Procurement Process to Encourage E-Procurement Technology

Introduction

Recent developments and innovative ideas in technology and knowledge have challenged the industries, which is typically characterized by decreased performance, profitability, and sustainability within procurement processes (Adriaanse, Voordijk & Dewulf, 2010); (Lines, Sullivan, Smithwick, & Mischung, 2015). Industries like manufacturing, engineering, and construction must respond to new ideas and techniques because these industries contributing more than 10 percent to national income and play an important role in the growth of national economies (Santoso & Bourpanus, 2018).

The advent of the Internet has reshaped forms of information transmission, retaining and utilization within organizations to improve their competitive edge (Wimalasena and Gunatilake, 2018).

The growing significance of the internet platform provided opportunities for the implementation of EP, which is defined as using electronic applications to conduct procurement processes to boost profitability (Ramkumar and Jenamani, 2015). This illustrates the need for the organization to reform its traditional paper-based procurement activities (Costa and Tavares, 2014).

However, the frequency of adoption of EP in the manufacturing and ISO industries has been slow, although the advantages and modifications it offers to the overall procurement activities (Ramkumar & Jenamani, 2015; Aibinu and Al-Lawati, 2010; Ibem et al.

, 2016). Earlier studies have examined facets of EP, such as challenges or barriers and benefits and drivers ( Eadie et al., 2011; Wimalasen and Gunatilake, 2018; Nitithamyong and Skibniewski, 2004), but there is still a lack of systematic understanding of approaches to encourage the wider adoption of EP. Taking into account the environmental, social and economic impact of manufacturing processes and activities, the demand for sustainability is becoming immediate in the manufacturing and ISO industry on a global scale (Roman, 2017).

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For example, Wong et al. (2016) and Bohari et al. (2017) have reported that the large quantities of non-renewable resources and materials are being utilized by construction sector through its operations and practices, along with the production and shipment of construction materials that consume substantial amounts of energy results in producing high greenhouse gas (GHG) emissions. Nonetheless, public procurement has been continuously challenged to adhere to sustainable development goals by integrating economical, social and environmental requirements into the procurement operations so, Sustainable Procurement (SP) has been introduced to promote sustainability in public procurement (Walker and Brammer, 2011). SP is defined as providing procurement requirements and parameters that are consistent with environmental conservation, social change, and economic growth through asset performance, improved product and service quality, and life-long cost optimization (McMurray et al., 2017; Ramkumar and Jenamani, 2015).

While several countries, governments and agencies around the world have been encouraged to adopt procurement strategies and policies that provide goods and services which are environmentally sustainable (McMurray et al., 2017). Multiple dimensions, including green procurement methods, recycling, SP in the public sector and sustainable development activities, have been discussed in the literature (Eriksen et al., 2017; Meehan and Bryde, 2015; Walker and Brammer, 2011), but approaches and initiatives to ensure that SP is widespread and uniformly enforced within the organization are scarce in the literature.

Almost all of the studies performed on the two existing concepts in procurement, i.e. EP and SPP, considered implementing the two concepts independently (e.g. Al Yahya et al., 2018; Lim et al., 2018). This technique has resulted in a slow rate of adoption of both concepts (Aibinu and Al-Lawati, 2010; Wong et al., 2016), which hinders the ability to implement EP and SPP successfully and efficiently. Limited research has addressed possible relationships and cohesion between themselves (Bohari et al., 2017; Walker and Brammer, 2012). The theoretical applications of the two concepts earned no recognition from the researchers. For reference, Walker and Brammer (2012) study examined the relationship between EP and SP public procurement in multiple countries. Also, Ramkumar and Jenamani (2015) have shown the organizational buyer’s intention to accept of EP services integrating SP factors. However, the scarcity of systematic studies and incorporation mechanisms for the approach to promote the two study concepts raises a key question which this paper attempts to tackle are First, which approaches are appropriate for the promotion of these concepts.

Another question is how will these approaches be merged so extensively and then used to support the two paradigms. Therefore, the goal of this review analysis is to establish a collaborative framework for EP and SPP support approaches for sustainability in the procurement process in the organization. This review analysis contributes to research as well as in practice by establishing an integrated structure that allows business professionals, decision-makers and scholars to encourage EP and SPP in the manufacturing industry.

For business professionals and policymakers, this research offers a roadmap for strategic planning and decision-making on policies to facilitate the sustainable growth of EP and SPP in the ISO public manufacturing industries. Also, this research provides a forum for adopting the two concepts utilizing limited resources to gain their respective advantages. The components defined in the integration process directs the implementation of the future scientific research development strategy for the regular improvement of sustainable procurement.

Inspiration for the study

The past literature contains a variety of articles discussing the problems of EP and SPP. Whereas some empirical research ( AlNuaimi et al. 2019; Walker and Brammer, 2009; Thomson and Jackson, 2007) concentrated on technology growth for SP, another (De Boer et al., 2002; Angeles and Nath, 2007) looked primarily at the deployment and cost-effectiveness effect of EP in the organization.