eProcurement

in South Africa

November 2009

Content

• The Journey

• Business Requirements

• Solution Offering

The Journey

The Integrated Financial Management System IFMS project is the lead phase of a priority

initiative led by the National Treasury to review and upgrade Government’s transverse

information technology (IT) systems. The objective of this project is to enhance the integrity

and effectiveness of expenditure management and performance reporting in order to

ensure effective service delivery.

• Transverse systems are defined as the general administrative systems required by all

Provinces and Departments which include:

• Financial management systems

• Human resource & payroll management systems

• Integrated supply chain management systems

In 2005 a cabinet memo was approved that these transversal systems namely Supply

Chain Management, Human Resources, Finance and Business Intelligence should be

replaced, this included all the procurement management systems of the government.

IFMS Project Overview

The IFMS project is the establishment of an integrated information system solution (ERP

type) for government supporting the full government business cycle from strategic

planning through operational planning & budgeting, implementation and in-year reporting

to end year reporting.

It is an important component of the

government’s initiative to improve service delivery

to the citizen through standardised and

integrated business processes, information,

governance and reporting.

Supply Chain Management Framework

The following business processes form the key operational functions for Supply Chain

Management as described by legislation to manage all of governments goods and services.

Supply Chain Management Policy Framework

– Demand Management

– Acquisition / Procurement

Management

– Logistics / Inventory

Management

– Disposal Management

– Performance Management

Procurement Framework

The following business processes form the key operational functions for Procurement

Management as described by legislation. This includes the unique requirement s for supplier

rotation and the evaluation of tenders according to the preferential points system.

– Procurement Options

– Supplier Management

– Contract Management

– Order Management

– Performance Management

IFMS Architecture

This IFMS architecture diagram gives an indication of the different ways to access the solution

which allows for new innovative ways for government to interact with the public.

Business Requirements

• Business Standards

• Corporate Reference Data

Codification

In order to enable the control and management of national and provincial codification data tosupport the business requirements a codification policy framework was established to

address the following through the introduction of standards.

Accurate and uniform management information

– Cross governmental visibility on all expenditure

– Allow for consolidated planning across government

Effective expenditure control and optimisation

– Avoiding unnecessary inventory build-up

– Lower purchase prices due to economies of scale through strategic sourcing

– Transparency of supply costs

Enhance integrated supply chain operations through effective management

– Quicker identification of supply items and services

– Ability to share information between departments

– Cross service supply optimisation

– Supplier performance management

The objective of corporate reference data is to support Governmental systems by being

an integrated “Source of Truth” in terms of referenced data to provide consistent

aggregated Business Intelligence.

Business Functions:

• The realisation of Government Policies

• To provide a consistent set of reference data and functions

• To enable information aggregation within Government

• Information exchange and systems integration

– Gov-internal and

– External;

• To supports data quality, already when data is created

• Promotes software reusability

• Eliminates data duplication and

Corporate Reference Data

Solution Offering

One of the key functional offering within the IFMS procurement solution is the supplier

portal which will open up a communication channel to suppliers allowing them to interact

actively within the following areas of the procurement process:

• Purchasing

• Receiving

• Invoice and Payments

• Supplier Information Management

Solution Offering

Purchasing:

•View supplier agreements

•Acknowledgement of purchase orders

•Submit change requested electronically

•View purchase orders including along with invoice and receipts history

•Manage contract deliverables

•View contractor time cards

Solution Offering

Receiving:

•View delivery schedules

•View receipt history

•View returns and inspection results

•View overdue receipts

•Delivery performance

Solution Offering

Invoice and Payments

•Capture and view invoice information

•Support dispute resolution

•View payments received

Supplier Information Management

•Supplier on-line registration

•Enable suppliers to maintain their own information

•Enable suppliers attach mandatory documents

•Provide visibility on their purchase orders, invoices and payment

Next Phase

Inventory Management

•Record inventory at hand

•Have minimum stock levels

•Link to reordering

•Maintenance and repairs

Demand Management

•Populate procurement plans

•Link to Budgets

END