the product design, information that will come from the marketing department play an important role in identifying the specifications and amounts of materials to be purchased. While specifications of products are generally identified their functional and technical specifications are also identified (Otterheim and Strand, 2007: 19-20).

Procurement can contribute to business performance in two ways. Procurement can lower costs or, helps to introduce products that are compatible with customers’ desire quickly which in turn makes it possible to increase sales.

Cost related performance measurement will contribute to the evaluation of procurement expenditures. Therefore, it is necessary to measure various elements of distribution cost for completing distribution between the different transportation and storing modes. ii) total storing cost: stock is one of the largest hidden costs for many businesses. Almost half of the existing assets of a business can be attributed to stock.

Procurement unit, making cooperation with suppliers, can develop both mutual relationships and innovation strategies both parts can utilize. Besides, cooperation and compliance that can be made with suppliers can affect quality level in producing products, and enables sustainable growth to be experienced. Thanks to cooperation with two parts, a trust environment is formed, and it makes contribution to developing innovative ideas (Monczka et al., 2009: 275). Based on the experience, material and consumption knowledge of suppliers, innovative products and ideas can be promoted by businesses. Suppliers play important roles from producing products to transporting them to the final customer. Therefore, it is necessary to find the best supplier and form sustainable relationships that will provide mutual benefit. 

An effective procurement management can be succeeded not only by reducing costs but also by supplying high quality products and materials. Purchasing low price products can be the first option but it should not be ignored that the quality of these products may be low. The main point here is to be able to have the appropriate quality at the proper price.

Procurement unit plays an important role in the relationships of business with its suppliers and undertakes the duty of the agent. From where and how businesses purchase its inputs are two important factors for the prestige of business. Avoiding the activities that will leave negative effects on the society and consumers such as employing child labor and polluting natural environment is important for businesses.

Since procurement plays a mediatory role between suppliers and production, it can make a contribution to developing product designs. It was observed that businesses that included its suppliers in product design and decision stages were more effective on average 20% in the input cost, input quality, and product development process (Monczka et al., 2009: 7).

This is an example of a united strategy, in which a supplier is used as a long term partner, however, a second resource can be selected through the internet.

First Generation Commodity Exchanges are information and content centers. E-procurement applications stand out the developed B2B portals called commodity exchange. This exchange contains functions such as online trade magazines, industrial news and trends, product information, classified contents of sectoral participants, and technical examinations. The aim of B2B commodity exchanges is to create a market for all participants without permitting the prevailing interest of any participant in the exchange market.

One of the biggest obstacles to rapid adoption of e-procurement is the gap between expectations about how the two parts of the process, suppliers and buyers, behave in the market. On the one hand, purchasers adopting e-supply, due to more largely adopting just-in time applications, shorter order cycles, increase of contribution of suppliers to product development, etc., gradually become more dependent on suppliers.

In a study carried out by Davila et al. (2003: 13), there are four special e-procurement technological models as e-procurement software, market change, inter-business open biddings, and procurement consortiums.

Attaran and Attaran (2002: 18) divide advantages of e-procurement into three different categories. These are institutional changes and strategic advantages that are related to market advantages; opportunity advantages, developed with the existing and even new suppliers and related to discovered relationships; and operational advantages meaning cheaper and more effective procurement processes. The contents of advantages presented in this way are:

Strategic Advantages are in the way of

• Realizing procurement applications that will provide more discount and better service,

• Accelerating information flow between purchasers and suppliers,

• With reducing administrative hours, directing staff to the other tasks, and

• Accelerating participation in new markets, where competition is high, and reaction to competitors.

Opportunity advantages are

• Developing business image and institutional trade relationships,

• Developing purchaser-supplier relationships,

• Possibility to access to more accurate information.

Operational Advantages

• Facilitating financial audition

• Eliminating document costs

• Providing that personnel and supervisors follow movements of orders through the system, increasing supervision and security.

• Shortening delivery time by eliminating the need to wait for paper documents by mail

• Removing impediments of time slice

• Reducing inventory levels.

• Reducing workload, cycle time delays, stocks and errors, increasing effectiveness in each stage

• Allowing for flexible access in every time and every place

• Providing delivery in time