CHAPTER 2: LITERATURE REVIEW
2.0
Introduction
The review of literature for the study was drawn from
journals, government publications, circulars, documents, books and newspapers
dealing with implementation of various E-Procurement project issues globally,
regionally and in Rwanda as a country. The literature review examines how
various studies have analyzed the concept of e - procurement, the effect of
implementation of e-procurement on the procuring entities that have adopted it,
the benefits and challenges that the procuring entities face as well as the
barriers to effective implementation of e - procurement. It also includes
theoretical framework, empirical review, conceptual framework and research
gaps.
2.1.
Understanding the concepts of e-procurement
2.1.1. Procurement
Procurement refers to the function of purchasing goods, works
or services from an outside body or private company (MAZIMA, E., 2020).Judith
G. and Arie S. (2001), defined procurement as «All of the activities
involved in obtaining material and services and managing their inflow into an
organization toward the end user.
Most of organizations and firms spend about one third of their
income for purchase services and goods (Gebauer J. & Segav, A., 2001). Even
some researchers as Kalakota and Robinson (1999) cited by (Caffey D., 2009)
stated that 50 to 60 percent of total revenue is being spent on purchasing
goods and services. Caffey, D. (2009) believes that in addition to purchasing
goods and services from suppliers, procurement includes inbound logistics,
warehousing and inventory management. Procurement includes actions related to
acquisition of services and goods and managing its flow toward the consumer
(Gebauer J. & Segav, A., 2001).
2.1. 2. E-procurement
E-Procurement is the use of Information & Communications
Technology (especially the Internet) by governments in conducting their
procurement relationships with suppliers for the acquisition of goods, works,
and consultancy services (RPPA, Intermediate level training module in public
procurement, April 2012).
Caffey, D. (2009) defines e-procurement as incorporating all
purchasing activities such as purchaser request, authorization, ordering,
delivery and payment by utilizing electronic means such as internet, web
technology and e-commerce. Electronic procurement system (EPS) is a system
which automats all activities in procurement process such as storing requests,
approval management, authorization and interfacing with company financial
system.
Josegarrido-saminiego et al. (2010), state that internet and
information technology has been applied to business strategy of most
organizations. One of the areas which have been widely influenced by
information technology is procurement. E-procurement is the outcome of applying
e-commerce to organization purchasing activities. Likewise according to
LindijaPulevska-Ivanovska (2004), the action of conducting procurement
operation electronically and paper-free is called e-procurement which consists
of whole operation of procurement such as requisition, approval, shipping, etc.
and not just buying process.
E-procurement encompasses «requisitioning, purchasing,
transportation and in-bound receiving process». It starts with requisition
for an item and ends with invoice payment. E-procurement is defined as
purchasing through internet and other information networks (Morrison, M.,
2009).E-procurement sites can be employed to purchase goods and services,
e-procurement software automates purchasing processes, controls inventory,
reduces purchasing costs and increases efficiency.
Dolmetsch et al. (2000) cited in Puschmann, T. and Rainer A.,
(2005), defines e-procurement as the indirect goods supply chain management by
using e-Markets and information technology. E-procurement is also one of the
specific areas which deals with external transactions enables improvement on
activities such as purchasing raw material and services by using internet and
web technology (Jason R. Eaton, 2003).
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