contents 1.concept and service ………………….…………. 1 2.background of digitalization...

Contents

1. Concept and Service ………………….…………. 1

2. Background of Digitalization ……………………. 4

3. Operational Performance ………….……………. 7

4. Achievements …………………………………..... 9

5. Factors for Success ……………………..………16

6. Latest Achievements ….…………………………21

7. Comparative Study ….……………………………22

1.1 A Cyber Market for the Entire Public ProcurementA single website for public procurement

- GePS provides integrated bidding information including detailed specifications and criteria for the evaluations, etc

- One-time registration enables participation in all bidding

1. Concept and Service

Online transactions- All processes are digitalized from purchase request, bidding, contract,

to payment, and information is provided online

- Accessible to information of 58 other institutions whose systems are linked with GePS, and one-stop service is available

Just by connecting to the Internet, public organizations and private businesses can process their procurement work online based on the autonomy of each procuring entities.

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1.2 Internal & External System Architecture

Public Organizations

(Buyers)

PPS Operation

Private Businesses(Suppliers)

Use

Certification-Related agencies

Ministry of Government

Administrationand

Home Affairs

Construction-related

Associations

Korea Financial Telecommu-

nications& Clearings

InstituteSuretyinsurance

Ministry of FinanceAnd Economy

Construction CALS

Linkage

Portal

Integratednotice

Commercial products catalogue

Contracted productscatalogue

Goods classification

system

e-Procurement systeme-Procurement systeme-Procurement ASPe-Procurement ASP

Supplier supporting serviceSupplier supporting service

Unit contract systemUnit contract system

Linkage

User registration E-Guarantee

Supplier’s Performance E-Payment

Documents distribution and outside linkage


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Government contract

: Act on Contracts to which the State is A Party (ACSP)

- Regulations implementing ACSP: Executive orders, enforcement

rules issued by the Minister of Finance and Economy

- PPS has authority to interpret regulations regarding government

procurement and contract terms, starting from June, 2003

Local government, state-owned enterprises contracts

: subject to separate laws, but in most cases, ACSP is applied.

1.3 Legal Framework

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2.1 To Enhance Public Trust by Improving Transparency & Efficiency

2. Background of Digitalization

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PPS e-procurement (EDI, 1997~2001)

- PPS adopted EDI to initiate e-procurement

• As a centralized procurement agency, PPS accounts for 30% of the entire public procurement

• E-procurement applied to procurement of goods and to the online shopping mall in 1997, expanded to construction and services in 2000, and upgraded from EDI to XML based on the Internet in 2000

In 1997, we started with 20 public organizations as users

• In 2001, digitalization extended to all work including bidding, contract, and payment

e-bidding service were shared on request with the other organizations

- Per-capita productivity rose by 75%(from 280 to 489 cases annually)

2.2 Steps to GePS (1/2)


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Government-wide expansion (GePS, 2001~2002)

- Prompted as one of the 11 e-government projects

• Government-wide efforts made by creating a task force comprising relevant institutions and businesses

• Utilization enhanced by expanding participation and receiving various requests

- The GePS launched in October 2002 after the BPR/ISP for GePS started in July 2001

* BPR: Business Process Reengineering / ISP: Information Strategy Planning

- We built the DRS(Disaster Recovery System), DW(Data Warehousing), CRM(Cust

omer Relationship Management System), and Ubiquitous Service from 2003 to 2005.

2.2 Steps to GePS (2/2)


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200,000 users from 30,000 organizations(buyers) and 150,000

businesses(Suppliers)

- Jointly used by all organizations from the central and local governments

to state-owned enterprises including all entities be

longing to themselves

Records a daily average of 100,000 website hits, and exchan

ge 100,000 documents online which, in the past, were delive

red via mail or in person

3.1 Utilization Volume

3. Operational Performance

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93% of all biddings were conducted online

- 18 millions businesses participated in 120,000 biddings

amounting to US$ 25 billion

Construction materials, software and office supplies, which are

regular purchase items of public organizations, were ordered

by one-click purchasing in the shopping mall according to

the unit costs, which were contracted by PPS

- US$ 7 billion for 500,000 orders

Other transactions of US$ 11 billion including private contracts

were made electronically

3.2 Transaction Volume (US$ 43 Billion annually, FY2004)

3. Operational Performance

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Raised productivity

- Saved annual transaction costs of US$ 3.2 billion

• US$ 2.9 billion of business expenses was saved in terms of

time and transportation (US$ 0.3 B for public organizations)

Improved transparency

- Achieved a crystal clear administration by providing information in real time

and expanding the provision of information

• Promoted fair competition by expanding bidding opportunities

- Reduced face-to-face contacts between businessmen and officials

4.1 Enhanced Procurement Administration

4. Achievements

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“I can reassign the employees’ duty because of GePS from the paper or

routine work to management or sales divisions for more productivity…” (a

CEO of a private enterprise)

“Before GePS, the time required for participating in a bidding took at

least half day, but now… only 1 minute is enough for the same work.

Our company participated in bids 2,000 times a year…”

(a clerk of a construction company)

“I used to check the gazettes and newspapers at all times for

information, but now, I start my day surfing GePS with a cup of morning

coffee…” (a businessman in charge of sales )

Appendices – Public offering for descriptions of user’s experience

GePS Influence on productivity for businesses

4. Achievements

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“Before GePS, we sometimes formed collusion with our rivals for

prearranged bidding in front of the bidding place … But now the chances

of such irregular practices are virtually non-existent…” (a clerk of a

construction company)

“I used to visit the agency for the contract process, so I sometimes felt

uncomfortable, pondering whether I had to give a gift to my clients or

not, but now I don’t need to visit the client, so I am happy with the newly

changed situation…” (a businessman in charge of sales)


GePS Influence on transparency for businesses

4. Achievements

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GePS Influence on productivity and transparency for public organizations

4. Achievements

“Before GePS, in some cases, over 1,000 participants came to attend just

one bid… in that case regardless of their job positions, all members of our

agency had to support the execution of the bidding from the registration to

bid opening for several days… But now I can finish all of my work alone at

my PC in ten minutes… A total of 210,000 people participated last year…”

(a city-official in charge of procurement)

“Because of the peculiar characteristics of procurement arising from

conflicting interests, citizens had doubts about transparency, however hard

we may have tried… But now, most of the biddings are implemented by

GePS. I feel citizens’ trust improving…” (a city-official in charge of procurement)

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Expanded the experience of E-Commerce

- Public organizations and businesses accumulated the e-procurement

experience and utilized it for online transactions

- Created an environment for PCs and the Internet, and fostered

the mindset for e-Commerce

Improved the security of E-Commerce

- Facilitated the establishment of infrastructure for digital signature

and security including PKI encryption

* PKI : Public Key Infrastructure

- Accelerated the application of digital signatures to ensure security

for private sector transactions

4.2 Leading the Development of E-Commerce

4. Achievements

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Received with the Public Service Award (UN, Jun. 2003)

Evaluated as the best e-government

service provider (OECD, May 2004)

- A strong pull-through effect on ICT use in the

private sector and no further actions are required

4.3 World’s Best E-Government Operator

4. Achievements

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Reflected the standardized process in the UN global standard (UN/CEFACT, Mar. 2005)

- Registration → Public Invitation → Tender/Opening Tender →

Publication of Award

4.3 World’s Best E-Government Operator

4. Achievements

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Best practice model for e-procurement from around the world

(UN, “E-government Readiness Index”, Nov. 2004)

- Accentuated the integrated portal approach

The model policy export case for Korea- Benchmarked by many countries including developed countries such as

Japan

- International collaboration with Pakistani and Vietnamese governments’

e-procurement projects

5.1 Overcoming Weaknesses

5. Factors for Success

Obstacles Strategies

Need for inter-governmental cooperation

Established government-wide promotion system

Difficulty in integrating user inputs for providing user-friendly service

Activated user input at the initial developmental stage

Digital Divide Well-developed infrastructure

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5.2 Established Government-wide Promotion System

Operated an E-Government Special Committee as a top taskforce for building e-government (Jan. 2001 ~ Jan. 2003)

- Strong inter-governmental initiative

• The Committee assumed full management of e-government projects

• The President himself checked the progress of projects directly

through the committee

- Joint efforts by officials and private sector specialists in the Committee

• Public: Vice-ministers planning and budgeting

• Private: Specialists applying new ICT


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- 11 projects for e-government under the principle of Selection and Concentration

• GePS is one of the projects: including government-wide civil service, education, national finance, tax, social insurance, integrated personnel management, etc

Top budgetary priority for the e-government

Fiscal Year 1998 1999 2000 2001 2002

E-Government Projects

Budget (US$ M) 223 271 333 420 489

Change(%) - 21.3 23.0 25.9 16.6

TotalBudget (US$ M) 90,283 98,065 106,087 119,418 124,966

Change(%) - 8.6 8.2 12.6 4.6


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5.3 Integration of User Input

Best practice of collaboration

- Established the board of GePS development with 9 organizations under E-Government Special Committee

- A total of 90 organizations and businesses participating as a user or institutions linked with GePS

• Operated as advisory committees, trial boards, workshop members, etc

- Continuous practical training of users

• Built nation-wide education system for various organizations including regional offices and outsourced institutions

- Persuading users to promote voluntary use

• No more red tapes, no more corruption, no more waste of time, etc

Extension of use with PR


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- Ranked first in terms of Internet connection

• 30 million Internet users(65.5% of the population), 11 million

households with broadband Internet subscribers(75%), etc

- No problem occurred in e-biddings with 30 million participants

Bridged the Digital Divide among different regions

and companies

5.4 Well-Developed Infrastructure

Encouraged technology development of e-commerce

by legislating and revising laws

- Digital Signature Act (Feb. 1999), Framework Act on E-Commerce

(Feb. 1999), Electronic Promotion Act on Administration Processes for

the Establishment of an e-Government (March, 2001), etc.


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Face-to-face consultation services through a computer screen are provided by establishing Web Call-Center

Differentiated services are provided for each customer by introducing Customer Relationship Management (CRM)

6.1 Individually Customized Service(2004)

6. Latest Achievements

6.2 Focusing on the Ubiquitous Service(2005)

Mobile service channels shift away from the PPS homepage to wireless channels such as PDAs

Wireless e-bidding and property management through Radio Frequency Identification (RFID)

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- About 200 participants monthly through PDA

7. Comparative Study

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Pre Qualifications

Procurement Planning

Procurement Advertisement

Bidding

Selection of Successful Bidder

Closing of Contract

•Procuring agencies may engage in pre-qualification in case of service, civil work, turnkey project, expensive and technically complex equipment

Decision of Procurement

Performance of Contract and

Inspection

Opening of the Bids

Bidding Process

Project FS

Procurement Plan (package, types)

Bidding docs. For each package

Bid Announcement

Bid Opening

Bid evaluation

Review and approve bid results

Announce bid results

Each biddingprocedure

Project Procedure

Should be postedto the public byDecree 66 1.bulletin 2.website(future)

Contract

Closing of Contract

7.1 Standardized Process for Applying GePS Approach

Pakistan Vietnam

Integrate and share all information about government Procurement

Make a single e-Procurement system for all public organizations

Standardize procurement process and electronic document (XML)

with digital signature

Take the step-by-step approach from integrated bid information

and e-bidding

Need to make more clear rules and regulations according to the

reforming the process

7.2 Advices to Establishing e-Procurement System

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7. Comparative Study

Jae Yong Lee ([email protected])

Director of Information Management Team

Public Procurement Service of Korea

(www.pps.go.kr / www.g2b.go.kr)

Thank You