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GOOD GOVERNANCE IN PUBLIC PROCUREMENT: AN EVALUATION OF

THE ROLE OF AN E-PROCUREMENT SYSTEM


by
Rajesh Kumar Shakya
CATHIE WITTY, PhD, Faculty Mentor and Chair
CHERISE MOORE, PhD, Committee Member
JOAN VERMILLION, PhD, Committee Member
Elizabeth Koenig, JD, Dean, School of Public Service Leadership

A Dissertation Presented in Partial Fulfillment


Of the Requirements for the Degree
Doctor of Public Administration

Capella University
June 2015

Rajesh Kumar Shakya, 2015

Abstract
The outcome of public procurement reforms being carried out in most developing
countries is negligible and has not provided significant support for good governance in
the procurement sector despite having sound objectives with the initiatives. Presently,
most of the governments around the world are implementing e-government procurement
(e-GP) systems as a tool for public procurement reform for better governance in the
public procurement sector. The implementation of e-procurement has been accepted as
one of the most promising and feasible options for governments in delivering enhanced
governance in the acquisition of goods, works, and services for the public sector. This
action research analyzed the implementation of the e-GP system in a developing country
using quantitative and qualitative methods of data analysis following the utilizationfocused evaluation framework. The study focused in the utility of the e-GP system,
addressing different dimensions of good governance and emphasizing transparency,
accountability, corruption control, efficiency, effectiveness and predictability, easy
access, rule of law and equity, and civil society awareness. It studied the users
perception about the role of the e-GP system in public procurement good governance, the
users attitude towards e-GP system use, and the e-GP systems impact on good
governance. The research revealed that an e-GP system significantly enables and
enhances good governance in the public procurement sector. The research indicated that
an e-GP system can be fully leveraged for enhancing good governance if, among other
things, a comprehensive e-GP system implementation framework is followed with
adequate planning, phasing of implementation is based on the procurement cycle basis

rather than an incremental functional basis, and the e-GP system addresses all the key
aspects of good governance rather than focusing only on 1 or 2 aspects in isolation.

Dedication
I dedicate this dissertation to my dear wife, Dr. Dhandu Rani Shakya; my son,
Ayush; and daughter Ayusha, without whose encouragement, strength, support, and
enduring patience, the completion of this dissertation would not have been possible. In
addition, I always feel blessings from my late dad and mom, and support from my sisters
and brother.

iv

Acknowledgments
This dissertation came to this shape with the tremendous help and support of
many people. I would first like to thank my mentor and committee chair, Dr. Cathie
Witty, for all of her advice, motivation, and patience she gave me throughout the
dissertation process. I would like to extend special thanks to my committee members, Dr.
Cherise Moore and Dr. Joan Vermillion, who kept me honest and insisted that I go that
extra mile to make the dissertation precise and clear. I sincerely thank Tanka Mani
Sharma and Naresh Kumar Chapagain for facilitating environment, and Bhim Khatiwada
in the survey field test and coordinating the participants of the focus group discussions. I
also want to thank all the respondents from public entities, and procurement officers and
bidders of this study for providing valuable advice. I also want to thank several
colleagues, including V. S. Krishnakumar, Knut Leipold, S. M. Quamrul Hassan, Dr.
Paul Schapper, and Hunt La Cascia for keeping me motivated.

Table of Contents
Acknowledgments

List of Tables

ix

List of Figures

xii

CHAPTER 1. INTRODUCTION

Introduction to the Problem

Background of the Study

Statement of the Problem

10

Purpose of the Study

13

Rationale

13

Research Questions

16

Significance of the Study

17

Definition of Terms

19

Assumptions and Limitations

24

Conceptual Framework

25

Organization of the Remainder of the Study

32

CHAPTER 2. LITERATURE REVIEW

34

Brief History of Procurement

34

Public Procurement Reforms

34

Objectives of Public Procurement

37

CHAPTER 3. METHODOLOGY

46

Action Research Evaluation Approach

46

Research Design

55
vi

Sample

57

Instrumentation

59

Data Collection

61

Data Analysis

62

Ethical Considerations

65

CHAPTER 4. RESULTS

68

Site Description

68

Research Methodology Applied to Data Collection and Analysis

69

Analysis, Synthesis, and Findings

70

Data Collection

84

Survey Results

87

Two-Way Analysis of Variance Test

95

Focus Group Discussions

98

Summary

114

CHAPTER 5. DISCUSSION, IMPLICATIONS, AND RECOMMENDATIONS

116

Revisiting the Problem

117

Discussion of Findings, Implications, and Recommendations

118

Implementation and Incorporation of Action Research Outcomes

134

Conclusions

136

Limitations of the Study

141

Recommendations for Further Research

143

Summary

145

REFERENCES

147
vii

APPENDIX A. RECOMMENDED E-GOVERNMENT PROCUREMENT


SYSTEM FEATURES

158

APPENDIX B. VALIDITY AND RELIABILITY ANALYSIS TABLES

165

APPENDIX C. FRIEDMAN/CHI-SQUARE TEST ANALYSIS AND


MULTIVARIATE ANALYSIS TABLES

176

APPENDIX D. STUDY FEEDBACK AND RECOMMENDATIONS

188

APPENDIX E. E-GOVERNMENT PROCUREMENT IMPLEMENTATION


FRAMEWORK

193

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List of Tables
Table 1. Reliability Analysis for Dimensions of Good Governance Factors

73

Table 2. Summary of Good Governance Construct Results

84

Table 3. Study Respondent Demographics

85

Table 4. Two-Way Analysis of Variance Test on Research Questions and


Underlying Hypotheses

96

Table B1. KaiserMeyerOlkin Measure and Bartletts Test Data for Transparency

165

Table B2. Communalities for Transparency

166

Table B3. Total Variance Explained for Transparency

167

Table B4. KaiserMeyerOlkin Measure and Bartletts Test Data for Accountability 168
Table B5. Communalities for Accountability

168

Table B6. Total Variance Explained for Accountability

169

Table B7. KaiserMeyerOlkin Measure and Bartletts Test Data for Corruption
Control

169

Table B8. Communalities for Corruption Control

170

Table B9. Total Variance Explained for Corruption Control

170

Table B10. KaiserMeyerOlkin Measure and Bartletts Test Data for Efficiency,
Effectiveness, and Predictability

170

Table B11. Communalities for Efficiency, Effectiveness, and Predictability

171

Table B12. Total Variance Explained for Efficiency, Effectiveness, and


Predictability

171

Table B13. KaiserMeyerOlkin Measure and Bartletts Test Data for Easy Access

172

Table B14. Communalities for Easy Access

172

Table B15. Total Variance Explained for Easy Access

173

ix

Table B16. KaiserMeyerOlkin Measure and Bartletts Test Data for Rule of
Law and Equity

173

Table B17. Communalities for Rule of Law and Equity

174

Table B18. Total Variance Explained for Rule of Law and Equity

174

Table B19. KaiserMeyerOlkin Measure and Bartletts Test Data for Civil
Society Awareness

175

Table B20. Communalities for Civil Society Awareness

175

Table B21. Total Variance Explained for Civil Society Awareness

175

Table C1. Friedman Test Results for Transparency

176

Table C2. Friedman Chi-Square for Goodness-for-Fit Test Results for Transparency 177
Table C3. Friedman Test Results for Accountability

178

Table C4. Friedman Chi-Square for Goodness-for-Fit Test Results for


Accountability

178

Table C5. Friedman Test Results for Corruption Control

179

Table C6. Friedman Chi-Square for Goodness-for-Fit Test Results for Corruption
Control

179

Table C7. Friedman Test Results for Efficiency, Effectiveness, and Predictability

179

Table C8. Friedman Chi-Square for Goodness-for-Fit Test Results for Efficiency,
Effectiveness, and Predictability

180

Table C9. Friedman Test Results for Easy Access

180

Table C10. Friedman Chi-Square for Goodness-for-Fit Test Results for Easy Access 180
Table C11. Friedman Test Results for Rule of Law and Equity

181

Table C12. Friedman Chi-Square for Goodness-for-Fit Test Results for Rule of
Law and Equity

181

Table C13. Friedman Test Results for Civil Society Awareness

181

Table C14. Friedman Chi-Square for Goodness-for-Fit Test Results for Civil
Society Awareness

182

Table C15. Multivariate Analysis of Variance: Descriptive Statistics

183

Table C16. Multivariate Analysis of Variance: Tests

184

Table C17. Multivariate Analysis of Variance: Tests of Between-Subjects Effects

185

xi

List of Figures
Figure 1. Objectives of e-procurement.

27

Figure 2. Conceptual framework of study.

30

Figure 3. Utilization-focused evaluation interaction.

48

Figure 4. Three user groups of an e-procurement system.

58

Figure 5. Structure of study survey questionnaire.

60

Figure 6. Marginal means of dimensions of good governance.

97

Figure E1. E-government procurement implementation framework.

195

Figure E2. E-government procurement readiness assessment.

197

xii

CHAPTER 1. INTRODUCTION
Introduction to the Problem
Procurement policies establish the practice of procurement to apply methods and
public financial resources that produce the best social and economic outcomes, within a
value set that is ethical, nondiscriminatory and transparent. This establishes the objectives
of public procurement in terms of principles that includes value-for-money, transparency,
open and effective competition, nondiscrimination, accountability and due process. In the
opinion of Veiga Malta, Schapper, Calvo-Gonzalez, and Berroa (2011), these principles
describe both the ends and the means of public procurement.
The underlying concept is that good governance in public procurement sector
exists when public money is spent for the right purpose aiming to procure with the right
quality, right quantity, and right price at right time and place from the right source.
Morita and Zaelke (2005) stated that many factors play an important role in
socioeconomic development but good governance is now recognized as playing an
essential role in the achievement of sustainable socioeconomic development of a country.
The authors also agree that good governance is supported by clear decision-making
procedures at the level of public authorities, civil society participation as well as the
ability to enforce rights and obligations through legal mechanisms.
Governance is a broad and inclusive concept that covers formal as well as
informal spheres of life in any human society, emphasizing the importance of compliance
1

with such ethical virtues as transparency, equality, fairness, responsibility, accountability,


participation, responsiveness to the needs of the people, and efficiency in the
management of public fund. Good governance refers to the process and structure that
insures good management of resources (Asian Development Bank, Inter-American, Bank,
& World Bank, 2004). Good governance promotes and requires the rule of law,
upholding such dimensions of the good governance as transparency, accountability,
participation, effectiveness, efficiency, predictability, fighting corruption, consistency,
and coherence (Kaufmann, Kraay, & Zoido-Lobaton, 1999; Organization for Economic
Co-operation and Development, 2006; United Nations Economic and Social Commission
for Asia and the Pacific, 2009).
Public procurement is one of the sectors that require attention in terms of good
governance as it is directly related to the expenditure of public funds. It is common that
e-procurement is one of the major interventions taken by many governments as an
innovative enabler for good governance in public procurement. For the purpose of this
action research, the e-procurement is operationally defined as the collaborative utilization
of information and communications technologies (especially the Internet) by government
agencies and other actors in procurement community in conducting all activities of the
government procurement process cycle for the acquisition of goods, works, and services
with good governance in public procurement (Shakya, 2012). A common government
procurement process cycle includes the processes starting from the demand aggregation,
procurement planning, selection of procurement methods, preparation of bidding
document, invitation to bids, bid submission, bid opening, bid evaluation, contract
awards, contract management, payment processing, and contract closure. Procurement
2

principles are generally provisioned through the Public Procurement Act and detailed
processes, methods, and rules are devised in the Public Procurement Regulations.
Presently, most of the governments around the world implement e-procurement
systems as a tool for public procurement reform for better governance in the public
procurement sector (Callender & Schapper, 2003; Wittig, n.d.). This action research was
rooted in the recognition that despite having sound objectives with public procurement
reform initiatives, and significant resources invested for that, the reforms are negligible in
most developing countries. Developing countries are characterized by low and middle
income (World Bank, 2013), low levels of industrialization, poor infrastructure, slow in
technology adoption, widespread illiteracy, and poor living standards among their
populations as a whole (Al Moalla & Li, 2010).
One of the reasons they are getting fewer results could be that the potentials of eprocurement systems are not fully utilized, and the procurement sector could not obtain
significant support for a sustainable framework for good governance from the policy
level (Ladipo, Sanchez, & Sopher, 2009). Hence, this action research analyzed the
implementation of the e-procurement system in one of the developing countries in terms
of its utility addressing different dimensions of good governance by measuring the users
perception about the role of the e-procurement in public procurement good governance,
their attitude towards its use, and finally the impact on good governance. The research
problem relates to all public development issues as public procurement deals with public
funds, and the direct impact would be for the public entities spending public money, the
bidders (goods suppliers, works contractors, service consultants) participating in

government procurement contracts, and regulatory/oversight agencies for regulating and


overseeing such interventions in public procurement.
The e-procurement supports the social control of public expenditure through its
different online measures of public transparency (De Almeida, 2002). Rotchanakitumnuai
(2013) supported the theory of good governance through the research that a transparent eprocurement process has a positive effect on good governance practice, increasing costeffectiveness and accountability, and decreasing collusion among suppliers. This action
research will improve the e-procurement system and its implementation practices for
enhancing the good governance in public procurement sector by providing feedback and
recommendations for use through the analysis of the perception of its users and level of
utilization of e-procurement system. The outcomes of the action research may also help
other countries more successfully implementing e-procurement systems.
Background of the Study
Several seminal studies have been conducted on separate aspects of eprocurement implementations on individual case bases. As noted in those studies, there is
lack of effective e-procurement policies and practices to meet the stated objectives
(Concha, Astudillo, Porrua, & Pimenta, 2012; Vaidya, Callender, Sajeev, & Gao, 2004).
Most of the implementations did not consider adequate efficiency gain (both in terms of
value and risks) of e-procurement implementations, and did not address the required
simultaneous changes (business process reengineering) in the organization and strategy
(Trkman & McCormack, 2010), or the lack of serious planning on performance model for
perceived impacts (Gardenal, n.d.).
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Neupane, Soar, Vaidya, and Yong (2012) believed that the proper e-procurement
management can reduce government corruption. Lee and Lee (2012) observed that the
decisions needed for enhancing good governance are inadequate, untimely, and not based
on feedback systems, knowledge, experience, and country environment. Adequate
attention to the e-procurement has not been given because of the conflict between the
technical and political requirements, and interests of the implementing countries.
The conduct of public procurement has often reflected tensions between public
expectations of high standards of governance, management requirements for
performance, and overt (and covert) political influence and pressure from broader
stakeholder interests such as business. In many jurisdictions there is often conflict
between procurement regulations (or lack of) intended for transparency and risk
mitigation versus environment designed for achievement of outcomes and broader
policy objectives. (Curtin University of Technology, 2007, p. 20)
For the last 2 decades, e-procurement systems have grown rapidly in different
countries. One of the major factors that drive this trend is the political commitment by
many governments to increase public procurement transparency (European Parliament
and the Council, 2004). Most of the previous systems were developed with a focus on
efficiency, not transparency. The web-based procurement-related information portal did
not necessarily extend its functionalities to improving procurement management and
streamlining the workflow processes of procurement (Carayannisa & Popescu, 2005;
Organization for Economic Co-operation and Development, 2005).
The efficacy, utilization, and completeness of e-procurement mainly impact the
bidding communities (suppliers of goods and services, contractors), citizens, society,
government procurement agencies, and regulatory/oversight bodies.
If the perceived benefits of an e-procurement system are not achieved, the
stakeholders lose their faith in reform process and uphold the status quo in terms of
5

improving governance in the public procurement sector. If e-procurement works well, it


is expected that it decreases corruption, increases efficiency, effectiveness, and
accountability, and promotes transparency and rule of law. All bidderslarge and
smallare treated equally, competitiveness is increased, major stakeholders and civil
society are well informed about public procurement, and the overall governance in the
procurement sector is enhanced.
E-Procurement and Principles of Good Governance in Public Procurement
E-procurement has proven itself to be one of the more effective and efficient tools
for bringing good governance to the procurement process in many countries, and eprocurement initiatives have received significant support from the donor community
including the World Bank, the Asian Development Bank, the Inter-American
Development Bank, and the African Development Bank (United Nations, 2011). There is
agreement about the following core principles of good governance according to the
Organization for Economic Co-operation and Development (2006a), United Nations
Economic and Social Commission for Asia and the Pacific (2009), and the World Bank
(Kaufmann et al., 1999). These core principles of good governancetransparency,
accountability, participation, rule of law, effectiveness, efficiency, predictability, fighting
corruption, proportionality, consistency, and coherenceare also applicable to public
procurement. Public procurement is an important function of government (Thai, 2001)
and has to satisfy requirements for the procurement of goods, works, and services in a
timely manner. Furthermore, it has to meet the basic principles of good governance:
transparency, accountability, and integrity (Callender & Schapper, 2003; Wittig, n.d.).
Schapper, Veiga Malta, and Gilbert (2006) stated that in jurisdictions in which the
6

dominant political concern has been the principles of transparency, equity, and fair
dealing, management of public procurement through an extensive regulatory framework
often constitutes the status quo.
The Multilateral Development Bank, comprising the Asian Development Bank,
the Inter-American Development Bank, and the World Bank, are using an electronic
government procurement readiness assessment developed in November 2004 to conduct a
high-level review of its procurement environment and determine the level of readiness in
the country to make a smooth transition to e-procurement. The implementing countries
already feel that the instrument should be updated.
The joint World Bank and Organization for Economic Co-operation and
Development Assistance Committee Procurement Round Table initiative, developing
countries, and bilateral and multilateral donors developed a set of tools and standards
Organization for Economic Co-operation and Development methodologythat provide
guidance for improvements in procurement systems and the results they produce
(Organization for Economic Co-operation and Development, 2006a) but does not cover
e-procurement. Similar to the Organization for Economic Co-operation and Development
Assistance Committee, the World Bank also uses the country procurement assessment
report to assist its member countries in analyzing their present procurement policies,
organization, and procedures.
Concha et al. (2012) proposed the comprehensive e-government procurement (eGP) observatory maturity model, which aims to satisfy four e-GP high-level
requirements, for each participant agency:

Identifying its current state of maturity and capability in an integral, multiaspect manner

Comparing itself with other governments evaluated with the same model

Building a feasible improvement roadmap to improve its levels of capability


and maturity

Informing policymakers about its readiness for integration with other egovernment initiatives, and defining improvement programs when required

The e-GP observatory maturity model provides the guidance only for the start-up
activities to be carried out by the governments before implementation of the e-GP system.
This action research considered the e-GP observatory maturity model while developing
an e-GP implementation framework, which was one of the outcomes of this research.
Country Focus on the Aspects of Good Governance
There are many possible factors contributing to the issue of good governance.
Governments in developing countries are taking e-procurement as an introduction of
information and communications technologies in the government. Such intended or
unintended focus taken by the governments in implementing e-procurement systems
could be the reason of fewer outcomes (Ladipo et al., 2009). Another possible factor may
be the lack of clear policy of the government on the use and practice of e-procurement.
Asiimbwe (2012) reported news citing the observation of a procurement expert in
Uganda, saying, Lack of clear policies is hindering the use of e-procurement in Uganda
(p. 1). She noted that it is a challenge to build and sustain relationships with entities,
which are not prepared to go online, and small businesses not enabled for e-procurement.
On the other hand, the Government of Bangladesh has issued a Guideline for eGovernment Procurement clearly explaining the policy as well as procedures and
8

practices for the use of e-GP. As the result of such clarity, the current e-procurement
implementation trend has experienced an upsurge beyond projections, which is resulting
in a more positive procurement environment.
Curtin University of Technology (2007) pointed that many countries are focusing
merely on cost saving by the use of e-procurement than their focus on enhancing overall
good governance. The author indicated another problem may arise from the deployment
of e-procurement system without adequate business process reengineering of the
traditional procurement processes and practices before introducing into the eprocurement. One of the reasons could be that little attention has been paid to the need
for periodical measurement of the e-GP systems performance and goal satisfaction
(Concha et al., 2012, p. 550) as well as not considering the e-procurement in systemic
manner as a mainstream tool which can enhance the comprehensive dimensions of good
governance in procurement sector. Curtin University of Technology (2007) listed the key
lessons learned by most of the countries, which relate to ensuring

Effective government leadership and management of the implementation plan


Comprehensive user buyer and manager awareness and training so they are
confident to use the systems and their initial concerns have been addressed
Supplier awareness and training must be addressed.
The potential e-procurement environment is assessed and the information used
in developing the implementation plan.
The transition from paper- to electronic-based processes is planned and
supports the need to change the process.
Legislative support, especially identified by South American countries (p. 27)

Therefore, this action research project contributes to the improvement of


employee organizational behavior as well as stakeholders involved in public procurement
process. This action research establishes the importance of taking a systemic or holistic
approach when introducing e-procurement system taking adequate measures to include
9

and support all aspects of good governance that seamlessly link with the principles of
public procurement. The action research follows a utilization-focused evaluation of eprocurement implementation in one of the developing countries using a contribution
analysis framework (Patton, 2012b), to analyze the country-based lessons on eprocurement as they relate to implementation around the world.
Statement of the Problem
Not only in the Public Procurement Monitoring and Regulatory Agency of the
research site country but also in any other countries, there is no evidence of academic
studies or practitioner evaluation that have attempted to assess the role of an eprocurement system in enhancing good governance in the public procurement sector by
applying an integrated and comprehensive model of research including the application of
good governance standards. Additionally, there is incomplete knowledge of the
underlying attitudes, perceptions, and knowledge of any dimensions that could have an
impact on good governance for the public procurement sector.
If good governance in the procurement sector is not effective, it could lead to poor
strategic country development as most nations spend about 20% of gross domestic
product on public procurement (Callender & Mathews, 2000; R. Carter & Grimm, 2001),
and developing nations spend up to 50% (Schiavo-Campo & Sundaram, 2000, p. 315).
E-procurement in the site country was started by the comprehensive study by the
Asia Foundation (Shakya, 2003). This study focused on feasibility and challenges, and
prepared a roadmap for e-GP implementation in the country. An e-GP readiness
assessment conducted in 2007, even before the procurement monitoring and regulatory
agency was established, assigned the country a reasonable score of 2.22 out of 4 in level
10

of readiness. The major influence on this score was the lack of an appropriate lead agency
to drive and sponsor this procurement reform, according to the World Bank; however,
several building blocks for the implementation of e-procurement in the country are
already in place.
Internet connectivity is available in almost all government administrative
premises up to local level, and a significant number of rural community centers, cybercafes, and business centers are established across the country with information and
communications technologies facilities. Currently, the public procurement and
monitoring agency is established and strongly fulfilling its mandate of governing public
procurement sector in the country including the introduction of a unitary national eprocurement system. By this time, the journey of e-procurement in the country has come
a long way, but still needs a clear strategy to take the initiative forward.
In an earlier discussion, Shakya (2003) noted that a lack of transparency in
government procurement has been a systemic problem in public procurement reform. In
addition, inefficiency due to manual and paper-driven procurement processes has resulted
in poor service and low sales volume (p. 54). The study found that establishing an eprocurement system could help improve transparency, efficiency, and value-for-money in
government procurement. Stakeholders (government agencies and suppliers) showed
their support for the e-procurement concept following this study, stating that
The government should capitalize this concept and encourage community to go in
the direction of e-procurement. The strategy should recognize that there are
elements of risk, which are unavoidable. If the full benefits of e-procurement are
to be realized it should be managed very cautiously. The implementation of the eprocurement strategy will face a number of potential barriers and challenges. To
help the change processes take place, key areas of concern have been identified
and ways to address those potential issues noted. (Shakya, 2003, p. 54)
11

The public procurement regulatory and monitoring agency, as per the mandate of
the 2007 Public Procurement Act and 2008 Public Procurement Regulations, started the
phased development of centralized e-GP system. Phase I (from the procurement process
of preparing annual procurement plan up to e-bid submission functions) of this system
were already rolled out in 2012; however, there were gaps, which are addressed by the
Phase II (with the functionalities of e-bid opening, e-evaluation, e-payment, contract
management, and procurement management information system) recently being
implemented.
The e-procurement system in the country is conceived as an Internet-based single,
central, and collaborative government procurement platform for all the public
procurements by the government. All the stakeholders in the procurement process get
appropriate access using their secured user name and access codes, and will have private
secured working dashboards. Direct users of the system are all the public procuring
entities, bidders, and the public procurement regulatory and monitoring agency and other
government oversight entities, tertiary service providers enabling services of eprocurement, and maintenance service providers and the general public.
Presently, most of the governments around the world are implementing the e-GP
systems as a tool for public procurement reform for better governance in this sector
(Callender & Schapper, 2003; Wittig, n.d.). The research problem explored in this study
is rooted in the fact that despite having sound objectives of public procurement reform
initiatives with significant resources investment, the outcome of reforms in most of the
developing countries is negligible as noted earlier, because the potential of e-GP systems
are not fully used and do not have significant support for a good governance framework
12

(Ladipo et al., 2009). This action research studied and analyzed the full utilization of the
e-GP system in the country in terms of its role in enhancing good governance, and
included all available different functions, processes, practices and available technologies.
Purpose of the Study
The purpose of this research was focused on evaluating the utilization of the eprocurement system that contributes to good governance in public procurement
(emphasizing compliance with ethical virtues on public procurement as transparency,
accountability, corruption control, efficiency, effectiveness and predictability, easy
access, rule of law and equity, and civil society awareness) in public procurement.
Findings will enhance improvements in the e-procurement system use and its
implementation to deliver better public service through e-procurement.
Rationale
There is a vacuum of research-based knowledge base on the role of e-GP in terms
of addressing good governance agenda of the public procurement reform. Chvalkovsk
and Skuhrovec (2010) explored the Transparency Index in public organizations as an
influence of the e-procurement implementation. Ermal and Miranda (2012) studied the
efficiency of the Albanian e-procurement system in the reduction of corruption in public
procurement practices. A Curtin University of Technology (2007) Multilateral
Development Bank surveyonly one survey so far on e-procurement systems in
Asia/Oceania, South America, and Europewas carried out as part of a project of the
Multilateral Development Bank Harmonization of e-Procurement Group. This survey
aimed only to provide information for jurisdictions that were at the inception stage of
13

implementing e-procurement and was designed to provide information on e-tendering, ereverse auctioning, and e-purchasing systems in relation to

System functionality achieved

The governance, business, management, and technical issues that were


addressed in the transition to e-procurement

The costs of development or acquisition, and implementation of the systems


and the annual costs to operate and maintain the systems

Benefits recognized by stakeholders

Outcomes and outcome measures

Success factors and lessons learnt

Other observations as appropriate

The Curtin University of Technology (2007) Multilateral Development Bank


survey did not study any areas of goal satisfaction on good governance aimed by the
public procurement reform initiatives and the contribution of e-procurement in better
governance in public procurement.
The reasons to implement e-procurement are to achieve one or the other
combinations of maximum good governance objectives in public procurement. Despite
having sound objectives of public procurement reform initiatives, the tools and
instruments are not sometimes properly designed to meet such objectives. Although an eGP system is quickly becoming an essential agenda of national e-government programs,
because it enables active transparency and favors efficient vendor relationships, little
attention has been paid to the need for periodical measurement of e-procurement portals
performance and goal satisfaction (Concha et al., 2012). It is now imperative that eprocurement systems are analyzed to find out whether adequate measures were taken in
14

their design and whether the desired goals of good governance in public procurement
initiatives have been achieved.
This research chose to focus on the good governance aspect of the e-procurement
system in one of the developing countries, because this issue is especially important in
the developing countries, in which public funds are significantly abused under the cover
of public procurement. Using good governance as the focus for the study provided
meaningful insight into possible problems with the implementation e-procurement
systems in the country. The main site for the research is the public procurement
regulatory and monitoring agency of the site country.
There have not been other studies on the study of perception on the role of eprocurement systems in contributing to good governance in an integrated system.
Therefore, results gained through a study done in the site country will strengthen and
facilitate research on e-procurement systems in other countries with similar situations.
This action research supports improving the accountability of government
officers, efficiency in the procurement process, reduction of corruption, and creation a
favorable environment for bidders to participate in government businesses (contracts)
with trust and confidence; it also promotes the enhancement of good governance in
public procurement by analyzing the gaps in current implementation and practice.
These outcomes are possible through an ongoing collaborative process between
the research facilitator and the program stakeholders working within their focus groups to
evaluate the programs resources, gather data, evaluate findings and execute the
recommendations (Patton, 2012a).

15

Through the utilization-focused evaluation survey and focus group discussions on


the e-procurement implementation, changes will emerge as stakeholders connect with the
challenges in the system, providing them with clear vision for change and improvement
in e-procurement service operations geared to long-term good governance.
Research Questions
The seminal researchers over the last 15 years have shown that the introduction of
some forms of e-procurement has helped improve transparency, efficiency, and cost
saving, while reducing corruption in public procurement. Nevertheless, despite the
proliferation of literature touching on theory and practice, most of the research focused
on some influences within the general behavior of e-procurement systems. Therefore, in
spite of all of these studies focused on separate aspects of the system, there is a gap in
studies considering e-procurement as a mainstream and integrated tool to reform public
procurement and enhance good governance in the public procurement sector. To achieve
good governance, it is important to identify the perceptions of the stakeholders working
within the e-procurement system and their contributions to good governance in all levels
of the total system to finally assess the best practices of e-GP.
This research analyzes the perception of the key stakeholders along a variety of
dimensions of good governance working within the operating e-procurement system.
The key research questions were
1. How useful is the e-procurement system in enhancing good governance in
public procurement?
2. Does e-procurement add value to public procurement?

16

A survey was conducted to collect data under seven sets of questions to assess
perceptions about the relationship e-procurement within the operational objective
dimensions of good governance: transparency; accountability; corruption control;
efficiency, effectiveness and predictability; easy access; rule of law and equity; and civil
society awareness.
The survey also collected demographic data of the respondents such as age group,
respondent type, years of e-procurement use, and annual participation in e-procurement.
The survey was designed to identify the best practices e-procurement governance and the
required measures of intervention in e-procurement systems for the benefits of good
governance.
Significance of the Study
The study of the role of e-procurement system in enhancing good governance in
the public procurement sector holds an immense significance in e-procurement domain
globally. The results of the study should provide insights and guiding framework for the
public procurement regulatory and monitoring agency of the site country as well as
global public procurement community in case of the perception, attitude, and knowledge
to improve the e-procurement implementation. The study analyses current setting of
practices, gaps, challenges in an e-procurement system, and provides insights on
improvements to be made to overcome the good-governance-related inconsistencies.
In order for research to provide meaningful outcomes, the researcher analyzed the
available theoretical concepts and international practices. The following aspects represent
the key significance of the study:
17

Integrated approach of good governance factors coverage in e-procurement


system implementationThe significance of this study outstands from the
other studies is based on its approach to see the problems from the point of
view of contribution of e-procurement system in enhancing good governance
in totality. It does not attribute individual factors in isolation for the good
governance in public procurement. The simple reason for taking an integrated
approach is that if e-procurement is implemented just for the enhancement of
transparency, or efficiency, or cost saving in silos, then remaining
fundamental principles of public procurement will have to be addressed in
traditional manner. All the procurement processes and factors of good
governance are strongly interlinked. Inadequate focus on each of key
governance factors imbalances the public procurement sector, and practices
become inefficient. This study analyzes the impact of fragmented
implementation of the e-procurement system in the country, and intends to
establish a theory that a comprehensive and integrated approach of eprocurement system implementation enhances good governance in the public
procurement sector.

Redefined approach of phasing to cover procurement cycle in e-procurement


system implementationThis action research redefines the phased
implementation of e-procurement system. Despite many scholar literatures
recommend phased implementation of e-GP implementation as one of the
essential requirement for the success of e-GP system, it appeared from the
research that the phased approach of implementations were mainly focused on
incremental approach through the implementation of facilities step by step by
improving the website functions: (a) provide procurement-related information
through an information portal on procurement, (b) publish procurement
notice, (c) publish procurement notice with bidding document download
option, (d) publish contract awards, (e) allow to upload bid document in PDF
format, (f) publish annual procurement plan, (g) provide facility of e-bidding,
(h) monitor procurement performance through electronic procurement
information management system in-built in e-GP, and (i) provide basic
contract management functions.
The e-procurement system implementation approach without having
implemented complete set of key processes is lengthy and raises significant
amount of rework moving from one stage to another. This approach is not
favorable for achieving desired target. This research establishes the theory that
if phase implementation is planned, the phase should be designed in such a
way that it demonstrates the effectiveness of implementation and integrity of
the process of procurements. Phasing is not effective if few functions are done
electronically and other functions of the process are done in manual system.
Functions and tools in e-procurement system should be available to complete
one procurement logical cycle.

18

Result-oriented action research based on utilization-focused evaluationThis


action research is based on utilization-focused evaluation and follows the
process recommended by Patton (2012a). Significance of the study is reflected
in the corrective actions taken by the public procurement regulatory and
monitoring agency in the site country in Phase 2 of the e-procurement
implementation.
The chosen country for the research spends 60% of its total annual budget
in public procurement, which highlights the urgency for good governance in
public procurement.
The government of the country has initiated the implementation of a
national level e-procurement system as one of its interventions for the good
governance in public procurement sector. The regulatory and monitoring
agency is the implementing agency for the pilot implementation of the first
phase of e-procurement system that began in May 2013. The pilot involved 13
nominated agencies. The outcome of the project and the utilization-focused
evaluation enabled the public procurement regulatory and monitoring agency,
and other intended users to improve the implementation and use of eprocurement system by designing an intervention to create change (Patton,
2012a, p. 57). According to Ramirez and Broadhead (2013), [utilizationfocused evaluation] evaluators facilitate a learning process with attention to
how real people in the real world might apply evaluation findings and
experiences. In designing a utilization-focused evaluation the attention is
constantly on the intended use by intended users (p. 1). As the action is the
only way to generate and test new social science knowledge, the evaluation
findings in participation of intended users were prepared as the classified
recommendations for use. The regulatory and monitoring agency has
prioritized the research evaluation recommendations under Strategic and
Operational categories so that the use of findings becomes more manageable.
Most of the recommendations have been implemented in the rollout version of
the second phase of e-procurement implementations in the country.

Contribution to international communityOne of the outcomes of this action


research is the e-GP implementation framework. The e-GP implementation
framework is developed based on the research, lessons learned in the site
country for the research and other countries, and international best practices.
The e-GP implementation framework and the evaluation framework can be
used as a model for other countries.
Definition of Terms

The definitions of terms discussed as follows are presented to show how these
terms are defined within the scope of this study:
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Accountability. Accountability means that officials are responsible for the actions
and decisions that they take in relation to procurement and for the resulting outcomes,
and secondly that their actions and decisions are transparent (Commonwealth of
Australia, Department of Finance and Deregulation, Business Procurement and Asset
Management Group, 2013).
Civil society awareness. To ensure accountability, transparency mechanisms such
as public oversight and monitoring, are important. Civil society can play an important
role in raising awareness around public procurement and other areas of public financial
management (Jeppesen, 2010). According to Kpundeh (2004), the aim of this awareness
raising is to exert political pressure and pressure to the public officials to use public
resources only for the benefits of citizens, not for their private purposes (p. 259).
Corruption control. Corruption in public procurement relates to the awarding of
public procurement contracts to a preselected supplier to the detriment of the public
interest through violation of the principles of competition for the purpose of gaining
personal benefit (Pashev, Dyulgerov, & Kaschiev, 2006). Of all government activities,
public procurement is most vulnerable to corruption.
The favoritism with regard to a specific supplier, which is harmful to the public
interest, can be observed anywhere from the smallest day-to-day supplies to the
biggest tendering procedures directly supervised and controlled by senior
government officials. The personal benefit can take the form of cash, power, jobs
in the private or public sector, and so on. (p. 5)
Easy access. Building the capacity of bidders has been identified as one of the
success factors of public procurement reforms. Many bidders are limited in various
capacity issues including lack of basic knowledge in the law, inadequate capacity to
appreciate the standard tender documents, poor access to tender information and
20

insufficient technical and managerial skills to be competitive in the tendering process


(Osei-Tutu, Mensah, & Ameyaw, 2011). Easy access to procurement information
empowers the bidders, and can provide quality and competitive bids to the government.
Effectiveness. Effectiveness relates to how well outcomes meet objectives. It
concerns the immediate characteristics of an agencys outputs, especially in terms of
price, quality and quantity, and the degree to which outputs contribute to specified
outcomes (The Australian National Audit Office, 2010).
Effectiveness can be achieved by ensuring that the property or service being
sought will make the maximum possible contribution to the relevant outcome. This
entails correctly identifying the need, accurately drafting functional specifications,
rigorously assessing responses and negotiating the final contract, and then diligently
managing the contract. Comprehensive monitoring and assessment at all stages of the
procurement process further contributes to effectiveness (The Australian National Audit
Office, 2010).
Efficiency. Efficiency relates to the productivity of the resources used to conduct
an activity in order to achieve the maximum value for the resources used. In relation to
procurement, it includes the selection of a procurement process that is consistent with
government policy and is the most appropriate to the procurement objective under the
prevailing circumstances (The Australian National Audit Office, 2010).
Efficiency in procurement is enhanced by conducting transparent, fair and
appropriately competitive processes of a scale commensurate with the size and risk
profile of each particular project.

21

E-government. E-government is a form of e-business in governance and refers to


the processes and structures needed to deliver electronic services to the public (citizens
and businesses), collaborate with business partners and to conduct electronic transactions
within an organizational entity (Backus, 2001).
E-government procurement (e-GP)/e-procurement.
There are various definitions, which often hinge on the difference between eprocurement and e-tendering. In the private sector, e-procurement is often used to
mean the technology that supports the postcontract award purchase-to-pay or
transactional cycle. E-tendering is then used to describe the technology used
around the precontract award phase, the category management or strategic
sourcing cycle - supplier selection, tendering, and contract management. (Smith,
n.d., p. 5)
E-procurement is operationally defined as the collaborative utilization of
information and communications technologies (especially the Internet) by government
agencies and other actors in procurement community in conducting all activities of the
government procurement process cycle for the acquisition of goods, works, and services
(Shakya, 2012).
Equity. Equity promotes nondiscrimination. All potential suppliers to government
must, subject to procurement rules, be treated equitably based on their commercial, legal,
technical and financial abilities and not be discriminated against due to their size, degree
of foreign affiliation or ownership, location, or the origin of their goods and services
(Australian Government Department of Finance, 2014).
Good governance. Good governance promotes the rule of law, upholding the
dimensions of the good governance, such as transparency, accountability, participation,
effectiveness, efficiency, predictability, fighting corruption, consistency, and coherence

22

(Kaufmann et al., 1999; Organization for Economic Co-operation and Development,


2006a; United Nations Economic and Social Commission for Asia and the Pacific, 2009).
Governance. A wide and inclusive concept that covers formal as well as informal
spheres of life in any human society, emphasizing compliance with those ethical virtues
as transparency, equality, fairness, responsibility, accountability, participation,
responsiveness to the needs of the people, and efficiency in the management of public
funds.
Predictability. Standardization always helps in ensuring fair competition,
reducing abuse and improving predictability in procurement outcomes (Vajpey, 2010).
Procurement planning and transparency enhances the predictability of the procurement
process, so that the bidders can plan their resources beforehand (Lynch, n.d.).
Public entities/procuring entities. Public entities are the government agencies,
departments and units, authorized to spend public money for the procurement of goods,
works and services. In some countries, procuring entities are called contracting
authorities, procuring agencies, public entities, or purchasing agencies. For the sake of
this study, the terms procuring entities and public entities are used interchangeably.
Rule of law. Many institutions identify a fair, impartial, and accessible justice
system and a representative government as key element of the rule of law. In this study,
the term rule of law is applied for the enforcement of the Public Procurement Act and
Public Procurement Regulations to strengthen the compliance across all the public
procurements the fair and equitably, equally, consistently, coherently, and prospectively
to all stakeholders (Morita & Zaelke, 2005).

23

Transparency. Transparency is a primary consideration throughout the


procurement process. The general principle is that sufficient and relevant information
must be made available to all interested parties consistently and in a timely manner
through a readily accessible, widely available medium at no or reasonable cost
(Australian Government Department of Finance, 2014). This general principle is
applicable to all aspects of government procurements. Transparency is established when
all aspects of procurement in an entity are available for appropriate
scrutiny/review/audit/reference.
Value-for-money. Value-for-money is the core principle underpinning public
procurement. Value-for-money is a comparison of relevant benefits and costs on a whole
of life basis. Value-for-money can be achieved by encouraging competition in
procurement bidding among bidders, promoting the efficient, effective, economical, and
ethical use of resources, through highest level of accountability and transparency,
encourage appropriate engagement with risks and being commensurate with the scale and
scope of the business requirement (Australian Government Department of Finance, 2014;
Commonwealth of Australia, Department of Finance and Deregulation, Business
Procurement and Asset Management Group, 2013). Procurement practices and
procedures must be directed to achieving the best available value-for-money in the
acquisition of goods and services to deliver, or support delivery of, government
programs.
Assumptions and Limitations
This action research was conducted to assess the initial stage of e-procurement
system implementation and the creation of good governance standards in the site country
24

chosen for this research through the survey of stakeholders involved in public
procurement activities in the country. As a result, the findings from the surveys may not
be generalizable to other globally strategic implementations of e-procurement systems.
Additionally, implementation approaches are different in different countries, and this also
limits the generalization of any findings to larger strategic levels. The research effort
focused on sampled number of participants to gather perceptual data. The resultant data
on perception could be different if the e-procurement system implementation is assessed
later, in a few years.
Conceptual Framework
There is no consensus on what constitutes good governance and that is not a
purpose of this study. Siddiquee and Mohamed (2007) stated that
Good governance involves much more than efficient management of economic
and social resources or improved delivery of public services; it essentially relates
to the quality of relationship between the government and the governed. It also
involves relationships and cooperation among the public sector, private agencies
and civil society organizations in policy processes as well as the delivery of
services. (p. 288)
Researchers study the implementation of e-procurement in the public sector from
two different perspectives. The majority of research focuses on success factors of the eprocurement implementation and another as an intervention for reform. This research
falls under the second stream. Considerable research attention has focused on the linkage
between e-procurement and corruption reduction, the relationship between cost saving
and e-procurement, the potential of e-procurement to improve transparency and
efficiency in public procurement, and e-procurement and accountability.

25

For the purpose of this study, however, the terms of good governance are used
after analyzing the considerable body of scholarship available in public procurement and
e-procurement sector, and their implementations. The researcher believes good
governance in public procurement can be achieved only with the balanced contribution of
different factors addressing the core principles of procurement. The theory that this
researcher establishes here puts focus on an integrated model, which covers the whole
spectrum of dimensions of good governance in public procurement. The dimensions
under this study include (a) transparency; (b) accountability; (c) corruption control; (d)
efficiency, effectiveness, and predictability; (e) easy access; (f) rule of law and equity;
and (g) civil society awareness.
E-GP, or e-procurement, is more than just a government website on the Internet to
publish information about the procurement opportunities and other related information.
The strategic objectives of e-procurement (see Figure 1) are to enhance good governance
in public procurement sector, obtain value-for-money, and socioeconomic development
in the country (Shakya, 2014). The good governance aspect of the e-procurement
supports and simplifies governance for all stakeholders involved in public procurement:
public/procuring entities, suppliers from business, oversight and regulatory authorities,
and citizens.
The use of the e-procurement system can connect all stakeholders and support
processes for online procurement transactions and other related activities. In other words,
e-GP supports and stimulates good governance. Therefore, the objectives of eprocurement run parallel to the objectives of good governance. Implementation of eprocurement system for the good governance can be seen as an exercise of economic,
26

political, and administrative authority to better manage the public procurement sector in
the electronic environment.

Figure 1. Objectives of e-procurement.

The conceptual framework of this study is based on few theoretical concepts.


Based on the investigation of the literature, the research findings revealed that generic egovernment applications and e-procurement-related research largely used the theories of
the technology acceptance model, diffusion of innovations theory, unified theory of
acceptance and use of technology, and theory of planned behavior to justify the relevance
and results of the implementation of e-services. These theories tested for the eprocurement implementations and assessing benefits also have given results consistent
27

with acceptable variance across various studies. Although a large number of theories and
theoretical constructs were borrowed from the reference disciplines, their utilization by eprocurement researchers appears to be largely random in approach.
Rogers (2003) suggested that technological innovation will be adopted smoothly
and diffuse faster if it possesses five attributes: relative advantage, triability,
observability, complexity, and compatibility. Studies of innovation adoption have been
using these attributes amongst others in their search for factors influencing technological
innovation adoption. In case of this study, e-procurement as an innovative tool for reform
in public procurement sector is required to be adopted by its stakeholders, mainly by the
procuring agencies, bidders, and regulatory/oversight agencies.
Because of its adoption and diffusion in the public procurement sector, it is
expected to enhance good governance in the sector through its relative advantages such
as increased transparency, transparency, efficiency, effectiveness, predictability in
procurement and procurement opportunities, equal treatment to the bidders, compliance
to the acts and regulations by enforcing rule of law through the behavioral changes in
carrying out the procurement processes. Most of such e-procurement initiations are
initially pilot implemented (triability) to confirm the observability. After the successful
trial of the e-procurement system implementation, it should be diffused across the similar
procuring agencies with dynamic sustainable adoption model. The e-procurement
systems should be easy to access and should not marginalize any prospective bidders
giving equal competitiveness and provide user-friendly user interface and simplicity to
understand avoiding complexity of the classical procurement processes and practices
after adequate business process reengineering. Despite the comprehensive business
28

process reengineering, the e-procurement system should still be compliant and maintain
its compatibility with the prevalent Public Procurement Act, Public Procurement
Regulations, and guidelines.
As stated previously, this study evaluated whether the use of the e-GP as a
technological innovation contributes to good governance in the procurement sector of the
government of the country chosen for the research. The public procurement regulatory
and monitoring agency of the country has already completed the trial run of the eprocurement system, developed in compliance with the Public Procurement Act and
Public Procurement Regulations, and currently at the phase of nationwide diffusion
(rollout implementation) and stakeholder adoption.
The level of coordinated incorporation, integration of public procurement, and
different dimensions of good governance in process and practices of the e-procurement
system development and implementation influence the role of e-procurement in
enhancing good governance. However, having all the best practices and dimensions of
good governance in a single system may require considerable understanding of the
principles of good governance in public procurement. The model developed in this study
for accessing the role of e-procurement is focused on enhancing good governance in
public procurement sector generates a comprehensive integrated framework for the
governments implementing e-procurement system.
The perceptions of three groups of stakeholders were assessed: procuring entities,
bidders, and regulatory/oversight agencies. The attitudes of responsible executives
regulating and oversight agencies, procuring entity executives and procurement
professional, emphasizing good governance commitment are also important (Ararat &
29

Ugur, 2003). Public procurement professionals and bidding community have a major
influence on enhancing good governance (Hui, Othman, Omar, Rahman, & Haron, 2011).
Strong governance commitment is required in order to implement an appropriate E-GP
system that ensures transparency (Leipold, 2007).
Research Framework
A conceptual research framework is designed with seven constructs supported by
70 nonparametric questions (see Figure 2). The survey also collected demographic data
of the respondents by four parametric questions (i.e., age group, respondent type, year of
e-procurement use, and their annual participation in e-procurement).

Figure 2. Conceptual framework of study.

30

A solid conceptual good governance framework was needed for this research, and
is embedded in e-procurement system framework for the good governance in public
procurement underlying this research. Each one of these operational variables of the good
governance framework, which derives its theoretical and conceptual underpinning of the
e-procurement system, has been taken as central to the good governance in public
procurement. The main hypotheses of the study were

H0: The e-procurement system does not significantly contribute to enhance


good governance in the public procurement sector.

HA: The e-procurement system significantly contributes to enhance good


governance in the public procurement sector.

Other hypotheses were put forth as


Transparency.

H10: The e-procurement system does not significantly contribute to enhance


transparency of procurement processes and information in public
procurement.

H1A: The e-procurement system significantly contributes to enhance


transparency of procurement processes and information in public
procurement.

Accountability.

H20: The e-procurement system does not significantly contribute to enhance


accountability of the actions in public procurement.

H2A: The e-procurement system significantly contributes to enhance


accountability of the actions in public procurement.

Corruption control.

H30: The e-procurement system does not significantly contribute to enhance


corruption control and reduce corruption in public procurement.

H3A: The e-procurement system significantly contributes to enhance


corruption control and reduce corruption in public procurement.
31

Efficiency, effectiveness, and predictability.

H40: The e-procurement system does not significantly contribute to enhance


efficiency, effectiveness, and predictability in public procurement.

H4A: The e-procurement system significantly contributes to enhance


efficiency, effectiveness, and predictability in public procurement.

Easy access.

H50: The e-procurement system does not significantly contribute to enhance


easy access to government procurement opportunities.

H5A: The e-procurement system significantly contributes to enhance easy


access to government procurement opportunities.

Rule of law and equity.

H60: The e-procurement system does not significantly contribute to enhance


rule of law in compliance with the act and regulations and equity in treating
bidders in public procurement.
H6A: The e-procurement system does not significantly contribute to enhance
rule of law in compliance with the act and regulations and equity in treating
bidders in public procurement.

Civil society.

H70: The e-procurement system does not significantly contribute to enhance


civil society awareness about public procurement.

H7A: The e-procurement system significantly contributes to enhance civil


society awareness about public procurement.
Organization of the Remainder of the Study

The remainder of this dissertation is divided into four chapters. Chapter 2


comprises the extensive literature review surrounding public procurement, reform in
public procurement, the role of e-procurement to enhance the good governance, and its
different dimensions in public procurement sector. It starts with a broad discussion of

32

governance, good governance, and its relatively new concepts around e-governance and
then the good governance through e-procurement.
Chapter 3 outlines the overall research design and methodology for the remainder
of the study. It states the specific hypotheses that the survey instrument sought to validate
or reject. It includes the specific methodologies that the researcher used to gather
quantitative data to support or reject these hypotheses. Included in Chapter 3 are the
specific questions that supported the constructs of each one of the hypotheses outlined.
Finally, the remainder of Chapter 3 outlines the data collection methodologies in order to
support the data analysis and findings in Chapters 4 and 5.

33

CHAPTER 2. LITERATURE REVIEW


Brief History of Procurement
Procurement as a separate area of scholarly study is not very old. Still today in
many countries, procurement (purchasing) is considered a clerical function in a finance or
accounts unit. According to Quesada, Gonzlez, Mueller, and Mueller (2010), only in the
1970s did purchasing/procurement began to receive academic attention and recognition
as one of the key administrative functions.
It was Porters (1980) seminal work, however, that prompted private corporate
firms to think of procurement as a strategic function rather than simply and
administrative one. Since the 1980s, procurement has evolved from being viewed
as merely a process for buying goods and services for a firm, to being more
comprehensively defined as all the activities necessary to acquire goods and
services needed to achieve user requirements. (Tassabehji & Moorhouse, 2008, p.
517)
The strategic importance of procurement has been reiterated frequently, and is
still one of the critical themes found in the literature (Drake & Lee, 2009; Ellram
& Carr, 1994; Kocabasoglu, 2002; Ordanini & Rubera, 2008; Rajagopal &
Bernard, 1993; Rink & Fox, 1999). Soares-Aguar and Palma-Dos-Reis (2008)
and Drake and Lee (2009) argued the importance of giving procurement a
strategic role in the organization and agreed that achieving world-class status in
procurement requires leadership and alignment of purchasing strategy with
business strategy. Although relatively fewer studies have analyzed procurement
and its impact on different functional, firm, or supply chain performance
objectives (Croom & Brandon-Jones, 2007), components of the basic eprocurement model can be gleaned from contributions in the literature at both the
strategic and operational levels. (Quesada et al., 2010, p. 516)
Public Procurement Reforms
The history of public procurement reform is not very old. Focusing on the
analysis of different procurement systems, their merits and demerits, challenges of
34

implementations, purpose of public procurement reforms, and construction of laws


favoring actual reforms and their implementations, very little literature, especially the
academic papers, have been published. Building a body of public procurement
knowledge, one of attributes of a profession, is very critical (Thai, 2004). The body of
knowledge focusing on the comprehensive study on e-government procurement (e-GP)
and its contribution in enhancing good governance in the public procurement sector is
very limited.
Despite its widespread appeal and popularity, governance and more specifically
good governance has remained a highly contested term. Ever since its formulation in a
World Bank document in 1989, various parties used the term governance to refer to a
wide range of issues, ideas, and policies. Early proponents such as the World Bank
(1992) defined governance as the manner in which the power is exercised in the
management of a countrys social and economic resources for development (p. 1).
Governance involves the process of decision making and the formal and informal
structures that are set to get and implement the decision (United Nations Economic and
Social Commission for Asia and the Pacific, 2007). Typically the government sector has
a problem with transparency in procurement (Mitra & Gupta, 2007). In this sector, there
are both formal and informal government structures. Formal government structures make
decisions on procurement and how they are implemented. Informal decision making
involves kitchen cabinets, or informal advisors. Such informal decision making is
frequently the result of corrupt practices or leads to corrupt practices. Good governance
requires a fair process of transactions and services with accountable administration (Bedi,
Singh, & Srivastava, 2001; Saxena, 2006). In general, corruption can be business or
35

government related. Economic corruption is the use of public resources for private gains.
Political corruption is the violation of the formal rules governing the allocation of public
resources by administrators for financial gains or political support (Ampratwum, 2008).
E-GP can provide a solution to address the problems of the lack of transparency and
accountability, efficiency, effectiveness and predictability, corruption control, rule of law
and ethics, easy access to procurement opportunities, bureaucratic inefficiency and
ineffectiveness, nepotism, and cronyism.
According to Arrowsmith, Treumer, Fej, and Jiang (n.d.), the last decade of the
20th century witnessed the start of a global revolution in the regulation of public
procurement. Actually, challenges in procurement reforms are beyond procurement
regulations to include procurement process, methods, procurement organizational
structure, and workforce. According to Thai (2001), procurement reforms occur
constantly in all countries, developed as well as developing countries. The purpose and
scope of reforms may vary from country to country depending on the problems in the
country, but fundamental principles of procurement are in general same either that is in
the developing country or in the developed country. The evolution of procurement is
ongoing, from bureaucratic, manual process, green procurement to e-procurement
systems. Therefore, the efforts have been made for the reform activities for the good
governance in key sectors.
Turning to actual public procurement reforms, procurement laws, and their
implementation, only a small literature has emerged on public procurement practices.
Few studies attempt cross-country comparisons of reform experiences or procurement
practicesexceptions being Trepte (1998) for Bhutan and Laos, and Wittig (1998) for
36

South Africa and Uganda. Moreover, only a few of the articles attempt any form of
impact assessment, benchmarking, quantification of the costs, benefits, or effects of
existing procurement practices or reform initiatives.
Further, the sheer magnitude of resources devoted to public procurement compels
attention. Most nations spend about 20% of gross domestic product on public
procurement (Callender & Mathews, 2000; R. Carter & Grimm, 2001), and developing
nations spend up to 50% (Schiavo-Campo & Sundaram, 2000, p. 315). In the United
States, federal public procurement during 2009 accounted for over $534 billion (General
Services Administration, n.d.) and over 13% of the total federal budget; of the U.S.
states annual budgets, roughly half goes toward goods and services procured from the
private sector (Knight, Caldwell, Harland, & Telgen, 2003).
According to Schapper (2008), civil society awareness and oversight of
procurement processes can enhance governance from the demand side. The author
recommended using e-procurement for enhancing transparency and civil awareness.
Schapper stated,
E-procurement has a range of potential benefits for both process and transparency.
Procurement of goods, works, and services through Internet-based information
technologies (e-procurement) is emerging worldwide with the potential to reform
processes, improve market access, and promote integrity in public procurement.
However, rather than a technical solution, e-procurement should be considered
part of procurement reform in general. (p. 115)
Objectives of Public Procurement
Good governance, value-for-money, and socioeconomic development are the
objectives for procurement (Shakya, 2014). It should be noted that these objectives are
focused on outputs and results rather than procedures.
37

The public procurement system manages up to 20% of the gross domestic product
(Organization for Economic Co-operation and Development, 2006b). A system that
performs well in terms of productivity, efficiency, and integrity has wide-ranging
national benefits. On the other hand, weaknesses in procurement management under
deliver social services, increase sovereign risk for foreign investment, and reduce
national economic growth (International Monetary Fund, 2010). The urgency of
achieving high performance standards in public procurement has been emphasized by the
International Monetary Fund (1998), Asia-Pacific Economic Cooperation (1999), and the
Organization for Economic Co-operation and Development (2006a), which can be
established only through the establishment of best practice in terms of the application of
methods and resources that produce the best social and economic outcomes from public
financial resources, within a value framework of good governance.
Another source of information is the country procurement assessment reports
prepared by the World Bank and other development agencies. These reports provide a
diagnostic assessment of the strengths and weaknesses of the procurement systems in
individual developing countries. The country procurement assessment reports are
publicly available through the World Bank website. According to Evenett and Hoekman
(2005), the country procurement assessment report process has led to recommendations
and financing of action plans to modernize or reform existing procurement systems in a
number of countries. As is true of the more academic literature, the impact of this work
on the performance of national public procurement systems has not been well
documented, in the sense that the country procurement assessment reports tend to focus
primarily on legal compliancewhether laws and required procedures have been
38

implemented and procurement acts, rules, regulations, are complied with by the
stakeholders.
There is some literature available that talks about the contribution of eprocurement on different aspects of the good governance separately or in part. There are
also differences in defining the good governance in public procurement sector. Most of
the scholars and researchers have limited the definition of good governance (Grindle,
2010). It is found that similar conclusions are drawn in more recent literature as well.
Without much consideration countries are adopting the same line of thoughts while
defining the e-procurement strategy or in the implementation of the e-procurement
systems. Research and findings cover a wide range of good governance aspects: Eprocurement can add service value and increase cost savings to the government (Casaki
& Gelleri, 2005; Iqbal & Seo, 2008; Rai, Tang, Brown, & Keil, 2006); E-procurement
can improve transparency and governance change business practice and encourage new
suppliers/vendors to participate in public procurement (Harris & Rajora, 2006); Eprocurement is an effective system which achieves good governance in procurement and
limits political interference (Heywood, 2002); The face-to-face interaction between
government and bidding community can encourage favoritism and bribery in
procurement (Hui et al., 2011); E-procurement highly emphasize on the automatic
enforcement of regulations and reduces the face-to-face interaction and hence prevents
abuse and fraud (Rotchanakitumnuai, 2010); and so on.
The researcher reviewed the body of works in e-procurement that proves the
claim of this researcher that e-procurement is still treated just as one of the tools for
mainstream good governance in public procurement sector, which means the full
39

potential of e-procurement system is still not leveraged by the governments around the
world.
A review of the existing literature showed that e-procurement in the countries
implemented following adequate planning produced increased strategic and competitive
advantages while at the same time contributing to the good governance and also saving
millions of dollars in public procurement and operational costs. Additionally, the
literature reviewed in e-procurement implementation discussed different success factors
at the macro level. Implementation approach plays significant role in the success of e-GP
system. Deise, Nowikow, King, and Wright (2000) supported the implementation of an eprocurement system covering complete procurement cycle for achieving benefits from
the e-procurement system. However, there is no literature, which discusses and analyzes
the perception of the integrated comprehensive role of e-GP to enhance the good
governance in public procurement in a true and measurable sense. Ngambi and Brown
(2004) also agreed with Suchman (1977) that in social research, no event has a single
cause and each event has multiple effects. No single factor is a necessary and sufficient
cause of any other factor (Ngambi & Brown, 2004).
As stated by Carlson and ONeal-McElrath (2008), research and evaluation
determine the impact, effectiveness, and efficiency of any program, in this case the
implementation of an e-GP system as one of the instruments for establishing good
governance in the public procurement sector. The Australian Government Department of
Finance (n.d.) asserted from its experience in implementing e-procurement system that by
communicating e-procurement objectives and strategy and understanding suppliers
concerns, it is possible to ensure suppliers continued support. Getting stakeholders to
40

participate can be difficult, especially if they do not understand the value of the
implementation to themselves and their functional area.
The outcomes of the study will impact the overall perspective on the e-GP
implementation by the governments by highlighting and informing user of the importance
of focusing on the different aspects of good governance, rather than minimally focusing
on transparency, or efficiency, or saving costs and one or two aspects.
According to a study by Hidayanto et al. (2012) on e-GP implementation impacts,
the transparency factor of e-procurements is expected to reduce corruption in government
projects, in an effort to achieve good corporate governance. The study by Hidayanto et al.
further concluded that the implementation of e-procurement had significant impacts on
the total cost of acquisitions, organizational characteristics, governance structure,
presourcing business processes, and procurement quotations.
The outcome of this study reveals a change in behavior and attitude towards the eGP system implementation by addressing gaps in different aspects of governance e-GP
implementation to meet the fundamental requirements of good governance. As stated by
Carlson and ONeal-McElrath (2008), research and evaluation determine the impact,
effectiveness, and efficiency of any program, in this case the implementation of an e-GP
system as one of the instruments for establishing good governance in the public
procurement sector. Enhancing good governance in public procurement sector through
the effective use of e-procurement system has been appreciated by most of the countries
using e-procurement system (Organization for Economic Co-operation and Development,
n.d.). In addition to the perception assessment, the action research questions in this
research were intended to assess the opinion of the participants regarding the adequacy of
41

measures taken in the design and implementation of e-GP systems based on the best
practices in different countries. A few of the questions are designed to assess whether the
e-GP system is in compliance with the Public Procurement Act and Public Procurement
Regulations of the country chosen for this research. The findings of the evaluation
provide input for the public procurement regulatory and monitoring agency to allow them
to calibrate the existing approach of implementing e-GP system as well as provide a
comprehensive e-GP system implementation framework for the countries in the process
of implementing e-GP systems for enhancing good governance in public procurement.
The bidding community appreciates e-procurement when it reduces complex data
entry procedure, validates the data as it is entered by improving data quality, standardizes
and streamlines their work, makes the procurement processes transparent, treats equally
to all bidders, and provides provision of debriefing the reason of failure to win the
contracts, and the access to e-procurement system is hassle free. The Australian
Government Department of Finance (n.d.) asserted from its experience in implementing
e-procurement system that by communicating e-procurement objectives and strategy and
understanding suppliers concerns, it is possible to ensure suppliers continued support.
Getting stakeholders to participate can be difficult, especially if they do not understand
the value of the implementation to themselves and their functional area. This action
research also revealed that there is considerable need to communicate the utilization of an
e-GP system to enhance the good governance in public procurement to the stakeholders.
The United Nations Educational, Scientific and Cultural Organization (2005) indicated
that the e-awareness amongst the government employees and their willingness to
embrace change shall play a key role in the whole process.
42

The action research aspect of the research will improve current practice through
the application of findings generated by the utilization-focused evaluation (Patton,
2012a). Action research has been described as a form of community-based research
focusing on a participatory method of investigation (Stringer, 2007). Determining
whether the program theory will precipitate change through knowledge acquisition,
which will generate behavior and attitude change will be the focus of the utilizationfocused evaluation. Both components of the research, the theory of change model and
action research will provide the stakeholders with the opportunity to work together to
determine not only the programs design and planning, but also program implementation
and evaluation in terms of expected measurable outcomes, whether immediate,
intermediate, or long-term (Kaufman et al., 2006).
In this research, the technology acceptance model, diffusion of innovations
theory, and e-government theory are applied to model the constructs. Saidi and Yared
(2002) asserted in support of e-government theory that e-government, as a major
instrument for achieving good governance, accompanying important investment in
media, information, and communication technologies can be an important source of
productivity growth and economic growth along with economic development and
democracy. The Organization for Economic Co-operation and Development (2006a), in
its study of country system in e-procurement in Italy, North Africa, and Egypt, asserted
that the e-government, of which e-procurement is an integral part, is one of the most
valuable information-and-communications-technologies-based administrative innovation
reforms; it can render public policy more effective, efficient and responsive to social and
political needs. It can provide a framework for organizing comprehensive e-reform,
43

starting with government and the public sector. In this study, it was assessed what
contribution of this technological innovation and diffusion bring to enhance good
governance in the public procurement sector.
For the conceptual framework, the diffusion of innovations theory also plays
significant importance, which was developed by a sociologist to explain how an
innovation diffuses through a society (Rogers, 2003). It has been used extensively to
explain the adoption of information technology innovations in an organization or society
(L. Carter & Blanger, 2005). Innovation is an idea, a practice, or object that is
perceived as new by an individual or another unit of adoption (Rogers, 2003, p. 229),
and diffusion is the process by which an innovation is communicated through certain
channels over time among the members of a social system (Rogers, 2003, p. 229). The
rate of diffusion of innovation is affected by five attributes (Rogers, 2003): relative
advantage (the degree to which an innovation is perceived as better than the idea it
supersedes [p. 229]), compatibility (the degree to which an innovation is perceived as
consistent with the existing values, past experiences, and needs of potential adopter [p.
229]), complexity (the degree to which an innovation is perceived as relatively difficult
to understand and to use [p. 229]), triability (the degree to which an innovation may be
experimented with on a limited basis [p. 229]), and observability (the degree to which
the results of an innovation are visible to others [p. 229]). These characteristics are key
influences on adoption behavior (Agarwal & Prasad, 1997).
In the case of statistical analysis, Cheng and Wang (2006) stated that the Kaiser
MeyerOlkin measure of sampling adequacy is an index for comparing the magnitudes of
the observed correlation coefficients to the magnitudes of the partial correlation
44

coefficients. The authors suggest that large values for the KaiserMeyerOlkin measure
indicate that a factor analysis of the variables is a good idea. Another indicator of the
strength of the relationship among variables is Bartletts test of sphericity. Foulger (1979)
argued that there is no meaning of rejecting the null hypothesis, if the observed
significance level very small. In addition to the KaiserMeyerOlkin and Bartletts test,
other factor analysis results considered for each construct were the total variance tables,
component matrices tables, and commonalities tables.

45

CHAPTER 3. METHODOLOGY
Action Research Evaluation Approach
A utilization-focused evaluation (U-FE) approach was used for this action
research as it provides a well-suited framework (Patton, 2012a) for carrying out the
research and analysis in which people in the real world apply evaluation findings and
experiences to their work. According to Ramirez and Broadhead (2013), U-FE
evaluators facilitate a learning process with attention to how real people in the real world
might apply evaluation findings and experiences. In designing a U-FE, the attention is
constantly on the intended use by intended users (p. 1). As the action is the only way to
generate and test new social science knowledge, the evaluation findings in participation
of intended users will be prepared as the classified recommendations for use.
The U-FE framework (see Figure 3) covers 17 steps outlined by Patton (2012a).
This action research project adopted 15 steps in a 17-step process to find solutions or to
make recommendations to the implementing agency for the best utility of the eprocurement system contributing to enhance the good governance in procurement sector.
Step 16, Follow-up with the users to facilitate use, and Step 17, Utilization-focused metaevaluation, are left for the future research. The study analyzed the implementation of eprocurement system in one of the developing countries addressing different dimensions
of good governance. Initially, perception about the role of the e-procurement in public
procurement good governance and their attitude towards its use were assessed and
46

analyzed, and recommendations for improvement were provided. The outcome


contributes to change in the behavior and attitudes of public organizations as well as all
stakeholders in using the e-procurement for the enhancement in different aspects of good
governance in practice.
Pattons (2012a) U-FE of complex, dynamic and adaptive systems through 15
steps out of 17 steps were the principle framework for the action research and acted as the
action plan. However, these 15 steps were incorporated and configured under Stringers
(2007) model of Look, Think, and Act to serve as the action plan as described as follows.
Look: Building the Picture
Step 1: Access organization readiness. U-FE is premised on evaluation
processes that are designed, implemented, and utilized by carefully selected users who
take ownership over the evaluation process by active involvement throughout the process.
For this action to take place the organizations involved need to be ready. Step 1 assessed
the organizational readiness of the chosen site for the study to take on implementing an eprocurement system. The users readiness to participate, own, and learn from the
evaluation is a necessary condition for a successful outcome. The researcher conducted a
meeting to introduce the principles of U-FE concept, conducted a brief interaction with
the authority of the public procurement regulatory and monitoring agency as an
assessment of the readiness to take on responsibility for evaluation and embrace it as a
learning process. The agency authority showed keen interest and was ready. The agency
welcomed the researcher for carrying out the evaluation, and expressed to extend full
support for the facilitations required.

47

Utilization-Focused Evaluation Checklist


Figure 3. Utilization-focused evaluation interaction.
Note. From Essentials of UtilizationFocused Evaluation (p. 426), by M. Q. Patton, 2012, Thousand Oaks, CA: Sage.
Copyright 2012 by M. Q. Patton. Reprinted with permission.

The document review was carried out which consisted of records of the registered
bidders, procuring entities, and oversight agencies in e-procurement system, reports from
earlier studies on e-procurement readiness assessment, procurement management
48

19

information system reports, e-procurement system usage statistical analytics, and reports
of Transparency International. Assessment of stakeholder readiness was taken place
through their formal approval from the key leaders (agency officers, procuring entities
representatives, bidders, and oversight agencies) for the participation in the evaluation.
The value of the evaluation was clearly communicated to the stakeholders. This
commitment was assured with the introductory letter sent to the stakeholders, which
described the purpose of the research, including the need for consistency in participation
throughout the project. As suggested in Ramirez and Broadhead (2013), the following
aspects were ensured in Step 1:

A redefined role for an evaluator with emphasis on facilitation

An investment in time and resources to build U-FE capacity particularly at the


start of an evaluation process

A clear commitment to the exercise by the leadership and primary users (staff)
to allocate their time to the work

Step 2: Access evaluator readiness. This step required a self-assessment by


evaluators of their readiness and capability. Facilitation skills, commitment to U-FE, and
willingness to learn U-FE together with users are essential for the researcher. Ramirez
and Broadhead (2013) noted that self-assessment of a process that is learned by doing is
difficult to achieve. The authors further suggested to having an evaluation mentor, so that
such a reflection can take place as the mentor and the evaluator interact. In this action
research the dissertation mentor played such the evaluation mentor role.
Step 3: Engage primary intended users. Selection of primary intended users
was done using the identification criteria listed in Patton (2012a, p. 408) that included
identifying stakeholders who have a personal/vested interest or intended beneficiaries
49

public procuring entities (in some countries, they are called contracting authorities) who
spend public money, the bidding community (suppliers and contractors, also called
economic operators in some countries), and regulatory/oversight agencies.
Step 4: Conduct situation analysis. Situational analysis was conducted jointly
with primary intended users. According to Ramirez and Broadhead (2013), evaluation
use is people and context dependent. Use is likely to be enhanced when the evaluation
takes into account and is adapted to specific situational and organizational factors (p.
32). A focused, intentional, and systematic situational analysis calls for ensuring the
primary intended users understanding of the program, appreciating stakeholders
interests and potential areas of conflict, understanding the prior history and experiences
with evaluation, and making explicit the decision context that will affect use of decisions
and evaluation findings. The analysis may help by identifying and examining factors that
may contribute to use and those that may be barriers (Patton, 2012a). The researcher
identified barriers and limitations, such as time, funding, and potential stakeholder
turnover; and maintain flexibility in order to adapt to systems changes, if and when they
occur.
Steps 5 through 8: Step 5Identification of primary intended uses; Step 6
Focusing the evaluation design; Step 7Evaluation design; and Step 8Check the
adequacy of evaluation inquiry being addressed. The researcher worked with the
stakeholders to help determine and clarify the primary purpose of the U-FE and how the
results/recommendations can be implemented. This was done through communication
and interviews with the primary users. The researcher guided the stakeholders through

50

the process with the goal of increasing their knowledge, skills, and sense of ownership of
the e-procurement program.
The researcher allowed the stakeholders to decide on the direction of the
questions to be asked, without evaluator bias or influence. Finally, the researcher
established the evaluability assessment to meet credibility, relevance, and validity
requirements by creating outcomes evaluation in terms of the program. Questions asked
included (a) Is the program ready for evaluation? (b) Have the goals of the program been
metthat is, do the stakeholders and users have the measurable skills for using eprocurement system? (c) How have the stakeholders been changed by the study? (d) Are
there any unanticipated outcomes from the program and the study? (e) Are best practices
being followed? and (f) How are those defined?
Tests for establishing construct validity (through using multiple sources of
evidence), internal validity (using pattern matching and logic models), and external
validity (using theory), and reliability (using focus groups discussions) were also carried
out. The researcher used multiple sources of evidence from the data, interviews of
stakeholders through questionnaires and focus groups and feedback. Use of theoretical
frameworks (as described previously) and literature reviews assisted in establishing
external validity. In summary, this stage involved

Planning through setting priorities, ranking them in order of importance, and


assigning tasks as an action plan

Implementing the action plan by assignment

Evaluating progress

Checking for validity, reliability, propriety, and accuracy


51

Step 9: Theory of change work. The researcher helped stakeholders


conceptualize the evaluation design and measurement approach by helping design and
map the e-government procurement (e-GP) functions and procedures in place with the
aspects of good governance requirements like transparency, accountability, participation,
the rule of law, effectiveness, efficiency, predictability, fighting corruption,
proportionality, consistency and coherence (Organization for Economic Co-operation and
Development, 2006a). In other words, stakeholders understood the interaction of outside
factors that may impact the outcomes of the e-GP system as asserted by Weiss (2000) on
the general program theory that posits that access to information and clear
communication about the program will change knowledge, which will change behavior.
Steps 10 through 13: Step 10Negotiate methods; Step 11Methods
debates; Step 12Simulate use of findings; Step 13Gather data with ongoing
intention to use. Following Patton (2012a), who suggested involving primary intended
users in decisions regarding the selection of research design, measurement, and data
collection methods, the researcher involved the stakeholders in the data collection and
analysis process in order to generate useful findings as well as create ownership of the
problem. It enhanced the transparency and capacity and their support on the outcomes of
the evaluation. With the consent from the stakeholder quantitative data collection
technique was determined from the survey questionnaire and qualitative data from the
focus group discussions. Data collection occurred through a questionnaire survey and
focus group discussions with the stakeholders as the primary data sources, and secondary
data were collected from the different publicly available earlier project reports, study
reports, research papers, data available from Transparency International, Organization for
52

Economic Co-operation and Development, the World Bank, Asian Development Bank,
and other development agencies. In focus group protocol (Johnson & Christensen, 2008),
initial questions were general, followed by more specific open-ended questions.
Information from research literature were widely used and included.
Think: Interpreting and Analyzing
Step 14: Data presented for user engagement. The researcher presented data in
a usable format for the stakeholders by organizing the findings by tables, graphics, theme,
distinguishing facts from opinion, and establishing coding methods to maintain
anonymity of responses as well as ethical standards. In other words, data were
categorized and coded, and emerging themes were identified. This occurred by
comparing units of information (obtained through data collection), triangulating the data
through focus group discussion, and looking for recurring regularities (Merriam, 1998).
These categories reflected the purpose of the research, were exhaustive, mutually
exclusive, sensitizing and conceptually congruent (Merriam, 1998). The number of
categories was determined by the focus of the research.
The facilitator actively involved the stakeholders in triangulating the data to
facilitate data interpretation. This process involved setting meeting with the public
procurement regulatory and monitoring agency officers and identified converging as well
as diverging perspectives; and to interpreted and analyzed the data in order to complete
this cycle of the study. Recommendations for using the findings were created bearing in
mind relevance to the purpose of the study, as well as actions that are within the control
and influence of the stakeholders (Patton, 2012a).

53

Act: Resolving ProblemsPlanning and Implementing Sustainable Solutions


Step 15: Report produced. The researcher worked with the agency officers to
identify priorities for action. A short-term strategy with an action plan was created to
address the recommendations in the second phase of e-procurement system
implementation. The strategy and action plan included a list of goals (in order of
importance), objectives, tasks, people responsible for carrying out the action, where and
when the action will take place, as well as the resources needed to fulfill the action plan.
This included discussing with the procuring entities and bidders, and regulators the
optimum ways to disseminate the findings of the evaluation to be incorporated in the
second phase of e-GP system, and to reach all audiences in order to increase knowledge
and understanding of the e-GP system; and developing methods to follow up on project
implementation to keep it an ongoing process.
The scope of the study does not cover the final two steps, 16 and 17, of the U-FE,
although Step 16 was assessed partially to confirm whether the findings and
recommendations of the study has been considered for the improvement. As Step 16
should cover the follow-up with users to use and Step 17 should reassure the evaluation
through the consequent meta-evaluation of the evaluation itself, substantial interval of
time is required to carry out the meaningful accomplishment of these steps. Thorough
evaluation of Steps 16 and 17 are intentionally left out for future research.
Meta-Evaluation of Use
The meta-evaluation purpose is to provide stakeholders the ability to
independently assess the strengths and weaknesses of the evaluation, and guide these
stakeholders in judging the credibility of the said evaluation (Patton, 2012a). Outcomes
54

evaluation, which will focus on the changes that occurred as a result of the program
(Fitzpatrick, Sanders, & Worthen, 2011), will assess whether the governance situation in
the procurement process changed, and delivery of service improved. Outcome indicators
to measure the success of the program will be assessed through procurement performance
indicators analyzed from the e-procurement statistical analytics, reports from
procurement management information system, study, review, and evaluation reports.
The primary purpose of the meta-evaluation will be to demonstrate utility,
feasibility and accuracy of the U-FE and case study of the impact of e-procurement
system implementation on good governance. The primary intended users of the metaevaluation will be the legislators, development partners, oversight agencies and policy
makers of the country who influence funding as well as future implementation of eprocurement systems in different countries, the public procurement regulatory and
monitoring agency and procuring entities who use the e-procurement system for
streamlining their procurement processes addressing the requirements of good
governance, and bidding communities (suppliers and contractors of goods, works, and
services), citizens and civil society who are impacted by the service delivery through the
use of e-procurement system. At the core of the U-FE is to provide primary intended
users with information about the program in order to reduce uncertainty of their actions
and increase their control (Morgan, 1996).
Research Design
This section presents a description of the design of this research, the methodology
that was utilized, the target population that was included, the instrumentation that was
55

implemented, how the data were collected and analyzed, and the ethical considerations
related to this research.
The findings, results, discussions, and conclusions of this research are based on
the convergent parallel mixed method approach. Both qualitative and quantitative data
collected are analyzed in order to compare results. Both types of data formats were used
in order to provide strength to the research in terms of validity and credibility. Surveys
provide quantitative data, which was then compared with the qualitative data obtained
from focus groups interviews.
The rationale for using the convergent parallel mixed method design for the
project evaluation is to obtain a comprehensive understanding of the program from both
sets of data through simultaneous comparison and interpretation. According to Patton
(2012b), U-FE is inherently participatory and collaborative in actively involving primary
intended users in all aspects of the evaluation. The participant-oriented strategy employed
using the framework of the convergent parallel mixed method approach during the data
analysis and evaluation phases.
The evaluation involved the stakeholders who examined the data from both
quantitative and qualitative sources in order to compare and triangulate the information
for accuracy and credibility. Stufflebeams (1999) checklist was used to serve as a
blueprint for evaluation. Evaluation methods based on these factors included

Survey questionnaire response of suppliers and contractors of goods, works


and services, citizens, society, governments procurement agencies,
development agencies, and regulatory/oversight bodies and the policymakers
(quantitative)

Three focus group discussion with bidding community, procuring entities, and
regulatory/oversight agencies (qualitative)
56

Documents and records obtained from previous statistics and studies


(quantitative and qualitative)

No participants were used in the analysis for which parental permission was
required.
Sample
Participants in the target population included the personnel from the three key
stakeholder groups. Each one of these participants had significant role to impact on the
good governance in public procurement. Surveying the entire population would be
difficult, if not possible to perform. However, noted statisticians Cooper and Schindler
(2008) argued that research quality is often better by using sampling versus the entire
population. Additionally, sampling is done at a lower cost and has a quicker turnaround
time.
The sample size not only was determined by the population size but also was
dependent on the specific context of the research site selected. The country in which this
research is conducted is in early stage of e-procurement implementation and the user base
is still limited. There are three key user groups of e-procurement systems (see Figure 4).

57

Figure 4. Three user groups of an e-procurement system.

Sample selection contexts are discussed as follows:

Public entities having experience in e-procurement systemThere were 29


public agencies (as of March 17, 2014) registered in the e-procurement
system, out of which only 15 (almost 50%) have experience using the eprocurement system for the procurement transactions. All of those 15 public
agencies were selected for the survey. Participation requests were sent to three
persons in each of those agencies requesting to be responded by three levels of
personnel involved in the e-procurement process: (a) Official having authority
to make decision on the procurement, (b) personnel involved in the
procurement process, and (c) e-procurement focal person responsible for
technical aspects of the e-procurement. Each of the procuring entities
registered in the e-procurement system was asked to nominate one focal point
for their entities.
58

BiddersThere were 200 private firms registered as the bidders (goods


suppliers, works contractors, service consultants) in e-procurement system as
of March 17, 2014, and among them, 79 bidders had experience participating
in e-procurement. From among this group, 20% of the bidders (i.e., 16
bidders) having e-procurement experience were randomly selected from the eprocurement bidders database for the participation in the survey.

Regulatory/oversight agencyFour regulatory/oversight agencies were


identified in relation to public procurement in the country. Among the four,
the public procurement regulatory and monitoring agency of the site country
is the host of the e-procurement system and also regulatory authority for the
public procurement in the country. The agency accepted to be the site for
carrying out the research. Also, three other agencies were identified as the
oversight agencies and were nominated for the participation in the survey.
Instrumentation

A 5-point Likert-scale survey was designed with a common set of questionnaire


with seven constructs supported by 70 nonparametric questions (see Figure 5). The
questions were designed to test the perception of three target groups (i.e., public entities,
bidders, and regulatory/oversight agencies) on the role of e-procurement under the
different dimensions of good governance: (a) transparency; (b) accountability; (c)
corruption control; (d) efficiency, effectiveness, and predictability; (e) easy access; (f)
rule of law and equity; and (g) civil society awareness. The survey also collects
demographic data of the respondents by four parametric questions (i.e., age group,
respondent type, year of e-procurement use, and their annual participation in the eprocurement).

59

Figure 5. Structure of study survey questionnaire.

At first, a consultation meeting was held with the officers of the public
procurement regulatory and monitoring agency of the research site country as part of the
U-FE Step 7 (evaluation design) to conduct a field test to help ensure the questions are
rightly phrased, wording was clarified, Public Procurement Act and Public Procurement
Regulations requirements are covered, international best practices are covered along with
the removal or rewording of ambiguous statements and that fully supports the intended
study.
Next, a focus group discussion interview guide was designed for conducting focus
group discussions with the three separate groups. The focus group discussion interview
60

guide protocol consisted of the ground rules for the discussion as well as the guiding key
questions for driving focus group discussions to validate the participants reasoning
behind their views expressed through the perception survey responses, as well as to
understand how the ideas and opinions in case of good governance in public procurement
through e-procurement consolidates in the course of discussion. The site was identified,
taken approval, and the survey and the interview guide were approved by the Capella
University Institutional Review Board before engaging with participants.
Data Collection
The data were collected using the survey questionnaire designed covering the
seven dimensions of good governance in public procurement sector. The Likert range
was Strongly disagree, Disagree, Dont know, Agree, and Strongly agree, which equated
numerals from 1 to 5 respectively. The survey questionnaire was sent to 67 respondents
under three groups of e-procurement users (i.e., public entities, bidders, and
regulatory/oversight agencies) through e-mail as well as hand-delivered. The responses to
the survey questionnaire were received through e-mails as well as in-person handreturned. Among them, 35 responses were from the public entity users, 12 responses from
bidders, and 6 responses from the regulatory/oversight agency users were received. This
provided a response rate of 79%.
The data collected through the questionnaire for all the seven dimensions of good
governance in public procurement through e-procurement was analyzed using measures
of central tendency which included the most common measures of mode, median, and the
mean (Bernard, 2000). Each individual response was collected and coded in Microsoft
61

Excel file. Identity of the respondents was made anonymous just using the respondent
codes.
Next, three focus group discussions with the three separate groups were
conducted to validate the participants reasoning behind their views expressed in
perception questionnaire survey, as well as to understand how the ideas and opinions in
case of good governance in public procurement through e-procurement consolidates in
the course of discussion. Candid opinions expressed on each of the dimensions of good
governance in relation to the use of e-procurement and its role were captured to validate
the survey responses. A total of 19 people participated in the three focus groups.
Data Analysis
Data were collected using Likert scales for the quantitative data analysis. Based
on the statistical literature review and advice of experts, Cronbachs alpha for ensuring
reliability and factor analysis for validity were done by the KaiserMeyerOlkin measure
of sampling adequacy test and Bartletts test of sphericity tests. Additionally both the
Friedman chi-square test and the chi-square goodness-of-fit test for nonparametric
samples were used during hypothesis testing. These tests were considered appropriate for
discrete distributions or when the distribution is not known ahead of time. Garson (2006)
stated that a nonparametric test by using the chi-square test ascertains significance if the
sample size is large enough. When there different arguments on the appropriate size
required for testing hypothesis, Garson also recommended that at the significance level of
.05, a minimum of 50 samples are necessary in order to conduct proper hypothesis
testing. This research collected 53 samples in order to be more conservative and more
robust in the data analysis section.
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These data were then analyzed using measures of central tendency, which
included the most common measures of mode, median, and the mean (Bernard, 2000),
factor analysis. Many literatures recommended using an analysis of variance test when
there are three or more groups for comparison. The two-way analysis of variance test was
conducted in order to determine if the research questions and the underlying hypotheses
stated were supported or not supported as well as to see the significance of the
interactions between dimensions (constructs or factors). These tests were conducted on
sample data collected under with seven constructs supported by 70 nonparametric
questions from three groups of e-procurement users of public entities, bidders, and
regulatory/oversight agencies involved in both procurement transactions and eprocurement system management. As the research model is based on multiple dependent
variables (dimensions of good governance) and independent variable divided into three
groups of users, a general linear-model-based multivariate analysis of variance was
carried out to look for an effect of one or more independent variables (user groups) on
these dependent variables at the same time (Cook, 2010).
The exact number of registered public agencies, and bidders was known from the
e-procurement system database, and the regulatory/oversight agencies were identified in
discussion with the public procurement regulatory and monitoring agency during U-FE
preparation discussions and situational analysis activity.
The responses to the survey questionnaire were received through e-mails as well
as in-person hand-returned. Among them, 35 responses were from the public entity users,
12 responses from bidders, and 6 responses from the regulatory/oversight agency users
were received. Eight out of 43 public entity users, 1 out of 7 regulatory/oversight agency
63

user, and 6 out of 17 bidders did not provide their responses. As such, 35 public entity
respondents would represent a sampling of 40.22% of the population, 12 bidder
respondents would represent a sampling of 15% of the population, and 6
regulatory/oversight respondents would represent a sampling of 85%, a reasonably
adequate and acceptable sample, especially when using nonparametric statistical
sampling (Cooper & Schindler, 2008).
The sample data were tested using chi-square goodness-for-fit. This is a
nonparametric statistical inference test that can be used in tests involving nominal data
such as a Likert-scale survey (Cooper & Schindler, 2008). It allows the researcher to test
differences between observed distribution of data and the expected distribution based on
the null hypothesis (Cooper & Schindler, 2008, p. 484). Based on the number of
dimension (factors) of good governance through e-procurement, the observed number of
cases in each factor of the Likert-scale survey, and the expected number of cases of the
factors based on the null hypothesis, the researcher will be able to reject or fail to reject
each one of the null hypotheses, using a .05 level of significance.
Reliability and Validity
In order for the collected data to be useful for statistical analysis and inferences,
the data must meet tests of validity and reliability (Russ-Eft, 1980). Validity demonstrates
the degree to which the instrument actually measures that which it is intended to measure
(Russ-Eft, 1980). Furthermore, a survey instrument that is reliable can be expected to
achieve consistent results when used repeatedly.
Validity can be further broken down into two types: external validity, which
explains how well the data can be generalized over differing situations; and internal
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validity, which answers the question of how well the instrument measure what it is
intended to measure (Cooper & Schindler, 2008). In order to ensure both the validity and
reliability of the research, a field test was conducted using a small group of individuals
who represented the target population in coordination with the research site agency. The
researcher screened the questions for vague and misleading language, as well as testing
and screening for vague terminology and poorly formed construct statements. Next, the
results were tested using factor analysis and Cronbachs alpha to help ensure validity and
reliability of the survey instrument.
Ethical Considerations
Ethical considerations surrounding the use of any survey instrument that involves
the use of human subjects are not only an important part of ensuring external validity of
the research but also an essential part of ensuring that the research is conducted in a way
that protects these subjects from any harmful consequences. Important aspects of these
ethical considerations are ensuring that survey participants understand the voluntary
nature of the survey, are willing participants of the survey through the use of acceptable
informed consent practices, are assured of complete anonymity during the survey
process, and finally can be assured that no personal information will be collected which
could be used to identify them or attach them to the survey in ways that would be harmful
to the survey participants (Cooper & Schindler, 2008).
Before this survey was conducted, the questions were vetted. The primary ethical
considerations included the principles of informed consent of the individual and
reasonable protection of the individual from harm during any research involving human
participants (Fowler, 2002). The cover page of each survey contained information
65

regarding privacy protections and informed consent. Reasonable procedures were used in
this research to insure both of these principals were met. The survey did not ask for any
data that could possibly be used to identify the subject. A full disclaimer appeared on the
cover page of the survey questionnaire explained that participation in the research was
voluntary, along with the fact that there were no demographic data fields that could
reveal specific personal attributes of the participant.
The research site is the regulatory/oversight agency in public procurement, which
also owns and operates the national e-procurement system. One of the international
development banks has provided a grant to the government to strengthen the public
procurement reform through the development and implementation of the e-procurement
system. The international development bank for the project hired the researcher as an
international advisor on e-procurement. The researchers participation is limited in the
mission meetings with the research site officers, and also different meetings to review the
project progress. Because of this relationship, the researcher is familiar with some of the
e-procurement-project-related officials but there was no conflict of interest because the
researcher drew research data from an outside review of the project.
This research analyzes the implementation of the e-procurement system in the
research site country on dimensions of good governance by measuring the users
perception of the role of e-procurement, and their attitude towards its process and
operation. The professional relationship between the researcher and the participants does
not pose any bias, as the research analyzes outside perceptions of the new e-procurement
system by outsiders, not the participants that the researcher was advising.

66

There are three separate groups of respondents participating in the research, and
the researcher took clear measures to ensure there is no influence or bias in bringing them
into the research and evaluation. The survey administration tool used by the researcher
was designed to guarantee total anonymity of the survey participants. The survey and the
data collection tool were designed to hide any identifying features that could have
allowed the researcher to identify any specific personal identification of the survey
participants. The respondents participating in the research were treated with fairness,
respect and confidentiality. The professional relationship did not pose any risks to the
respondents, as the researcher did not posses any financial or other kinds of influence
upon the respondents. Data collected from the respondents are removed of all identifying
information. The confidentiality of the personal information, if any, of the participants
are separately maintained in an electronic file and each of the respondents are assigned a
code number. Only the code number was used to identify the related group, and for the
analysis of the responses. Respondents were all nonnative English speakers. English is
not a native language in the research site country but English is the second common
language. Translation services were not required for any of the respondents.

67

CHAPTER 4. RESULTS
Site Description
The government of the research site has initiated governance reform program in
various areas for effective public service delivery. Among others, public procurement is
one of the prime areas of reform of the government. As a part of this reform agenda, the
government has issued the Public Procurement Act and Public Procurement Regulations
to make the public procurement system transparent, fair, competitive and efficient. These
two legislations aim to maximize good governance through an effective and efficient
public procurement by equal competition among bidders, fairness, accountability and
reliability in public procurement processes. Also, as mandated by the act, public
procurement regulatory and monitoring agency was established. The overriding objective
of the agency is to implement the act effectively as well as to deliver efficiency and
value-for-money in the use of public funds adhering to the principles of public
procurement.
The public procurement regulatory and monitoring agency is implementing a
National Portal of e-GP System as a unitary platform for the procurements of goods,
works and services for all the public entities in line with the Public Procurement Act and
Public Procurement Regulations. The first phase of e-government procurement (e-GP)
system was designed to facilitate the bidder to prepare an annual procurement plan,
prepare bidding document, download bidding documents, prepare bids, and submit bids.
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The second phase of e-GP system also has already been started with new functions and
incorporating the feedback and recommendations from the stakeholders based on the
experience of the first phase of implementation. The second phase also incorporated most
of the recommendations based on the findings from this action research. Use of e-GP
system is intended to increase transparency, nondiscrimination, equality of access, and
open competition. Pilot implementation of e-GP started in April 2013. The e-GP site also
provides easy to use Internet access for tender information, information on award of
contracts.
One of the international development banks is supporting the e-GP
implementation introduced under the Strengthening Public Management Program.
Research Methodology Applied to Data Collection and Analysis
The following research questions were asked:
1. Has the use of e-procurement system or e-government procurement system in
public procurement enhanced the good governance in public procurement
sector?
2. Does e-procurement add value to public procurement? If e-procurement
increases (a) transparency; (b) accountability; (c) corruption control; (d)
efficiency, effectiveness, and predictability; (e) easy access; (f) rule of law
and equity; and (g) civil society awareness, then it is worth the investment.
With the increased trend of using e-procurement systems across the world by
government, proponents of the e-procurement, including Hidayanto et al. (2012), claim
that e-procurement plays a significant role in enhancing good governance facilitating
different aspects of good governance by the leverage of the Internet technology and
underlying best practice procurement processes, functions and its governance framework.
This study explored those claims.
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Respondents were selected using purposive sampling to ensure a variety of public


entities. A questionnaire survey was used to gather data from at least two respondents
responsible for procurement using the e-procurement from each of the entities.
Respondents were managers, procurement professionals and also the ones who were
involved in the implementation of e-GP system in their respective public entities. The
names of the respondents have been kept anonymous due to confidentiality because this
study studies the role of e-procurement in good governance in the public procurement
sector in the country of the research site.
The survey questionnaire included 70 questions regarding seven constructs
considered to be the dimensions of good governance in public procurement, and
additionally there were four questions on a respondents profile in a view to get reliable
and valid data on the perceptions, attitudes, and general knowledge for each variable. For
the meaningful analysis of each of the variable, reliability and validity analysis was
carried out.
Analysis, Synthesis, and Findings
The research showed that the implementation of e-GP system is well accepted by
all the stakeholders despite having several obstacles. Again, a synthesis of several of
these obstacles indicates that the research site agency as an implementing agency appear
to have much more of a tactical than a strategic focus.
Other than a compilation of synthesis of analysis and findings with
recommendations based on dimensions of good governance as an outcome of this action
study in Appendix A, some other implementation issues must be analyzed here:
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Despite many scholar literatures recommend phased implementation of e-GP


implementation as one of the essential requirement for the success of e-GP
system, it appeared from the research that the phased approach of
implementation e-procurement system without having implemented complete
set of key processes is not always favorable for achieving desired target. The
country started with the phased implementation approach starting with
functions covering online bid submission, and then other phases. Within the
bid submission phase also the government took phased approach of allowing
hardcopy and softcopy submission at the beginning, and change to only online
submission in later phases. If phase implementation is planned, the phase
should be designed in such a way that it demonstrates the effectiveness of
implementation and integrity of the process of procurements are maintained,
not that it is phased to see if the system works or not, or functions
implemented are complete or not. Purpose of the implementation should be
clear at the design phase. Phasing is not effective if something is done
electronically and other functions of the process are done in manual system. In
absence of fit-for-purpose planning in phasing, actual benefit could not be
achieved.

Slow adoption of e-GP system is the impact of continuity of options accepting


parallel submission of bids both in hardcopy as well as through e-procurement
system for the same tender. Because both the options are open for the bidders,
it is comfortable for them to stay with the status quo.

Continuity of requirements to submit hardcopy original bid security and other


documents, which brings bidders and procuring entities face-to-face, opening
doors for potential corruption.

Many procurement processes are not automated, which does not really reduce
the administrative efforts but adds additional burden to procuring entities.

This research asserts that the implementation of e-GP system significantly


enhances the good governance in public procurement sector, however it suggests that a
comprehensive and practical e-GP implementation framework is absent in the body of
knowledge on e-procurement. This research also strongly establishes the theory that only
a synergetic and integrated approach of e-GP implementation can bring significant
improvement in good governance. If only one or two principles of procurement are
addressed by e-GP, then the rest of the principles should be addressed by traditional
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approach, which creates huge disparity in delivering service. It rather reduces


performance, and hence outcome of reform agenda becomes insignificant.
In that sense, the outcomes of the study have impacted the overall perspective on
the e-GP implementation by the governments by highlighting and informing user of the
importance of focusing on the different aspects of good governance, rather than
minimally focusing on transparency, or efficiency, or saving costs and one or two
aspects.
Reliability Analysis
A commonly accepted rule of thumb is that an alpha of 0.6-0.7 indicates
acceptable reliability (although many state that this should be at least .7), and 0.8 or
higher indicates good reliability. Very high reliability (0.95 or higher) is not necessarily
desirable, as this indicates that the items may be entirely redundant. These are only
guidelines and the actual value of Cronbachs alpha will depend on many things. For
example, as the number of items increases, alpha tends to increase too even without any
increase in internal consistency (Zaiontz, n.d.).
The ultimate purpose of designing a reliable instrument is to ensure that the scores
of similar aspects are relevant (i.e., internally consistent, contributing some unique
information to support the overall hypothesis).
As illustrated in Table 1, all dimensions of e-procurement good governance
factors have high levels of reliability with Cronbachs alpha () ranging from 0.640 to
0.910. This ensures the reliability of the instrument designed for the survey. It suggests
that the questionnaire prepared for the survey are internally consistent, and contributes to
support the hypothesis. It confirms that the tests were designed with high quality and the
72

data received are reliable. The dimension Easy Access scored the lowest value ( =
0.640) and the dimension Accountability scored the highest value ( = 0.910).

Table 1. Reliability Analysis for Dimensions of Good Governance Factors


Number
of
applicable
survey
questions

Sum of
variance of all
questions
(var)

Transparency

24

27.442

115.114

0.795

Accountability

15

20.301

134.625

0.910

Corruption Control

5.470

13.972

0.811

Efficiency, Effectiveness, and Predictability

8.648

27.821

0.788

Easy Access

10.664

24.259

0.640

Rule of Law and Equity

3.814

9.385

0.692

Civil Society Awareness

4.717

11.182

0.771

Dimension

Variance of
score totals
(var)

Cronbachs
alpha value
()

Validity Analysis
Validity of the survey instrument is as important as reliability for the best
outcome from the study. Factor analysis was used to test the validity of the instrument by
identifying the interactions between the variables within the survey instrument. Although
final elimination of the questions can be a subjective process, factor analysis provides
important clues as to the validity of the questions in each construct (Cooper & Schindler,
2008).
There is no concrete formula for defining the adequacy of the samples, and one
can find many debates among academics about the adequate sample size to be used for
73

conducting factor analysis. Several early studies stressed the need for a minimum sample
number; however, later studies demonstrate that it is possible to conduct exploratory
factor analysis with small sample sizes (De Winter, Dodou, & Wieringa, 2009).
Additionally, Field (2000) showed that as long as the ratio of observations to variables is
at least 15, the results of exploratory factor analysis could be considered valid. Kaiser and
Rice (1974) recommended that KaiserMeyerOlkin (KMO) measure should be
minimum 0.5 and values over 0.9 are excellent. In the survey study, 53 responses were
collected for each question; hence, the criterion of a minimum of 15 responses to each
question was met for the study. The KMO was used to measure the sampling adequacy
and Bartletts test of sphericity was used to test the null hypothesis that the variables in
the population correlation matrix were uncorrelated (Garca-Santilln, Chvez, BoggeroCorrea, & Vela-Aguilar, 2012). These two tests determine whether one can perform
further factor analysis on a particular construct (Walker & Madden, 2009). It is
concluded that the strength of the relationship among variables is strong. It is a good idea
to proceed with a factor analysis for the data.
In addition to the KMO measure and Bartletts test, other factor analysis results
considered for each construct were the total variance tables, the component matrices
tables, and the commonalities tables. For specific statistical results regarding validity and
reliability tests for each construct, please refer to Appendix B.
Validity and Reliability for the Constructs
Transparency. The KMO test for the Transparency construct had a value of
0.471, which is less than acceptable value of 0.5. The level of significance in Bartletts
test of sphericity result was only 0.000, which is not absolutely not significant. Based on
74

the argument of Foulger (1979), the researcher decided to accept the null hypothesis and
proceed for the further factor analysis. Additionally, the initial reliability test for the
transparency construct showed the significant internal reliability at the acceptable level of
Cronbachs alpha = .795. Upon inspection of the questions, it appeared that when asked
together, the last question about the procurements adherence to the annual procurement
plan was redundant. As the research was more interested, in this particular construct, in
determining if the e-procurement system significantly contributes to enhance
transparency of procurement processes and information in public procurement, the
question could have been extracted from the list to enhance the Cronbachs alpha and
improve the overall reliability.
For the Transparency construct, using the principal component analysis factor
extraction method and examining total variance explained, component matrix, and
communalities tables provided the basis for deciding that all the questions in this
construct could be correlated to the first eight factors (questions). The total variance
explained indicated that 73.405% of the total variance could be explained by the first
eight questions of the construct, as each of the eigenvalues for these questions are greater
than 1. Each one of these component questions remains in the survey. Additionally, the
component matrix demonstrated that all of the questions correlated well to at least one
other question in the construct. Finally, the communalities values showed the extracted
values for each question in the construct to be well over the required .45 level considered
minimally acceptable (Walker & Madden, 2009).
Accountability. The KMO measure and the Bartletts test for the Accountability
construct showed that further factor analysis was possible for this construct. The KMO
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measure was .819 much above the minimum .5 required for sampling adequacy whereas
the significance level resulting .000 of the Bartletts test of sphericity showed the
accountability construct could be seen as a correlation matrix, indicating that further
factor analysis would be possible.
For the Accountability construct, using the principal component analysis factor
extraction method and examining total variance explained, component matrix, and
communalities tables provided the basis for deciding that all the questions in this
construct could be correlated to the first three factors (questions). The total variance
explained indicated that 70.046% of the total variance could be explained by the first
three questions of the construct, as each of the eigenvalues for these questions are greater
than 1. Each one of these component questions remained in the survey. Additionally, the
component matrix demonstrated that all of the questions correlated well to at least one
other question in the construct. Finally, the communalities values showed the extracted
values for each question in the construct to be well over the required .45 level considered
minimally acceptable (Walker & Madden, 2009).
The Accountability construct showed a highly acceptable level of reliability, with
a Cronbachs alpha of 0.910. All the questions were fit for the final survey. No further
improvement of Cronbachs alpha was required.
Corruption Control. The KMO measure and Bartletts test for the Corruption
Control construct showed that further factor analysis was possible for this construct. The
KMO measure was .748 above the minimum .5 required for sampling adequacy, whereas
the significance level resulting .000 of the Bartletts test of sphericity showed the

76

Corruption Control construct could be seen as a correlation matrix, indicating that further
factor analysis would be possible.
For the Corruption Control construct, using the principal component analysis
factor extraction method and examining total variance explained, component matrix, and
communalities tables provided the basis for deciding that all the questions in this
construct could be correlated to the first factor (question). The total variance explained
indicated that 65.783% of the total variance could be explained by the first question of
the construct, as the eigenvalue for the question is greater than 1. Each one of these
component questions remained in the survey. Additionally, the component matrix
demonstrated that all of the questions correlated well to at least one other question in the
construct.
Finally, the communalities values showed the extracted values for each question
in the construct were well over the required level of .45 except for the first question. The
extracted value for the first question was .429 marginally below the required level of .45.
Communality shows how much of the variance in the variables has been accounted for by
the extracted factors. For instance, 82.8% of the variance in response to the survey
question about the list of debarred/suspended bidders being publicly listed and
automatically verifying the winning bidder against the debarred/suspended bidders
database is accounted for, whereas 42.9% of the variance in response to the survey
question about the e-procurement-system-based bidding requiring
suppliers/contractors/procurement personnel to submit or testify that they have not been
involved in corrupt activities in the past is accounted for.

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The Corruption Control construct showed an acceptable level of reliability, with a


Cronbachs alpha of 0.811. All the questions were fit for the final survey. No further
improvement of Cronbachs alpha was required.
Efficiency, Effectiveness, and Predictability. The KMO measure and Bartletts
test for the Efficiency, Effectiveness, and Predictability construct showed that further
factor analysis was possible for this construct. The KMO measure was .828 much above
the minimum .5 required for sampling adequacy and the significance level of Bartletts
test of sphericity being .000 showed the Efficiency, Effectiveness, and Predictability
construct could be seen as a correlation matrix, indicating that further factor analysis
would be possible.
Using the principal component analysis factor extraction method and examining
the total variance explained, component matrix, and communalities tables for the
Efficiency, Effectiveness, and Predictability construct, it was determined that all the
questions in this construct could be correlated to the first two factors (questions) in this
construct. The total variance explained for this construct showed that 58.898% of the
total variance could be explained by the first two questions of the construct, with these
eigenvalues all being greater than 1. These two components remained in the survey.
Additionally, the component matrix showed all of the questions correlated well to at least
one other question in the construct.
Although the commonalities values showed the extracted values for each question
in the construct to be well over the required .45 level considered minimally acceptable
(Walker & Madden, 2009), there were two questions that did not correlate to the
extracted factors as well as the other questions in the Efficiency, Effectiveness, and
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Predictability construct. The extracted measure for the question about the enhancing of
efficiency and effectiveness in public procurement process was .484 and the extracted
measure for the question about ensuring the value-for-money was .404. Because the
questions were important for assessing the perception of the users and the overall validity
and reliability of the construct were acceptable, the questions remained in the survey
questionnaire.
The initial reliability statistics for the initial two survey questions about the
availability of evaluation and contract management modules and adequacy of authority
given to public entity users indicated an unacceptably low level of reliability of .788 for
the entire construct. However, the reliability of the entire Efficiency, Effectiveness, and
Predictability construct could have been improved considerably if those two questions
were removed or elaborated more. When the entire construct was looked at holistically,
the question about value-for-money could have been misunderstood, as thus so far, the
value-for-money in procurements is not taken so seriously.
Easy Access. The KMO measure and Bartletts test for the Easy Access construct
showed that further factor analysis was possible for this construct. The KMO measure
was .633 above the minimum .5 required for sampling adequacy and the significance
level of Bartletts test of sphericity showed .000 and the Easy Access construct could be
seen as a correlation matrix, indicating that further factor analysis would be possible.
Using the principal component analysis factor extraction method and examining
the total variance explained, component matrix, and commonalities tables for the Rule of
Law and Equity construct, it was determined that all the questions in this construct could
be correlated to the first three factors (questions) in this construct. The total variance
79

explained for this construct showed that 63.853% of the total variance could be explained
by the first three questions of the construct, with these eigenvalues all being greater than
1. These three components remained in the survey. Additionally, the component matrix
showed all of the questions correlated well to at least one other question in the construct.
Although the communalities values showed the extracted values for each question
in the construct to be well over the required .45 level considered minimally acceptable
(Walker & Madden, 2009), there were two questions that did not perfectly correlate to the
extracted factors as well as the other questions in the Easy Access construct. The
extracted measure for the question about the bid document reuse was .597 and the
extracted measure for the question about bid preparation using online forms was .588.
Although both of these measures were above the generally accepted value of .45, they
were both significantly below the extracted scores of all of the other questions.
Upon further examination of these two questions in the group discussions, it was
identified that neither of these questions were available in the e-procurement system so
far. The questions were not removed from the survey, as these questions were important
for assessing the perception on the international best practices.
The initial reliability statistics for the Easy Access construct indicated an
acceptable level of reliability of .640 for the entire construct. However, the reliability of
the entire Easy Access construct could be improved considerably if the questions about
bid document reuse and bid preparation using online forms were removed.
Rule of Law and Equity. The KMO measure and Bartletts test for the Rule of
Law and Equity construct showed that further factor analysis was possible for this
construct. The KMO measure was .637 above the minimum .5 required for sampling
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adequacy and the significance level of Bartletts test of sphericity showed .000 and the
Rule of Law and Equity construct could be seen as a correlation matrix, indicating that
further factor analysis would be possible.
Using the principal component analysis factor extraction method and examining
the total variance explained, component matrix, and commonalities tables for the Rule of
Law and Equity construct, it was determined that all the questions in this construct could
be correlated to the first two factors (questions) in this construct. The total variance
explained for this construct showed that 54.473% of the total variance could be explained
by the first two questions of the construct, with these eigenvalues all being greater than 1.
These two components remained in the survey. Additionally, the component matrix
showed all of the questions correlated well to at least one other question in the construct.
Although the communalities values showed the extracted values for each question
in the construct to be well over the required .45 level considered minimally acceptable
(Walker & Madden, 2009), there were two questions below the needed level. The
extracted measure for Question 4 about enhancing the citizen trust was .409, and
Question 7 about ensuring equal opportunity for all biddersdomestic or international,
small or large, and from cities or remote villageswas .364. Although both of these
measures were above the generally accepted value of .45, they were both significantly
below the extracted scores of all of the other questions.
Upon further examination of these two questions in the group discussions, it was
identified that neither of these questions were easy to answer. In case of enhancing trust
by e-procurement, all of three groups of stakeholders believe positively but it is too early
to correctly respond to this question. In case of Question 7, although procuring entities
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and regulatory/oversight agencies believed the technology could provide such


opportunity, it was confusing in the bidding community because of the heterogeneous
distribution of the Internet connectivity and access to information and communications
technologies could be the barrier for the country. The questions were not removed from
the survey, as these questions were important for assessing the perception on citizen trust
and the equal treatment to the users through the use of e-procurement system.
The initial reliability statistics for the Rule of Law and Equity construct indicated
an acceptable level of reliability of .692 for the entire construct. However, the reliability
of the entire Rule of Law and Equity construct could be improved considerably if the
questions about citizen trust and the equal treatment to the bidders were clarified upfront.
Civil Society Awareness. The KMO measure and Bartletts test for the Civil
Society Awareness construct showed that further factor analysis was possible for this
construct. The KMO measure was .752 above the minimum .5 required for sampling
adequacy and the significance level of Bartletts test of sphericity showed .000. The Civil
Society Awareness construct could be seen as a correlation matrix, indicating that further
factor analysis would be possible.
Using the principal component analysis factor extraction method and examining
the total variance explained, component matrix, and commonalities tables for the Civil
Society Awareness construct, it was determined that all the questions in this construct
could be correlated to the first factor (question) in this construct. The total variance
explained for this construct showed that 66.682% of the total variance could be explained
by the first question alone of the construct, with these eigenvalues all being greater than

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1. The component remained in the survey. Additionally, the component matrix showed
all of the questions correlated well to at least one other question in the construct.
Although the communalities values showed the extracted values for each question
in the construct to be well over the required .45 level considered minimally acceptable
(Walker & Madden, 2009), the first question was significantly below the needed level.
The extracted measure for the first question about the adequacy of the information
published by the procuring entities was .007. Upon further examination of the first
question in the group discussions, it was identified that the procuring entities were seen
reluctant to disclose adequate information for the general public as the procuring entities
are still not sure how much information to disclose to the general public. There is still no
policy and information classification system in the country for such information
disclosure. The question was not removed from the survey, as the question was important
for assessing the perception on the information disclosure on public procurement by
public entities to the civil society through the use of e-procurement system.
The initial reliability statistics for the Civil Society Awareness construct indicated
an acceptable level of reliability of .771 for the entire construct. However, the reliability
of the entire Civil Society Awareness construct could be improved considerably if the
question about information disclosure was clarified upfront.
The good governance construct results are summarized in Table 2.

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Table 2. Summary of Good Governance Construct Results


KaiserMeyer
Olkin measure

Bartletts test
of sphericity

Cronbachs
alpha value ()

Transparency

0.471

0.000

0.795

Accountability

0.819

0.000

0.910

Corruption Control

0.748

0.000

0.811

Efficiency, Effectiveness, and Predictability

0.828

0.000

0.788

Easy Access

0.633

0.000

0.640

Rule of Law and Equity

0.637

0.000

0.692

Civil Society Awareness

0.752

0.000

0.771

Construct

Data Collection
The survey questionnaire was designed, tested and finalized initially up to Step 8
of the utilization-focused evaluation (Patton, 2012a). After revision of the questionnaire,
67 participants were recruited from public entities, bidders, and regulatory/oversight
agencies. Among them, 35 responses were received from the public entity users, 11
responses from bidders, and 6 responses from the regulatory/oversight agency users were
received within 12 weeks. Fifteen participants did not return the responses. The
hypothesis testing that the e-procurement system contributes to enhance good governance
in public procurement was accomplished through the responses of 52 participants.
Analysis: Demographics of Survey Participants
The questionnaire was sent to a total of 67 participants. In total 52 respondents
from the three groups of respondent, public entities, bidders, and regulatory/oversight
agencies completed the questionnaire. The respondent profile is presented in Table 3.
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Table 3. Study Respondent Demographics


Demographic

Respondent

Age group (in years)


Under 25
2545
4565
Over 65

1
27
24
0

1.92%
51.92%
46.15%
0.00%

E-procurement system user type


Regulatory/oversight agency
Public entity
Bidder

6
35
11

11.54%
67.31%
21.15%

Years of e-procurement use


Less than 2 years
25 years
More than 5 years
Not applicable

23
22
5
2

44.23%
42.31%
9.62%
3.85%

Annual participation in e-procurement


Less than 5 times
Between 510 times
Between 1020 times
More than 20 times

5
12
11
24

9.62%
23.08%
21.15%
46.15%

Over 66% of the 52 respondents were from 14 public entities, 22.64% of the
respondents were from private firms, and two regulatory/oversight agencies using eprocurement system.
Over 9% of the respondents were using e-procurement system for more than 5
years either in their own organizational level or using the national e-procurement system,
over 43% of the respondents have been using e-procurement system for the last 25
years, and over 43% of the respondents are new using for less than 2 years. Two
respondents from the oversight agencies were concerned with the e-procurement system,
but they do not use the system for their oversight purposes as of now, as the eprocurement system still does not provide such access for the oversight agencies.
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Over 47% of the respondents participate in the e-procurement for bidding


purposes more than 20 times, 20.75% participate between 1020 times, 22.64%
participate between 510 times, and only 9.43% participate less than 5 times.
Among the participants, 52.83% were between 2545 years old, 45.28% were
between 4565 years old, and only one respondent was less than 25 years old. No one
from the participants was over 65 years old.
In summary, all the stakeholder groups were represented in the survey and focus
group discussions. Contacting public entities was easier as the entities had designated
focal persons to contact for the coordination, but contacting bidding community was
comparatively difficult because of their engagements in different contract in different
parts of the country.
Analysis: Hypothesis Testing Results
This analysis formulates inferences using the constructs of the seven specific
variables of the study. The hypothesis testing was done using both the Friedman test and
the chi-square goodness-of-fit test for nonparametric samples. This test compares three or
more related variables without making assumptions about their distribution. Each
question in a variable construct was itself considered a separate variable, with the entire
construct being tested in its totality using the Friedman test. For each of the tested
variablesTransparency; Accountability; Corruption Control; Efficiency, Effectiveness,
and Predictability; Easy Access; Rule of Law Equity; and Civil Society Awarenessif
there were no effect by any of the questions on each variable, the Likert rankings would
be spread out at random over the variables. However, if the null hypothesis is rejected,
then it is assumed that at least one of the questions invoked a significant opinion about
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the effectiveness of the variable in question (Laerd Statistics, n.d.). The composite null
hypothesis was that the e-procurement system does not significantly contribute to
enhance good governance in public procurement. As the hypothesis test shows Friedman
test (2 = 139.623, df = 6, sig. = .000) at the = 0.05 level of significance, there is
enough evidence to conclude that the e-procurement system significantly contributes to
enhance good governance in the public procurement sector.
As the study used a discrete ordinal, 5-point Likert scale with unknown
distributions of any of the variables and could not assume normality of the responses, chisquare tests (Friedman and goodness-of-fit tests) were used either to reject or fail to reject
the null hypothesis for each variable. Discussion of the results for each of these variables
and their constructs follows.
Data analysis tables for each variable and corresponding construct can be found in
Appendix C.
Survey Results
Transparency
The null hypothesis for this variable was defined, as the e-procurement system
does not significantly enhance transparency of procurement processes and information in
public procurement. Twenty-four questions were asked concerning the transparency in eprocurement that contributes good governance in the public procurement sector. The
study covered the questions to assess the perception and experience of the respondents in
the e-procurement system on the publishing of the Public Procurement Act and Public
Procurement Regulations, e-procurement guidelines, publication of annual procurement
plans, publication of bidding opportunities, disclosure of condition of participation,
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evaluation criteria, criteria on domestic preferences, publication of amendments and


clarification to bidding document, sharing bid opening records, publication of contract
award details, level of automation in e-procurement system, and other aspects of the best
practices in e-procurement.
The Friedman chi-square test for the goodness-for-fit confirmed that eprocurement contributes to enhance transparency in public procurement, as the test
rejected the null hypothesis on all the 24 questions at the = 0.05 level of significance.
Most of the questions reflected the respondents perceptions that the e-procurement
significantly contributes to transparency aspect of good governance.
Minor exceptions in the transparency construct have to do with the features about
the transaction traceability through audit trails (Question 16), and ensuring the
availability of budget before publishing invitation to bid in e-procurement system
(Question 23). The chi-square tests for these questions had the significance level at the
higher range (i.e., significance level was .033). The questions asked about the
transparency in e-procurement were designed to understand the perception of the
respondents on the degree of importance of each of the transparency features in eprocurement, and availability of those features in the e-procurement system the
respondents are using.
The data shows that the respondents understand that the existing e-procurement
system does not provide adequate traceability of the procurement processes and also
lacks the functionality to ensure the availability of budget before publishing invitation to
bid. These functions should be made available in the second phase of the e-GP system
implementation.
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Accountability
The null hypothesis for this variable was defined as the e-procurement system
does not significantly contribute to enhance accountability of the actions in public
procurement. Fifteen questions were asked concerning the accountability in eprocurement that contributes good governance in the public procurement sector. The
study covered the questions to assess the perception and experience of the respondents in
the e-procurement system on the provisions of the keeping records of approvals process
and approvers at different stages of procurement. In procurements, the records of
prequalification and postqualification of bidders, negotiation with them, details of
payments made and contract amendments are very crucial for the judgment of
accountability of the procurement officials. Equally important is the responsiveness of the
authorized public officers on timely handling complaints submitted by the bidders and
other decision making processes before contract awards and during the contract execution
time.
It was found that the respondents believe that the e-procurement strengthens the
accountability of the public officers through standard workflow process based on
incorporated authority in the e-procurement system. The Friedman test (2 = 195.092, df
= 6, sig. = .000) and chi-square test for the goodness-for-fit confirmed that the eprocurement contributes to enhance accountability in public procurement, as the test
rejected the null hypothesis on 14 out of 15 questions at the = 0.05 level of significance.
Fourteen questions reflected the respondents perception and experience that the eprocurement significantly contributes to accountability aspect of good governance.

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One exception in the accountability construct is about the potential suppliers


having effective and timely access to complaint review decisions and those complaints
are promptly resolved (Question 11). The chi-square goodness-for-fit test for the question
had high level of significance = .078. Therefore, it is assumed the respondents did not
experience the effective implementation of the feature about complaint access, review
and resolution in the e-procurement system.
Corruption Control
The null hypothesis for this variable was defined as the e-procurement system
does not significantly contribute to enhance corruption control in public procurement.
Four questions were asked concerning the corruption control in e-procurement that
contributes good governance in the public procurement sector. The study covered the
questions to assess the perception and experience of the respondents in the e-procurement
system on the provisions bidding requiring the suppliers/contractors/procurement
personnel submitting or provision of testifying that they have not been involved in
corrupt activities in the past. The study also seeks procuring entities record feedback on
experience with suppliers at the completion of the contract to help public officials in
evaluating the supplier for future procurements. The e-procurement system triggers
system alert in case of officials try to use their discretion and unauthorized judgment,
which provides a level of measure for controlling corruption and achieving value-formoney.
Analysis found that the respondents agree that the e-procurement system helps
some level of controlling corruption, and the system provides tools for such control. The
Friedman chi-square test for the goodness-for-fit confirmed that the e-procurement
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contributes to enhance accountability in public procurement, as the test rejected the null
hypothesis of all the questions at the = 0.05 level of significance. Fourteen questions
reflected the respondents perception and experience that the e-procurement significantly
contributes to accountability aspect of good governance.
Efficiency, Effectiveness, and Predictability
The null hypothesis for this variable was defined as the e-procurement system
does not significantly contribute to enhance efficiency, effectiveness, and predictability
of procurement processes and information in public procurement. Eight questions were
asked concerning the efficiency, effectiveness, and predictability in e-procurement that
contributes good governance in the public procurement sector. The study covered the
questions to assess the perception and experience of the respondents in the e-procurement
system on the improvement in terms of effectiveness and effectiveness in procurement
process:

Reduction in processing time

Ensured adherence to the annual procurement plan and timely procurement

Reduction in the number of complaints and appeals against the decisions


made by the public entities

Provided procurement information and procurement plans upfront so that


bidders get time to plan

Improved administrative process (i.e., automated workflow with defined


authority and roles)

Enhanced predictability on decision timings

Ensures value-for-money

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The Friedman test (2 = 61.423, df = 7, sig. = .000) and chi-square test for the
goodness-for-fit confirmed that e-procurement contributes to enhance accountability in
public procurement, as the test rejected the null hypothesis of all the questions at the =
0.05 level of significance. All eight questions reflected the respondents perception and
experience that the e-procurement significantly contributes to efficiency, effectiveness,
and predictability aspects of good governance.
Easy Access
The null hypothesis for this variable was defined as the e-procurement system
does not significantly contribute to enhance easy access to procurement processes and
information in public procurement. Eight questions were asked concerning the easy
access in e-procurement that contributes good governance in the public procurement
sector. The study covered the questions to assess the perception and experience of the
respondents in the e-procurement system in terms of browsing speed of e-procurement
system and Internet bandwidth consumption, time required for getting registered to use
the system, affordability of registration fee, availability of previewing the bidding dossier
free of cost before buying the document, reusability of bidding dossier and bid
documents, availability of online forms for bid offer preparation, and completeness of the
e-procurement system to complete above 70% of procurement cycle through the system
itself.
The Friedman test (2 = 99.792, df = 7, sig. = .000) and chi-square test for the
goodness-for-fit confirmed that the e-procurement contributes to enhance easy access to
procurement processes and information in public procurement, as the test rejected the
null hypothesis of all the questions at the = 0.05 level of significance. Eight questions
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reflected the respondents perception and experience that the e-procurement significantly
contributes to easy access aspect of good governance.
Rule of Law and Equity
The null hypothesis for this variable was defined as the e-procurement system
does not significantly contribute to enhance the enforcement of the rule of law and equity
to all the bidders in public procurement.
Seven questions were asked concerning the rule of law and equal treatment to the
bidders in e-procurement that contributes good governance in the public procurement
sector. The study covered the questions to assess the perception and experience of the
respondents in the e-procurement system that helps in terms of

Complying with procurement laws and regulations

Help in public procurement reform

Standardizing the public procurement process for better administration across


all the procuring entities in the country

Enhancing citizen trust on public service connecting its stakeholders

Improving the administrative process in public procurement

Treating e-procurement system as an integral part of the public procurement


reform

Ensuring equal opportunity for all biddersdomestic or international, small


or large, and from cities or remote villages

The Friedman test (2 = 35.992, df = 6, sig. = .000) and chi-square test for the
goodness-for-fit confirmed that the e-procurement contributes to enhance the
enforcement of the rule of law and providing equal treatment to all the bidders in public

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procurement, as the test rejected the null hypothesis of all the questions at the = 0.05
level of significance.
Seven questions reflected the respondents perception and experience that the eprocurement significantly contributes to enhance the enforcement of rule of law and
equity aspects of good governance.
Civil Society Awareness
The null hypothesis for this variable was defined as the e-procurement system
does not significantly contribute to enhance the public procurement awareness about
public procurement. Four questions were asked concerning the provisions made in the eprocurement system that contributes good governance in the public procurement sector.
The study covered the questions to assess the perception and experience of the
respondents in the e-procurement system asking whether the information disclosed by the
public entities are adequate, whether public online discussion forum on public
procurement is available, whether e-procurement system provides provision of
independent access for review for auditing to auditing agencies such as the Office of
Auditor General and oversight agencies such as the National Vigilance Centre, the AntiCorruption Bureau, Parliament, and ombudsmen/mediators, and whether e-procurement
system informs the civil society about the government expenditure that help in terms of
enhancing civil society awareness so that it can play a role of watchdog.
The Friedman test (2 = 41.699, df = 3, sig. = .000) and chi-square test for the
goodness-for-fit confirmed that e-procurement contributes to enhance the civil society
awareness in public procurement, as the test rejected the null hypothesis of all the
questions at the = 0.05 level of significance. Four questions reflected the respondents
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perception and experience that the e-procurement significantly contributes to enhance the
civil society awareness aspects of good governance.
Two-Way Analysis of Variance Test
These data were then analyzed using measures of central tendency, which
included the most common measures of mode, median, and the mean (Bernard, 2000),
factor analysis. A two-way analysis of variance test (see Table 4) was conducted in order
to determine if the research questions and the underlying hypotheses stated were
supported or not supported as well as to see the significance of the interactions between
dimensions (constructs or factors). These tests were conducted on sample data collected
under with seven constructs supported by 70 nonparametric questions from three groups
of e-procurement users of public entities, bidders, and regulatory/oversight agencies
involved in both procurement transactions and e-procurement system management. Table
4 values are not individual data points; they are all cell means with their own distribution.
In a two-way analysis of variance test, the way the distributions fit together is at
the very heart of the technique. Looking at the average mean data for each of the
stakeholder groups, it can be concluded that the stakeholders have similar perception
about the underlying hypothesis. The perception on the role of e-GP system in enhancing
the enforcement of the rule of law and create equal opportunities to the bidders scored the
highest support, and increasing efficiency, effectiveness, and predictability scored the
second. The Corruption Control dimension scored the least score as the e-GP improved
corruption control at certain stage but there are still other stages at which there is room
for improvement. All the stakeholders perceive that the transparency and easy access to
procurement information and bidding opportunities are well taken care by e-GP system.
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Table 4. Two-Way Analysis of Variance Test on Research Questions and Underlying


Hypotheses
Mean

Public entity

Regulatory/
oversight agency

Transparency

3.31

3.48

3.17

3.32

Accountability

2.74

2.79

2.82

2.78

Corruption Control

2.64

2.42

2.80

2.62

Efficiency, Effectiveness, and Predictability

3.30

3.85

3.78

3.64

Easy Access

3.00

3.21

3.58

3.26

Rule of Law and Equity

4.02

4.14

3.86

4.01

Civil Society Awareness

2.57

2.38

3.14

2.69

Average mean

3.08

3.18

3.31

3.19

Dimension of good governance

Bidder Dimension

Then, the marginal means values from Table 4 were plotted in a graph to see the
interactions between the dimensions (see Figure 6).
An interaction occurs when effect of one factor changes for different levels of the
other factor. In this case, the perception of stakeholder groups changes across the
dimensions of the good governance. For example, bidder perception was good in the case
of Transparency; Efficiency, Effectiveness, and Predictability; Easy Access; and Rule of
Law and Equity but it was not good for Accountability and Corruption Control. The
perception the Civil Society Awareness dimension was moderate. If there was no
interaction, the perception of the bidder line would always be above the other stakeholder
user group lines, and lines would not cross. On the marginal means graph, as a general
rule, lines cross because factors change across the groups.
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Figure 6. Marginal means of dimensions of good governance.

It is observed from the graph (see Figure 6) that three of the groups share the
same perception that there are interactions between the transparency and accountability.
Public entities and oversight regulatory agencies perceive that there is a relationship
between corruption control and efficiency, effectiveness, and predictability. Bidders and
Regulatory/oversight agencies believe that easy access to the information have significant
role on efficiency, effectiveness and predictability. Three of the focus groups perceive
that the e-procurement system is highly effective to enhance the rule of law and
competition among the bidders providing equal access to all. Regulatory/oversight

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agencies and bidders are more optimistic on that the e-procurement system enhances the
civil society awareness.
Focus Group Discussions
As a part of the research design, three focus group discussions were held with the
participants from the public entities, bidders, and regulatory/oversight agencies separately
after the preliminary analysis of the questionnaire survey, to validate and deepen the
understanding of the findings of the quantitative analysis, and establish the concluding
hypothesis of the study.
Focus groups are particularly useful when participants reasoning behind their
views is of interest, as well as the process by which participants develop and influence
each others ideas and opinions in the course of discussion. Guidelines provided in the
Steyaert and Lisoir (2005) indicated that the focus groups are useful to gauge the nature
and intensity of stakeholders concerns and values about the issues, obtain a snapshot of
public opinion when time constraints or finances do not allow a full review or survey
obtain input from individuals as well as interest groups, obtain detailed reaction and input
from a stakeholder or client group to preliminary proposals or options collect information
on the needs of stakeholders surrounding a particular issue or concept, and determine
what additional information or modification may be needed to develop consultation
issues or proposals further (p. 131).
A set of guiding key questions was prepared for the discussions. Opinion, issues,
feedback, concerns, and suggestions were noted in each of the discussions. Sequence of
discussion was agreed by the participant to follow question by question and by theme
(aspects) of good governance. Full consideration was taken to understand the levels of
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knowledge or different attitudes that may be relevant to the research and reflect on the
expected generalizability to the population at large (Steyaert & Lisoir, 2005). During the
discussion, themes were categorized into two categories, Perceptions and
Recommendations, for each of the constructs. And the perceptions and recommendations
for different themes that emerged from discussion were lumped when a consensus was
made in the group. Because the focus group discussion was carried out in small groups,
interaction was intense, and productive. Opinion of the participants and findings
deepened the understanding of why the survey scores were like they were, and in some
cases the discussion made clear why some cases that showed the outliers. The number of
voices really did not matter.
A total of 19 people participated in the three focus groups, 10 from public
procuring entities, five bidders, and four from the regulatory/oversight agencies.
Participants candidly put forward their perceptions, experience and suggestions during
the focus group discussion.
Transparency
Public entities. The public entities concluded that the transparency does not mean
to disclose everything. There should be clear policy on the disclosure of the information
to support the principles of the procurement and enhance good governance in the public
procurement sector. The transparency policy for the e-procurement should be prepared
based on the country context following the international best practices.
The participants noted that making the annual procurement plan and publishing
contract award information mandatory in the e-procurement portal was a good decision,
but preparation and adherence to the plan could be very difficult. The difficulty arises in
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matching the time of the preparation and approval of annual budget by the Ministry of
Finance, preparation of the annual procurement plan, and the publication of invitation to
bids. The annual procurement plan in the e-procurement portal gives prior knowledge to
the general public as well as the bidders about the planned procurements for the fiscal
year, and gives information on how and where the public fund is being spent. The bidders
will have opportunity to plan upfront their resources, capacity and management planning.
A few of the participants also expressed that an estimated budget also could be
published to reduce the problem of low bidding. The low bidding is the bid by the bidders
quoting very low just to win the contract. Issues like low quality of work, abandoning the
contract in the middle of the execution, and abusing the mobilization funds are rampant
because of low bidding. The participants suggested including the price index (schedule of
rate) of the common procurement items in the e-procurement system, which gives the
reference for the bidders, as well as public entities can take as a basis for preparing an
official estimate for the procurement.
In relation to the invitation to bids, the participants suggested that the eprocurement system should not allow to public invitation to bids until the budget is
secured for that specific procurement. In the current version of the e-procurement system,
bid-opening records are not shared with the bidders and bidders do not get to know the
status of bids until contract is awarded. Also there is no online public discussion forum in
the e-procurement for asking about, sharing about, and clarifying the procurement-related
issues. The participants mentioned that there is no option for debriefing in e-procurement
system, but expressed that it would be good to have in the system so that the bidders

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failed to win the contract will get to their weaknesses and improve in next bidding
process.
Bidders. The participants expressed that the public procurement has been more
transparency with the introduction of e-procurement system. They are happy that the
annual procurement plan and the invitation to bids by the public procuring entities using
e-procurement system. The participants think that the information on eligibility and
qualification criteria also should be published in the invitation to bids, and those criteria
should not be allowed to modify after publishing the invitation to bids. The participants
requested to publish the bid opening records as soon as the bids are opened. They think
that the information published on contract awards is not adequate. It does not tell on what
basis the contract was awarded or who the competitors were. They believe if those details
are published then the bidders could understand their merits and weaknesses and will be
able to prepare better bids next time. The participants suggested that the e-procurement
system should automatically send the notes of prebid conference, and clarifications to
bidding document to all the bidders timely. The participants also suggested publishing the
best evaluated bidders with their scores, and debriefing should be available.
Regulatory/oversight agencies. The participants expressed that the public
procurement has been more transparency with the introduction of e-procurement system
in the country complying with the regulatory framework and Rights to Information Act.
Publication of annual procurement plan was not mandatory so far in practice before the
introduction of e-procurement.
The public procurement regulatory and monitoring agency informed that the eprocurement system is going to be interfaced with the treasury and budget planning
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software of the Ministry of Finance, so that e-procurement system can easily verify the
availability of budget for the procurement, confirm the approved procurement plans, and
reconcile with the payments made to the contractors. The participants agreed that bid
opening records, and detailed contract award information should be published. The
participants mentioned that publishing the eligibility and qualifying criteria should be
possible and it should be considered in the next version of the e-procurement system. The
participants also agreed that based on the international best practices, debriefing of the
contract awards should be given if the bidder requests for that. The regulatory/oversight
agency participants agreed that the complaints and their review decisions should be made
transparent.
All the participants fully agreed that the e-procurement system has significantly
enhanced the transparency in public procurement. Additionally the participants provided
feedback to improve or provide new functionalities like debriefing, online public
discussion forums, publishing list of best evaluated bidders, and complaints and their
review decisions, which will ensure the transparency as well as good practice in public
procurement.
Accountability
Public entities. The participants felt that the accountability in the procurement
has been enhanced through the introduction of e-procurement system, as the system
keeps track of activities of the procurement officers from login to logout in the system.
They also agreed that there are provisions to be considered by the regulatory and
monitoring agency as asked in the questionnaire survey to include in the e-procurement
system. For example, e-procurement system does not ask for signing any code of conduct
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by the procurement personnel involved in the procurement processes for nondisclosure or


confidentiality.
The participants agreed that the e-procurement system should give login access to
all the authorized and accountable officers of the procurement so that they can carry out
their responsibility by themselves. Currently, in some cases, user login facility is given to
only one person from a public entity, which may result into repudiation by the
responsible officer. In many public entities, procurement personnel are not trained in
using computer systems and applications. Accountability is diluted when the procurement
officers share user name and password to the person who knows computer or to the
information technology staff, who carry out the actual operations in the e-procurement
system on their behalf. Frequent transfer of employees is another problem in case of
accountability. Also the procurement officials often do not use their official e-mail
addresses, so the notifications go to their personal e-mail boxes. Therefore, when
procurement employees are transferred, the user account and procurement-related
information received through the e-procurement system are lost. The participants
suggested either using the e-mail account of the respective public entity or that the eprocurement system should provide e-mail accounts for all of its users. As per the
procuring entities, only 5% of the government officials use official e-mail accounts.
The participants expressed that the e-procurement system still does not provide
contract management function, which is the major area in which accountability issues are
weak. Additionally, the participants strongly recommended that the use of official e-mail
should be made mandatory for the public officer using e-procurement system.

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Bidders. The participants argue that the public entity officials are not adequately
given authority to make decisions. The participants suggested that the public entity
officials could be made more accountable by giving appropriate authority, defining
timeline for actions, rewards for accomplishments and punishment or room for
improvement should be provisioned, and those should be built in to the e-procurement
system. The workflow process is in the e-procurement system but should be linked with
their threshold of approving authority and given mandates or roles. In case of bidders
accountability, it is good that all the activities of the bidders are also recorded by the eprocurement system, which makes the bidders feel accountable to their actions and they
cannot repudiate their actions.
Regulatory/oversight agencies. The participants expressed their satisfaction on
that the e-procurement system is based on workflow, and all the activities of the public
officers and bidders, as well as the users of the regulatory and monitoring agency are
recorded. The accountability of the actions are enhanced as the transactions and persons
doing the transactions could be tracked and investigated if required. The participants
suggested that the role-based authority given by the government to the public officers for
the procurement should be built in to in the e-procurement system and also suggested to
incorporate robust contract management system in the e-procurement system.
The participants suggested that if the quality assurance, payments, contract
variations, role-based authority of officers defined, complaint and dispute managements
are incorporated in the e-procurement system, it will drastically enhance the
accountability and good governance in public procurement.

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Corruption Control
Public entities. The participants agree that the corruption control in the
procurement has been significantly enhanced through the introduction of e-procurement
system. Corruption is a vague phenomenon, which is rampant in different stages of the
procurement life cycle. The participants fully agree that face-to-face interaction should be
completely stopped in e-procurement system to minimize the corruption in procurements.
All of the participants agree that a regular phenomenon of clash among the bidders on the
last day of bid submission preventing each other from dropping bid documents is
completely stopped because of the e-procurement. Internal control in the public entity on
procurement also has been increased because the e-procurement system records all the
activities. Currently, there are at least one to two moments when bidders have face-toface contact with the procuring entity even in case of using e-procurement system. The
first event is based on the provisions made in the existing Public Procurement
Regulations. Bidders are supposed to submit the original copy of bid security to the
procuring entity to ensure the commitment of the bidders in the specific tender. The
second event is when the procuring entity may request the bidder to submit the hardcopy
of the bid, which was submitted online through the e-procurement system, if the bidder is
among the significantly responsive bidders. At the time of hardcopy submission, public
entities come to know who has submitted bids online, and that information may be passed
to other bidders, and from there a collusive act may start. The participants suggested to
stop the requirement of parallel submission of bids online and hardcopy as well as to find
the ways to receive bid securities electronically.

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Bidders. The participants expressed that the corruption at the prebid submission
stage of procurement has been controlled because of the online availability of bidding
documents, and online submission of the bids. The bidders admitted that in many cases
corruption from the time of bid security submission and contract signing to contract
completion are still not controlled. The participants suggested that there should be an
easy way to submit bid securities, and hardcopy submission of bids should be completely
stopped. They also admitted that there is no strict control mechanism for the quality
assurance, payments, expenditures, and site monitoring. The e-procurement system
should address these recommendations by automating all the activities including the
submission of bid securities, and all information required to complete a bidding process.
The e-procurement system can provide greater control by developing a comprehensive econtract management system, linking with the quality control, payments and expenditure
tracking mechanism in the Ministry of Finance. The participants expressed that there may
be resistance from the public entities side to implement the contract management system;
however, it will be very helpful for the contractors.
Regulatory/oversight agencies. The participants agreed that the process-based
corruption control is significantly enhanced but it is difficult to control the corrupt
activities happening outside the e-procurement system. In many cases, contractors also
abuse payments made for the mobilization of the contracts by not utilizing the received
fund for that contract but investing it somewhere else. The e-procurement system should
have effective tools to track and control the payment, fund expenditure by the contractor
and outcome of that, and linkage with the delivery milestones. The regulatory/oversight
agency participants asserted that the incidences of fights among bidders at the time of bid
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submission are not recorded so far since the introduction of e-procurement system. The
participants also agree that e-procurement has reduced collusion among bidders and
procuring entities by providing information about tenders to firms, allowing noncartel
firms to participate and breaking up local bidding cartels. E-procurement can also
potentially mitigate corruption by reducing the degree to which government officials
selectively withhold information or refuse to take bids from nonfavored bidders.
The participants believe that when all the processes of procurement are automated
and incorporated in the e-procurement system, corruption control can be sustained and
can significantly enhance the good governance.
Effectiveness, Efficiency, and Predictability
Public entities. The first important factor for efficiency gain is that any bidder
can now access the government procurement opportunities from a single e-procurement
portal. Bidders can prepare their bids online and submit the bid at their own pace online
till the deadline of online submission time. The one clear finding here was that the
requirement of parallel submission both online bid and hardcopy bids should be
completely stopped, and allow only online submission. This has created a redundancy in
the public entities requiring additional resources to verify the information in the bids
submitted online and offline.
Standard bidding document templates for the procurement of goods and services
are available as web forms, so it is easier to prepare the bidding documents, and it has
drastically reduced the bid document preparation time. There is built-in workflow for the
approval process, so the time for administrative processing also has been reduced, and
predictability of the procurement and contract processes has been increased. The
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participants believe that cost reduction in the unit rates of the items are observed but that
should be carefully calculated over the time. Sometimes, because of the low bidding, the
public entities are facing problem in contract execution time. The participants also
requested to link the bid submission and evaluation function with the database of
blacklisted or suspended contractors and suppliers for verification. The e-procurement
system should have provisions of generating ad hoc reports on specific projects,
expenses, bid securities and performance guarantees validity tracking, forfeiture, release
and extension, and so on. The participants believe that if the contractor appraisal is tied
with the contract closure, it will help enhance the effectiveness. The e-procurement
should not end its scope just after a contract is awarded. It was suggested to develop a
comprehensive project management tool to achieve the significant enhancement in
efficiency, effectiveness, and predictability.
The participants agree that the mandatory requirement of publishing annual
procurement plan, standardization of the bidding document and forms, availability of the
administrative workflow has enhanced the efficiency, effectiveness, and predictability in
procurement processes.
Bidders. The participants in the focus group discussion expressed that the bid
securities and performance guarantees submission should be made simple, so that the bid
submission process will be efficient for the bidders. Currently, the bid securities are
submitted in hardcopy within 35 days of bid opening. The participants agreed that the
efficiency and effectiveness has been enhanced because of online bid document
preparation and submission. Predictability is enhanced because of the availability of the
annual procurement plans.
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Regulatory/oversight agencies. The participants believe that efficiency and


effectiveness is enhanced by saving cost and time through the reduction in publishing
invitation to bids in daily newspapers, savings on printing bidding documents by public
entities, and improvements in standardized workflow across the public entities.
Requirement of preparing annual procurement plan and publishing it for public made the
activities predictable to the public entities as well.
The participants from three of the groups believe that the efficiency,
effectiveness, and predictability in the procurement have been significantly enhanced
through the introduction of e-procurement system by standardization of the procurement
processes, bidding documents, forms, and provision of online bid submission. Cost
reductions is achieved through reduction in publishing invitation to bids in e-procurement
system than in daily newspapers, reduction in the use of papers, and by administrative
process simplification. Stopping the parallel submission of bids, online and offline, and
development of a comprehensive contract management tool may even significantly
support the sustainability of these aspects in the procurement processes.
Easy Access
Public entities. The participants from the public entities are happy that all the
documents related to one procurement are available online in one place and can be easily
accessed. Despite the slow Internet connectivity, bidding documents can be prepared
easily and in a short time. Although some of the participants requested to upgrade the
data center and also increase the Internet connectivity for the e-procurement, most of the
participants were happy with the current speed of access. They did not have any issues
related to user registration, as the registration of the public entities is done by the
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regulatory and monitoring agency itself in the current version of the e-procurement
system. The participants suggested improving on the consistency of web pages in terms
of content identity, font, and access links to functionalities.
Bidders. The participants praised the provision of free registration of the bidders
and also availability of downloading bidding documents without any cost. The
participants requested to build facility to send Short Message Service alerts along with
the e-mails to the bidders from the e-procurement system when any new procurement
opportunity of interest to the specific category of bidders is published in the eprocurement portal. There should be a provision to indicate the area of business or their
interested business areas at the time of registration in the e-procurement system. This will
be useful and effective for the bidders to enhance access to procurement information. The
Short Message Service alert will encourage the small and big contractors to participate in
the government procurements based on their capacity.
Regulatory/oversight agencies. The e-procurement system still does not provide
dedicated content access to the regulatory/oversight agencies. It was recommended to
give access to the regulatory/oversight agencies on the reports on compliance and
performance tracking, as well as audit trail records of the transactions on case-by-case
basis.
The participants believe that the easy access to the procurement processes and
information have been significantly enhanced through the introduction of e-procurement
system. The participants suggested to enable Short-Message-Service-based automated
alert to the bidders on the new bidding opportunities in the e-procurement system. The
participants also suggested improving on the consistency of web pages in terms of
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content identity, font and access links to functionalities. It was recommended to provide
regulatory/oversight agencies access to the reports and also transactions audit trails for
the investigation of the specific cases.
Rule of Law and Equity
Public entities. The participants believe that the compliance with the Public
Procurement Act and Public Procurement Regulations, and also equal treatment to the
bidders have been significantly improved, as the e-procurement system is configured
according to the requirements of the act, regulations, and government directives,
provisions of which are automatically verified by the system at every stage of transaction.
Procurement workflows are configured based on the administrative authority and paperbased standard bidding documents are reengineered and built in to in the e-procurement
system, ensuring the standardized procurement processes and documentations. Bid
submission has been easier as the system does not allow submitting the bids until the
bidders submit all the requested documents, which in turn support to increase the
responsiveness of the submitted bids. Bidders are treated equal, as the status of the
bidders remains anonymous to the procuring entity until the time of bid opening. The
participants suggested making the feature of automatic verification of contract approval
thresholds for different officers assigned for different roles in the workflow, so that the
chance of making mistake to approve any transaction beyond their authority could be
checked. It was discussed also on the issue of authenticity of the electronic transactions.
Despite having electronic transaction act in the country, the participants raised the
concerns that all the legal, technical and other provisions should be documented in the
form of e-procurement guidelines with the endorsement from the Ministry of Finance or
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Cabinet of Ministers to give a legal status of the procurements carried out through the
electronic medium. This may enhance the citizen trust on e-procurement as well.
Bidders. The participants agreed that the compliance with the requirements of the
procurement has been very easy, as the e-procurement system does not allow to submit
the bids until the requirements are fulfilled. The e-procurement can now ensure the
compliance even for those who are not aware about the Public Procurement Act and
Public Procurement Regulations. The participants expressed that there should be easy
way to submit complaints in the e-procurement system. They also expressed that there
should be e-procurement manuals to follow the right rules in case of e-procurements.
Regulatory/oversight agencies. It has been easier for the regulatory/oversight
agencies also because of the streamlined process and standardization of documents in
compliance with the Public Procurement Act and Public Procurement Regulations. The
participants agreed that there should be e-procurement guidelines with adequate legal
status to ensure the authenticity of the practices and transactions carried out through the
e-procurement system.
The participants in the three of the focus groups believe that the rule of law and
equity in procurements have been significantly enhanced through the introduction of eprocurement system through the incorporation of standardized procurement processes,
workflow with administrative authority, and automated compliance checking by the eprocurement system. The participants recommended making public e-procurement
guidelines to give authenticity to the electronic procurement transactions. They also
recommended that the contract approval threshold of the official in the procuring entity
should also be available in the workflow process.
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Civil Society Awareness


Public entities. The participants believe that the information published about
procurement plans, invitation to bids, contract award information in the e-procurement
system are adequate for the awareness of the general public. Currently, the regulatory and
monitoring agency has access to the administrative control panel and the agency is
monitoring the regulatory and fiduciary compliance in the e-procurement system. The
participants suggested providing such access to the Public Procurement Review
Committee as well, who are responsible for handling complaints and appeal procedures
of the procurement process. The participants believe that the civil society is now a lot
more positive, and encouraging the use of e-procurement in all the public procuring
entities.
Bidders. The participants believe that the level of general public awareness has
been raised about the e-procurement. There should be regular publication of annual
procurement performance reports in the e-procurement portal to inform the general public
about the government expenditure on the procurements.
Regulatory/oversight agencies. The regulatory/oversight agency participants
agreed that the complaints and their review decisions should be made public for the
public society awareness so that the civil society can play a role of watchdog in society.
The participants in three of the groups agree that the awareness about the public
procurement in general public has been significantly improved, because of the increased
transparency measures provisioned in the e-procurement system. The participants
recommended providing access on complaint handling issues to the Public Procurement

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Review Committee, publish annual procurement performance report as well as publish


the decisions made on the complaints submitted by the bidders.
Summary
The action research examined seven aspects related to good governance in public
procurement within the framework of e-procurement system implemented in the host
country for this research. The data were analyzed using quantitative methods (survey)
and also qualitative methods (focus group discussions).
From the quantitative methods, for each of the variables in question the null
hypothesis was rejected with the alternative hypotheses being accepted. Three
participatory focus group discussions with the public procuring entities, bidders, and
regulatory/oversight agencies were carried out as the study was focused on values such as
transparency, accountability, merit, legality, and legitimacy, which, in the context of the
good governance paradigm require civic participation and engagement (Hood & Lodge,
2004). Three of the groups perceived and agreed that these aspects of good governance in
public procurement have been significantly enhanced because of the introduction of the
e-procurement in the country.
Action research also provided evidence on areas, which would be difficult to
identify otherwise. Within the constructs of each variable, specific questions provided
some very specific insights about good governance aspects through the e-procurement.
Results indicate that role of e-procurement in enhancing good governance in the
public procurement sector was positively significant.

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A more detailed discussion of these insights, along with possible ramifications,


conclusions, limitations of the study, and opportunities for further research, is provided in
Chapter 5.

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CHAPTER 5. DISCUSSION, IMPLICATIONS, AND RECOMMENDATIONS


This action research was focused on assessing the role of e-government
procurement (e-GP), or e-procurement, system in enhancing good governance in public
procurement sector. Specifically, the research explored user and stakeholder attitudes,
perceptions, and knowledge of key points in the e-procurement process in the country. It
has been seen that good governance has become a major concern of governments with a
focus on efficiency and value-for-money in expenditure in public procurements as well as
support for the sustainable socioeconomic development of any country. This research
supports the main premise that e-GP system does significantly support an enhancement of
good governance in public procurement.
The research was designed to discover how e-GP system users perceived and
defined the limitations of this support for the improvement of good governance.
Outcome recommendations have been developed that have already begun to
contribute in the behavior and attitudes of public organizations and other stakeholders.
This practical impact on the e-procurement system has occurred as a part of a
collaborative process with the researcher and the intended users as they work within
focus groups to evaluate the programs resources, gather data, evaluate findings, and
execute the recommendations (Patton, 2012a, p. 154). The outcomes summarized in
Chapter 4 enabled the public procurement regulatory and monitoring agency and other

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intended users to improve the implementation and use of e-procurement system by


designing an intervention to create change (Patton, 2012a, p. 57).
The outcomes of the study are expected to impact perspectives and use patterns in
e-GP implementation by governments around the world as the research findings highlight
and inform the importance of focusing on good governance as a goal, rather than
minimally focusing on transparency, or efficiency, or saving costs. The findings of the
evaluation allow the public procurement regulatory and monitoring agency to calibrate
the existing approach to enhance good governance and simultaneously provide a
comprehensive e-GP implementation framework for all countries beginning to implement
e-GP systems.
Revisiting the Problem
Presently, most of the governments around the world implement the eprocurement systems as a tool for public procurement reform, but have a negligible
impact on significant change. Many countries are focusing merely on cost savings in the
use of e-procurement, or other benefits.
This action research analyzed the implementation of the e-procurement system in
the host country of this research in terms of its utility addressing different dimensions of
good governance by measuring the users perceptions about the role of the e-procurement
in public procurement good governance, and their attitudes towards its use. With this
approach, the research unveiled incomplete knowledge and practice of the underlying
attitudes, perceptions, and knowledge of significant roles of the e-procurement system
that could change and impact good governance.
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Discussion of Findings, Implications, and Recommendations


Compilation of feedback and recommendations as an outcome of this action
research is attached in Appendix D and a set of functions and facilities recommended to
enhance good governance is provided in Appendix A. Findings, implications, and
recommendations for each of the constructs of good governances are discussed here in
details.
Transparency
The survey analysis rejected the null hypothesis that the e-procurement system
does not significantly contribute to enhance transparency of procurement processes and
information in public procurement. A further analysis into each question of the construct
for transparency revealed a very strong consensus about the significance of eprocurement system contributing to good governance.
The e-procurement system publishes invitations to bid and procurement award
information but lacks few of the following important features, procedures, knowledge,
and transaction-related practices:

Inadequate traceability of transactionRespondents recognized that the


existing e-procurement system does not provide adequate traceability of the
procurement processes. In absence of traceability, the process and outcome of
the process will not be transparent, and raises questions on fair treatment. The
processes of the transactions should be made transparent to the bidders as well
as other users of the system.

No mandatory requirement to ensure availability of budgetThe eprocurement system lacks the verification instrument to ensure the availability
of budget before publishing invitation to bid. It points to the fact that the
planning process is weak, and challenges the effective execution of the
contracts. Any procurements should be planned upfront with adequate budget
assurance from the Ministry of Finance. Automated verification with the
financial management system in Ministry of Finance will address this
problem.
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Absence of debriefing functionThe e-procurement system does not provide


debriefing of the reasons of the specific bidder not being selected for the
contract. However, the bidders are notified about the winner of the contract
through a manual communication. Debriefings should be provided to the
bidders upon their request within stipulated time after the notice of contract
awards.

Absence of e-procurement guidelinesFor the users of e-procurement


system, it is not transparent how the whole e-procurement system works.
Users lack adequate knowledge about how they are protected, and what are
the consequences. The implication is that e-procurement system is running
without a clear knowledge of legal and operational authenticity of e-GP, its
underlying electronic processes and incorporated operational practices
different from the traditional procurement approach, authenticity of the
transactions done through e-GP by its users, ownership of data and content
stored in the e-GP system, security and institutional arrangements for its
governance, and roles, responsibility, and obligations of the users. The eprocurement is allowed by the Public Procurement Regulations, and datasecurity-related issues are addressed separately by the Electronic Transactions
Act of the country, but a preparation of a comprehensive e-procurement
directive will provide the clear operational governance framework of the eprocurement system. The e-GP guidelines is urgent in the context in which
few agencies are carrying out their procurements through e-procurement
system, and many public entities are still following the traditional paper-based
procurement system.

Trend of bidding lowAn interesting phenomenon of low bidding was


revealed in case of majority of bidding processes after the implementation of
the e-procurement system in the country. In few cases the bids received were
more than 50% less than the estimated price. Looking at this phenomenon
only from the perspective of cost savings, it appears good. However, the
respondents indicated that the phenomenon seems to be engendered because
of perceived online competition. Another reason could be the reduced face-toface contacts of the bidders with the public entity employees. The implication
of this phenomenon is huge, which affects the socioeconomic development
objective of the country. Low bidding raised a few challenges, such as (a)
Contractors compromise on quality; (b) Contractors quit contract during its
execution; (c) Contract remains incomplete; and (d) There is an increase in
contract variations in terms of contract scope and cost. To resolve these
challenges, a few options can be recommended: (a) Prepare price reference of
the common procurement items by the public procurement regulatory and
monitoring agency, and publish the updated reference price in the eprocurement system for the use by the public procuring entities and bidders. It
will ensure the minimum quality standard, and also controls the price
variations; (b) Disclose the estimated price of the procurement package in the
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annual procurement plan; (c) Add function to controls bid price at the time of
bid submission, if the bid is substantially low. Permissible minimum offer can
be set in the system, but for this regulatory and monitoring agency should
work out on the reliable price reference to be used for preparing the estimate
of the procurements; (d) Increase the weight substantially in quality criteria,
giving less weight to price in evaluating the bids; and (e) Introduce supplier
appraisal and make it public. This approach makes bidders more responsible
to their bids, and contract execution.

Requires more stakeholder engagementThe survey and focus group


discussions revealed that the respondents feel lacking of more stakeholder
engagements. It shows that there is no platform online or offline to share the
knowledge, clarify the issues, provide opinion, and there is no appropriate
channel to contribute on the policy and strategy formulation on procurementrelated issues. Based on the aspirations of the respondents of the research, it is
recommended to make the e-procurement system social medial enabled by
making available online discussion forums, introducing mobile Short Message
Service alerts on procurement opportunities and other important events, and
increase stakeholders engagements through the social media enablement (i.e.,
Facebook, Twitter, etc.) of the e-procurement portal by publishing bid
opportunities, information on public procurement and encouraging open
interaction on the public-procurement-related issues.

The public procurement regulatory and monitoring agency should review the
feedback and recommendations provided by the respondents through survey results and
focus group discussions as well as considering the international best practices in eprocurement implementation, and implement in its subsequent updates and releases of the
e-procurement system implementation.
Although the stakeholder respondents fully agreed that the e-procurement system
has significantly enhanced the transparency in public procurement, further research and
policy level decisions are needed while incorporating and implementing these feedback
and recommendations. The public procurement regulatory and monitoring agency is
recommended to work with the e-procurement policy and implementation experts with
the engagement of all key stakeholders.
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Accountability
The survey analysis rejected the null hypothesis that the e-procurement system
does not significantly contribute to enhance accountability of the actions in public
procurement. A further analysis into each question of the construct for accountability
revealed a very strong consensus about the significance of e-procurement system
contributing to good governance.
Although the null hypothesis on accountability was rejected and it was assumed
that there were perception, knowledge and adequate attitude towards the fundamental
requirements of the good governance in terms of accountability, examination into the
individual questions in this construct revealed that, in many cases, this knowledge was
incorrect and inadequate. Some of those gaps and challenges identified through the
research are discussed as follows:

Absence of code of conductIt was found that the e-procurement system


does not bind the public officers, bidders, and other users by any kind of code
of conduct, terms of use, or confidentiality and nondisclosure declarations. In
many cases, surprisingly the perception on accountability revolved only
around the public officers, whereas the same level of accountability is
expected from all the actors (i.e., public officers, regulatory/oversight
agencies, bidders and civil society) involved in the procurement process and
outside for good governance in the public procurement sector.
As discussed in case of transparency, traceability was not possible in the
e-procurement system. Although code of conduct is also not enforced, it is
difficult to track the accountability of the actors in the process outside the eprocurement system. The accountability measures should be enforced both for
the e-procurement system and outside the system. This kind of agreement to
the code of conduct for the actors of procurement process in the eprocurement system also helps to maintain the confidentiality of the content
and protects entities from the challenges of untimely disclosure of incomplete
and unauthorized information.

Diluted accountabilityA shocking practice of sharing user ID and password


by the authorized officers to the lower level staff or information technology
operators to carry out transactions on their behalf, was revealed during the
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focus group discussions, which puts the accountability aspect challenged if the
challenge is not addressed. The challenge engendered by different factors: (a)
The authorized officer is not confident using e-procurement system due to the
lack of computer skills; (b) The administrative process is based on commandcontrol model, in which the high-level officers do not execute themselves but
give instructions to the lower level staffs; (c) The management of public
procuring entities perceive that the use e-procurement is the function of
information technology professionals and not the mainstream function of
procurement management; and (d) The change management process and
business process reengineering were not at all carried out or not adequately
carried out.
It is recommended that a comprehensive change management plan with
clear objectives, target group, activities and messages to be conveyed should
be prepared, and capacitate the users in the new environment updating their
perception, knowledge, attitude, and leveraging the potential of e-procurement
in a real sense.

Use of personal e-mails in official transactionsAnother malpractice was


revealed that the users using their personal e-mail accounts, obtained from
free online e-mail services (i.e., e-mail accounts from Gmail, Yahoo,
Microsoft, and other known and unknown service providers) in procurement
transactions and communications in e-procurement system. The eprocurement system sends automated e-mails and transaction-related
information to the e-mail account submitted at the time of their registration.
The implication of this practices results into the loss of procurement
communications, and leakage of confidential procurement information from
these account. When employees are transferred to another organization or
discontinue their employment, or have bad relationships with the authority of
the organization, the information and communication carried out through the
use of personal e-mails are lost and knowledge and accountability not retained
in the organization. It is not traceable. The public procurement regulatory and
monitoring agency is highly recommended to enforce an e-mail policy of
using only an official e-mail account either organization domain name based
e-mail account issued by the corresponding organization or, the account
issued by the government for its employees, or the e-mail account offered by
the e-procurement system. This will help to recover the information, and also
reuse the same e-mail account by new employee just changing user password.

Inadequate authority to procurement officersOne of the reasons of


ignorance in accountability was revealed as the inadequate authority given to
the public procurement officers for making decisions on varied and complex
procurements. The implication of this challenge is the lengthened procurement
cycle, misprocurement, misappropriation of the authority to execute contract,
and capacity to manage the contracts. Public officers could be made more
accountable only by giving appropriate and adequate authority, defining
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timeline for actions, thresholds of their authority, rewards for


accomplishments and punishment or room for improvement, which could be
built in to the e-procurement system. A basic workflow process is there in the
e-procurement system, but it should be linked with the threshold given for the
approving authority, and linked with given mandates or roles.

Contract management moduleCurrently, there is no contract management


module in the e-procurement system, which leaves out the vast scope of
accountability in terms of delivery of the contracts. All responsible actors
should be accountable for ensuring the quality of deliveries within the agreed
time and cost with the highest level of ethical behavior and attitude in
executing the contracts. For this, a comprehensive contract management
module with the functionalities and tools to track deliveries, milestones,
payments, quality assessment, and appraisal of suppliers and contractors
should be incorporated in the e-procurement system.

It appeared that many of the attributes associated with accountability were


attributed to public procurement entities and officers. What was surprising to the
researcher was that these perceptions were held across the spectrum of all three groups of
users who responded and participated to this survey. This lack of understanding about the
nature and role of accountability, especially the role played by accountable and decision
making authorities, may well have negative implications in shaping the perception,
knowledge, behavior and attitude of the entire organization (either it is public
procurement entity, or bidding firm, or regulatory/oversight agency) in e-procurement
environment with operational goals of the agencies. Further research should ascertain
whether the observed perceptions and attitudes of the respondents and participants were
actually based on their experience or are due to a lack of clear understanding about
accountability or a result of the transitional change process into an electronic
environment.
Although the respondents and participants indicated that they fully agreed the eprocurement system has significantly enhanced the accountability in public procurement,
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and they recognize important attributes of accountability, the perception, knowledge and
attitude towards the scope and spread of the accountability was somehow incomplete, so
further research is necessary to strengthen the nature and role of actors in the
accountability process.
Corruption Control
The survey analysis rejected the null hypothesis that the e-procurement system
does not significantly contribute to enhance corruption control of the actions in public
procurement. A further analysis into each question of the construct for corruption control
revealed a very strong affirmation about the significance of e-procurement system
contributing to good governance.
Although the null hypothesis on corruption control was rejected, and it was
assumed that there were perception, knowledge and adequate attitude towards the
fundamental requirements of the good governance in terms of corruption control,
examination into the individual questions in this construct and focus group discussions
revealed that, in many cases, the corrupt attitude was still rampant, and there are many
areas in which the e-procurement system should be upgraded incorporating measures for
corruption control. Some of the key findings and their implications and recommendations
are discussed as follows:

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Psychological impact on corruption controlAccording to the experience of


the respondents and participants, corruption usually happening before contract
awards have been significantly reduced. All of the participants agree that a
regular phenomenon of clash among the bidders on the last day of bid
submission preventing each other from dropping bid documents is completely
stopped because of the e-procurement. The impact was the result of the online
availability of bidding documents, and online submission of the bids, but in
many cases corruption from the time of bid security submission and contract
signing to contract completion are still not controlled. Anonymity of bidders
before bid submission has affected psychologically to the bidders, so the
coercive practices at that stage are completely stopped.

Many key processes are not automatedFace-to-face interactions of bidders


with the public officers, one of the fundamental sources of corruption, are still
not fully stopped. To cite few of the examples, (a) Bidders are still required to
submit original paper copy of bid securities to public procuring entities,
whereas they submit their bids online; (b) In many cases, public procuring
entities are still asking to submit a paper version as well even after submitting
bids online; and (c) At the time of prebid opening, bidders are still invited to
be present at the public procuring entity. In the matured e-procurement
systems in other countries, online interactive question-and-answer sessions,
and subsequent sharing of clarifications to queries on bidding documents
already replace prebid meetings. In most of the matured e-procurement
systems, bid openings are done by the e-procurement system, and the bid
opening records are automatically shared with the participating bidders. It is
evident that business process reengineering at the planning and design phase
of the e-procurement system was not adequate. Many of those paper-based
processes and practices could have been eliminated by other online options to
avoid face-to-face interactions. The implication is that the bidders anonymity
are disclosed, and the users from both the sides are still obliged to use manual
as well as electronic processes. It does not really address the key requirements
of corruption control. It is recommended to implement alternative options for
avoiding face-to-face interactions. Direct interface with the banking network
or providing access of securities handling module of e-procurement system to
the commercial banks for bid-securities-related transactions could be an
effective option.

Major corruption in contract executionThe respondents and participants


indicated that easy corruption is happening at the time of contract execution.
There is no control and effective monitoring of the contract execution in the
field. Participants, especially the bidders indicated that giving a certain
percentage of contract payments as commission to the client is already
established as a legal system in the civil works contracts. Major corruption is
practiced also under the cover of scope change and contract variations. The eprocurement system can provide greater control by developing a
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comprehensive e-contract management system, linking with the deliverables,


quality control, payments and expenditure tracking mechanisms.

Access to audit trails of procurement transactionsOversight agencies do not


have access to the audit trails of the transactions in the e-procurement system.
Controlled access to such audit trails and other information strengthens the
forensic investigations in case of any suspected fraud or corruption cases in
public procurement.

The positive side of the e-procurement system is that it has enhanced the internal
control of the activities of the procuring entities in some degree by automatically
recording all the activities of the users carried out through the e-procurement system.
Although the respondents and participants indicated that they fully agree the eprocurement system has significantly enhanced the corruption control in public
procurement, and they recognize that corruption is happening beyond the e-procurement
system as the system does not have control over the activities outside. Ethical aspects of
the procurement process can only be addressed through self-declaration by both the
public officers and bidders of their noninvolvement in any kind of fraud and corruptive
activities in and outside the e-procurement system. Innovative ways of developing
functions for corruption control could be explored and incorporated in the future versions
of the e-procurement system.
Efficiency, Effectiveness, and Predictability
The survey analysis rejected the null hypothesis that the e-procurement system
does not significantly contribute to enhance efficiency, effectiveness, and predictability
of procurement processes and information in public procurement. A further analysis into
each question of the construct for efficiency, effectiveness, and predictability revealed a

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very strong consensus about the significance of e-procurement system contributing to


good governance.
The null hypothesis for the Efficiency, Effectiveness, and Predictability variable
was rejected. It appeared that there were extremely positive responses towards this
construct of good governance. Perception of all the three groups confirmed that the eprocurement was contributing to enhance the efficiency, effectiveness, and predictability
in public procurement. However, an investigation into the questions, knowledge on
measures required in e-procurement system for enhancing efficiency, effectiveness, and
predictability aspects, and the attitude of the users revealed that the perception,
knowledge, and attitude were less than comprehensive. Some of the findings and their
implications and recommendations are discussed as follows:

Phasing approach of e-GP implementationThe research reveals a significant


flaw on the theory of phasing of e-procurement system implementation. The
phasing of the system implementation was significantly fragmented. It started
with the phasing of annual procurement plan preparation to e-bid submission,
and second phase was planned to have bid opening, evaluation, contract
awards, and contract management with payment functions. The first phase
itself suffered from many gaps between dots. Many of the subprocesses of
procurement process those included in the first phase had to be handled
manually. That made the online processes also significantly inefficient. It
appeared from the research that the phased approach of implementation eprocurement system without having implemented complete set of key
processes is not always favorable for achieving desired target. If phase
implementation is planned, the phase should be designed in such a way that it
demonstrates the effectiveness of implementation and integrity of the process
of procurements are maintained, not that it is phased to see if the system
works or not, or functions implemented are complete or not. Purpose of the
implementation should be clear at the design phase. Phasing is not effective if
something is done electronically and other functions of the process are done in
manual system. In absence of fit-for-purpose planning in phasing, actual
benefit cannot be achieved.

Absence of evaluation and contract management moduleBecause the eprocurement system still did not have evaluation and contract management
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modules, as well as limited functionalities in workflow, efficiency,


effectiveness, and predictability were not achieved in true sense. However,
even with the limited facilities in the e-procurement system, the level of
satisfaction received by the users on these aspects gives incentives to the
stakeholders to further enhance the e-procurement system to achieve more. A
well structured evaluation module for works, goods, and services contracts
reduces the discretionary decisions on contract awards, standardizes the
evaluation process, provides a level of predictability on the results to the
bidders, and builds trust on e-procurement system.

Lack of performance measurement and monitoring toolThe current version


of the e-procurement system provides limited compliance validation to the
Public Procurement Act and Public Procurement Regulations but it does not
provide any indicators for the performance measurements. However, the
system provides few standard reports.

A standard bidding document template, annual procurement plan, and


workflows are key. Availability of few standard bidding document templates,
annual procurement plan and workflow have significantly enhanced
efficiency, effectiveness, and predictability. If the workflow feature is linked
with the roles and thresholds of authority for administrative and financial
approvals, the system will be more effective.

Lack of system knowledgeSome of the features are still not used because of
lack of knowledge. One of such good features available is the facility for the
public procuring entities to prepare the bidding document using the already
used bidding documents, which could minimize the time for bidding
document preparation. Another feature is that the procuring entities can
prepare the bidding documents and schedule date for publishing invitation to
bids, not requiring to wait till the scheduled time in the annual procurement
plan to prepare the different sections of the bidding document (i.e.,
specifications, evaluation criteria, other supplementary details).

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Training requirementEfficiency and effectiveness if in some way related to


skills and capacity of its users. Because the e-procurement is new to the
bureaucracy in the procurement sector, it requires extensive training on using
the e-procurement system.
It could be that this lack of trainings on the details of the e-procurement
system has permitted many misperceptions about efficiency, effectiveness,
and predictability in the use of e-GP system. This seems to be an area that
would benefit from follow-on research to determine if a link exists between
the lack of training on the details of e-procurement system features and the
somewhat limited knowledge displayed about aspects of good governance.
However, based on the evidence revealed by this research, this seems to be a
plausible reason.

Easy Access to Procurement Information and instruments


The null hypothesis for the Easy Access variable was also rejected that the eprocurement system does not significantly contribute to enhance easy access to
procurement information, processes and instruments in public procurement. A further
analysis into each question of the construct for easy access revealed a very strong
consensus about the significance of e-procurement system contributing to good
governance.
Despite the null hypothesis for the Easy Access variable was rejected, the survey
respondents pointed out there were several barriers to e-procurement system
implementations. Although the respondents felt that e-procurement system
implementation was important for the country, they identified several obstacles that they
felt were preventing smooth implementation. Listed as follows are some of the findings,
implications, and recommendations:

Adequate Internet speedSpeed of the Internet is one of such key obstacles.


Although 85% of geographical areas of the host country of this research,
including remote parts of the country, have access to Internet and 3G
networks, consistency of connection and speed are challenging. The
participants mentioned that the cost of the Internet is getting cheaper.
Implication of the slow Internet speed may sometime creates problems of
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incomplete bid submission or worse is when bid submission deadline is


crossed. Most of the small bidders go to cyber-cafes to submit bids and even
sometimes receive help from the public procuring entity to upload the bids.
The later practice taking help of public procuring entity employees to submit
bids conflicts with all principles of procurement creating conflict of interest.
The observed practices in some cases, providing support to bidders on the bid
preparation and submission by public entities should be stopped. To tackle the
issue of Internet, it is recommended to develop an offline tool to prepare the
bidding documents and bids without requiring Internet, and allow upload or
submission when Internet is available. The regulatory/oversight agency,
accepted that the Internet bandwidth in the data center at the Government
Integrated Data Center was also as low as 5 mbps, and it is being upgraded in
Phase II to 15 mbps along with the additional server and network equipment
for failover arrangements.

Access to bidding documentsThe e-procurement system has taken a policy


to provide free access to the bidding documents before submitting bids, which
provides the bidders to access their own capacity, resources, confirm the
eligibility and qualifying criteria, and other compliance requirements before
investing time and resources in preparation of bids.

Easy planningThe respondents and participants highly praised the policy to


publish an annual procurement plan, which again helps both the bidders and
public procuring entities to plan their resources upfront. Disclosure of
estimated cost of the procurement and government reference price on common
procurement items would help better planning for both the bidders and public
entities.

Lack of knowledge on complaint handlingIt was revealed that the


knowledge of bidders on their rights to make complaints on the procurement
process and decisions was very weak. The e-procurement system does not
provide any information on this knowledge and also there is no e-procurement
provision to facilitate the rights of the bidders for lodging complaints.
Complaint submission functions should be available for the bidders and
should be easy to use.

Rule of Law and Promote Equal Treatment to the Bidders


The null hypothesis for the Rule of Law and Equity variable was also rejected that
the e-procurement system does not significantly contribute to enhance rule of law and
equity in public procurement sector. A further analysis into each question of the construct

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Rule of Law and Equity revealed a very strong consensus about the significance of eprocurement system contributing to good governance.
It was observed that the respondents and participants perceived the most
significant role of e-GP was to ensure the rule of law and promote the equal treatment to
the bidders. Some of the findings, implications, and recommendations are discussed as
follows:

Issue of small biddersSome of the participants from the bidder community


expressed that there may be an unequal treatment to the small bidders, who do
not have adequate access to information and communications technologies.
However, not all bidders believe the same. There is a strong theory from
bidders as well as other focus groups that even the small bidders can quickly
make themselves ready in information and communications technologies if
the bidders get an opportunity to bid on the government procurements and
treat them equally with the other bidders.

E-GP guidelines for enforcing rule of lawIn absence of the e-GP guidelines,
there are numerous ambiguities in case of enforcing the procurement acts and
regulations in case of e-procurement system. The process and practices in the
manual and electronic environments differ a lot, and those differences should
be clearly communicated to the stakeholders.

Mass communication campaign for bidders registrationBidders registration


and its adoption seems a bit slow. A critical mass of bidders should be
registered in the system, so that a real competition can be achieved. If the
number of bidders is not significant in the e-procurement system, it will have
negative consequences in terms of equal treatment to the bidding community.
It was also revealed that because of the limited number of bidders
participating in the e-procurement system, award of the contracts sometimes
appeared to be rotating only among a known group of contractors. The
attitude of the bidders observed in this case is not favorable for the eprocurement system in the long run, however it provides incentive to the
bidders at the initial period. A divide in the bidding community with access to
e-procurement system and without will imbalance the procurement sector. It is
recommended to start a campaign for the registration in the e-procurement
system, and also mobilize the professional membership associations of
suppliers and contractors to encourage and instill the knowledge about the eprocurement system. Only a critical mass of bidders registered in the eprocurement system, and competing in the procurements may bring value-formoney as well as promote the principle of equity in the procurements. In
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absence of adequate number of bidders in the e-procurement system, it will


only institutionalize the organized syndication, cartel, and other malpractices.

Automatic compliance to the procurement rulesOnly a limited rules are


configured in the e-procurement system. Configuration of e-procurement
processes based on the prevalent acts, regulations. and procurement rules
facilitates the compliance of the procurement activities significantly. The eprocurement system helps to enforce the micromanagement steps throughout
the procurement process. It is recommended a dedicated commitment to the
enforcement of procurement rules by the regulatory/oversight agencies, and eGP facilitates to enforce that. Compliance to the Public Procurement Acts and
Regulations provides a legal basis for procurement contracts.

Complaint handlingThe e-procurement system does not provide function of


complaint handling. Also, the role of the Procurement Review Board is not
incorporated. The whole process of complaint submission and processing is
done in manual environment. It discourages the bidders to submit the
complaints even many genuine cases. It is recommended to incorporate the
function for the Procurement Review Board and also provide easy access to
such function to the bidders from their private dashboard.

Civil Society Awareness


The null hypothesis for the Civil Society Awareness variable was also rejected
that the e-procurement system does not significantly contribute to enhance civil society
awareness in public procurement sector. A further analysis into each question of the
construct for civil society awareness revealed a very strong consensus about the
significance of e-procurement system contributing to good governance.
First, the respondents, especially the oversight agencies mentioned that the tools
required for the civil society awareness is not adequate in the current version of the eprocurement system, which cannot foster an environment that was conducive to engage
general public and civil societies as watchdog in the public procurements carried out
through the e-procurement system. Some of the findings, implications, and
recommendations are discussed as follows:
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Absence of citizen engagementThere was a strong urge from the bidding


community to start an online public discussion forum for the discussions on
the procurement-related issues and sharing knowledge among the
stakeholders. Currently, there is no platform for expressing opinion about the
procurement-related issues, and share the practices. If online discussion forum
is started, it will also help shaping future policy and strategies for the
enhancement of e-procurement system and procurement sector as a whole by
informed and participative support from the stakeholders.

Absence of procurement statisticsThere is lack of public procurement


performance statistic and analysis of the past procurements, which could be
used as feedback for the future procurements. Currently, it is very difficult to
find real statistics on the public procurement. General public, the taxpayers
are not aware about the expenses of public fund. National plans on
socioeconomic development and strategic procurements are made without
reliable statistics of data, and hence the national level strategy and objectives
do not align with the procurements made by the public entities. It is
recommended that e-procurement system collect, analyze, and disseminate
such analytical statistics and provides feedback to the national development
strategy.

Establishment of helpdeskIt is felt a requirement of setting up a helpdesk,


which can bridge the civil society with the procurement sector. Currently, it
still does not provide the helpdesk to ask questions in relation to
procurements.

Open data and open contractingThe country has started recently an


initiative on open contracts through a support from the World Bank. It has
opened up avenues for the disclosure of procurement- and contract-related
public information, and makes the civil society aware about the public
procurements and contracts, however there are no clear government policies
towards open data and open contracting practices to date. It is recommended
to join the global initiative on open data and open contracting to enhance
transparency and accountability with information dissemination to the general
public.

Despite a lack of many options for engaging civil society in public procurement,
the respondents and participants appreciated the existing level of information disclosure,
which were not at all accessible in traditional method of procurements.

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The research concludes that the awareness about the public procurement in
general public has been significantly improved, because of the increased transparency
measures provisioned in the e-procurement system.
Implementation and Incorporation of Action Research Outcomes
The advantage of action research following utilization-focused evaluation is the
realization of outcomes into real-life actions during the evaluation process (Patton,
2012a). The outcome of the project and the utilization-focused evaluations enabled the
public procurement regulatory and monitoring agency and other intended users to
improve the implementation and use of e-procurement system by designing an
intervention to create change (Patton, 2012a, p. 57). According to Ramirez and
Broadhead (2013), [utilization-focused evaluation] evaluators facilitate a learning
process with attention to how real people in the real world might apply evaluation
findings and experiences. In designing a utilization-focused evaluation, the attention is
constantly on the intended use by intended users (p. 1). As the action is the only way to
generate and test new social science knowledge, the evaluation findings in participation
of intended users were prepared as the classified recommendations for use. The public
procurement regulatory and monitoring agency has prioritized the research evaluation
recommendations under Strategic and Operational categories, so that the use of findings
becomes more manageable. Most of the recommendations have been implemented in the
rollout version of the second phase of e-procurement implementations in the country. The
following recommendations have already been incorporated or are in the process of being
incorporated in the second phase of the e-procurement system:
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The agency has already initiated a process to amend the Public Procurement
Regulations to allow only electronic submission of bids in case of
procurements through the e-procurement system. It will stop the
inconsistencies seen because of online- and paper-based hardcopy parallel bid
submission on the first phase of the e-procurement system implementation.

E-mail notifications to bidders notifying important events, including user


registration, new invitation to bid publication, and notice of contract awards.

Enhanced functionalities to reuse documents from the already completed


similar procurements.

Availability of functionalities to submit bids in part, and allow the bidders to


modify and update the bids until final submission.

Availability of bid opening, sharing of bid opening records with participating


bidders, and evaluation modules.

Availability of contract award notice, and debriefing on request, and


publication of details on the awarded contracts.

Availability of comprehensive contract management module with functions to


track deliverables, milestones, quality assurance assessments, e-invoicing, and
payments.

Available solution for collecting payments for the bidding document purchase,
issuance and management of bid securities and guarantees through banking
channel.

Inclusion of e-catalog with classification of goods, works, and services using


one of the popular international standard for classification common
procurement vocabulary.

Standardization of bill of quantity formats for goods works and services.

Introduction of more standard bidding document templates for works, goods,


and services.

Initiation to develop e-GP guidelines.

Initiation for business process reengineering on the regulatory and monitoring


agency, and Procurement Review Board processes on complaint handling and
administrative review.

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Encryption of all transactional and other confidential data in database.

Publication of debarment list of bidders.

Mandatory requirement to publish annual procurement plan and ensuring


budget for the procurement, and other functions.

These are the examples of how the action research recommendations contributed
to change in the behavior and attitudes of the public organizations and stakeholders at the
practical level as well, through a collaborative process with the researcher and the
intended users as they work within focus groups to evaluate the programs resources,
gather data, evaluate findings, and execute the recommendations (Patton, 2012a, p. 154).
Conclusions
This research was intended to assess perception, attitude, and knowledge of the eGP users on the role of the e-procurement system in enhancing different dimensions of
good governance in the public procurement sector as well as the adequacy of measures
taken in the design and implementation of the e-GP system based on the best practices in
different countries. This action research appears to show that public procurement sector
stakeholders do consider e-GP plays very significant role in enhancing good governance
in the public procurement sector. The outcome of the study reveals a change in behavior
and attitude towards the e-GP system implementation by addressing gaps in different
aspects of governance e-GP implementation to meet the fundamental requirements of
good governance. Their research evaluation reveals that the e-procurement system can
enable good governance. In addition to the perception assessment, the action research
questions in this research were intended to assess the opinion of the participants

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regarding the adequacy of measures taken in the design and implementation of e-GP
systems based on the best practices in different countries.
The findings of the evaluation provided input for the public procurement
regulatory and monitoring agency to allow calibrating the existing approach of
implementing e-GP system as well as provide a comprehensive e-GP system
implementation framework for the countries in the process of implementing e-GP
systems for enhancing good governance in public procurement.
The bidding community appreciates e-procurement when it reduces complex data
entry procedure, validates the data as it is entered by improving data quality, standardizes
and streamlines their work, makes the procurement processes transparent, treats equally
to all bidders, and provides provision of debriefing the reason of failure to win the
contracts, and the access to e-procurement system is hassle free. This action research also
revealed that there is considerable need to communicate the utilization of e-GP system to
enhance the good governance in public procurement to the stakeholders. As indicated by
the United Nations Educational, Scientific and Cultural Organization (2005), the eawareness amongst the government employees and their willingness to embrace change
shall play a key role in the whole process.
However, an evaluation of specific questions asked in the areas of transparency,
accountability, corruption control, efficiency, effectiveness, and predictability, easy
access, rule of law and equity, and civil society awareness led to the conclusion that there
are already many necessary aspects for good governance in public procurement sector
exist and can be incorporated within the e-procurement system. When viewed from the
experience from many other countries for the introduction of e-procurement systems, the
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system implemented in the first phase in the country is still at an immature level and
inconsistently implemented, but provides important lessons to the world.
Nevertheless, based on responses about the role of e-procurement system in
enhancing different seven aspects of the good governance, further research may show
that functions, tools, processes and practices in terms of aspects of good governance
could well be improved. It is also obvious that the resultant data on perception, attitude
and knowledge could be different if the e-procurement system implementation is assessed
after few years.
Although there were significant levels of perception, attitude, and knowledge
about role of e-procurement systems to enhance different aspects of good governance,
respondents to the survey questionnaire and participants in the focus group discussions
exhibited some confusion about the specific roles and functions as well as pointed several
deficiencies in the existing version of e-procurement system. More specifically, the
research showed that the strategic nature of good governance is often confused with the
more tactical and operational aspects of e-procurement system management. It was
observed that all key aspects of good governance were not taken as a strategic-level
agenda for the public procurement through the e-procurement system, yet these aspects
orchestrated together only may impact as the key tenets of good governance in public
procurement sector.
It was quite intentional that questions about all aspects of good governance were
asked in the same questionnaire. Although detailed correlation of the variables is beyond
the scope of this current research, it appears that for the user of the e-GP system, there is

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a real lack of opportunities for hands-on training, and awareness campaigns about the
aspects of good governance in the e-procurement system.
At the very least, it would appear that the stakeholders are optimistic about the
achievements so far from the e-procurement system, and look forward to its
improvements in the implementation of the next phase.
The research showed that there appeared to be several obstacles to implementing
e-procurement system. Again, a synthesis of several of these obstacles indicates that the
stakeholders appear to have much more of a tactical than a strategic focus. Despite many
scholar literatures recommend phased implementation of e-GP implementation as one of
the essential requirement for the success of e-GP system, it appeared from the research
that the phased approach of implementation e-procurement system without having
implemented complete set of key processes is not always favorable for achieving desired
target. If phase implementation is planned, the phase should be designed in such a way
that it demonstrates the effectiveness of implementation and integrity of the process of
procurements are maintained, not that it is phased to see if the system works or not, or
functions implemented are complete or not. Purpose of the implementation should be
clear at the design phase. Phasing is not effective if something is done electronically and
other functions of the process are done in manual system. In absence of fit-for-purpose
planning in phasing, actual benefit could not be achieved. One of the major challenges in
leveraging full potential of e-procurement system in the country is its continuity of
options accepting parallel submission of bids both in hardcopy as well as through eprocurement system for the same tender. Another challenge is the continuity of
requirements to submit hardcopy original bid security and other documents, which brings
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bidders and procuring entities face-to-face, opening doors for potential corruption.
Another challenge is that the many procurement processes are still manual, which does
not really reduce the administrative efforts, but adds additional burden to procuring
entities.
This research asserts that the implementation of e-GP system significantly
enhance the good governance in public procurement sector, however it suggests that a
comprehensive and practical e-GP implementation framework is absent in the body of
knowledge on e-procurement. A comprehensive and practical e-GP implementation
framework has been designed and proposed (Appendix E) based on the research, best
practices around the world, and experience of the researcher in assisting governments
around the world in introducing and implementing e-GP systems. It is believed that the eGP implementation framework will provide a practical guidance to the countries
considering implementing e-procurement as a mean for public procurement reforms.
E-procurement implementation should take into consideration of integrated
approach to the good governance. Mere focus on one or two aspects of the good
governance does not bring significant changes in the public procurement sector, there are
always one or another aspects lagging behind and the sector does not achieve desired
objectives. The e-procurement system technology acceptance and adoption theory has
been widely studied in developed countries. However, it has not been studied in the site
country of this research. Thus, this study is unique to the country context. Further, the
study can be served as a starting point for other e-GP or e-procurement adoption
researches in other countries. Moreover, the study provides the public procurement
regulatory and monitoring agency of the country with the type of empirical analysis,
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which is necessary for fostering adoption and usage of e-procurement system to enhance
the good governance in public procurement.
At the beginning of this research, the synthesized definition of e-government
procurement used for this dissertation was that e-procurement is operationally defined as
the collaborative utilization of information and communications technologies (especially
the Internet) by government agencies and other actors in procurement community in
conducting all activities of government procurement process cycle for the acquisition of
goods, works, and services enhancing good governance in public procurement (Shakya,
2012).
An e-GP system is improvised and defined as the collaborative use of information
and communications technologies by government agencies, bidding community,
regulatory, oversight agencies, other supporting service providers, and civil society in
conducting ethical procurement activities of the government procurement process cycle
for the procurement of goods, works and service, and management of contracts ensuring
good governance and value-for-money in public procurement, and contributing to the
socioeconomic development of country.
Limitations of the Study
The scope of the study does not cover the final two steps, 16 and 17, of the
utilization-focused evaluation, although Step 16 was assessed partially to confirm
whether the findings and recommendations of the study has been considered for the
improvement. As Step 16 should cover the follow-up with users to use and Step 17
should reassure the evaluation through the consequent meta-evaluation of the evaluation
itself, substantial interval of time is required to carry out the meaningful accomplishment
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of these steps. Thorough evaluation of Steps 16 and 17 are intentionally left out for the
future study.
Although the overall findings of this research prove the significant role of e-GP in
enhancing good governance in public procurement sector, it has some limitations worth
mentioning. Although the initial target population of the study was intended to be more
bidders, the project running in different places of the country made difficult to get access
to them and getting responses to survey questions from all of the expected bidders.
Although the public procurement regulatory and monitoring agency in the host country of
this research is in preparation of starting the second phase of the e-GP system
implementation, another limitation is that the e-GP system currently running in the
country supports only limited functions of the complete government public procurement
cycle, so the responses to many questions related to the functions beyond bid opening are
fully based on the perception and knowledge of the bidders at the current stage.
Nevertheless, although the researcher believes the perceptions and knowledge of bidders
are sufficient to make this research valid, the absence of few of the functions of
procurement cycle is an acknowledged limitation that might have introduced a bias in the
results. The diverse geographical location of the surveyed public procuring entities may
also limit any wider application of this research.
As pointed out by the participants in this research, a great majority of the
interventions in the implementation of the e-GP system are tactical in nature rather than
strategically focused. Additionally, these public procurement entities face unique
challenges created by easy availability of Internet access and electricity that other
developed countries may not face.
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The method of data collection and the ethical considerations were taken care to
avoid the bias and avoid the limitation of the validity of the results. Additionally,
although this type of research has been done only for the few of the dimensions of the
good governance in public procurement, and never done research on the role of e-GP on
enhancing the comprehensive aspects of the good governance, the research has been able
to ascertain that this has been the first survey ever accomplished assessing the role of the
e-GP system to enhance good governance in the public procurement sector. As such, in
order to ensure that the survey results are externally valid, this survey would have to be
administered even to like populations in other countries.
Recommendations for Further Research
This study sought out preliminary perceptions, attitudes, and knowledge about the
role of e-GP in enhancing good governance in the public procurement sector. It provided
many initial insights about the perceived state of good governance, role of e-GP, and the
e-GP implementation by the users actively working within the public procuring entities,
bidders, and regulatory/oversight agencies, insights, which when augmented by more
detailed research, may provide information that could lead to improvements in e-GP
system implementation in the host country of this research and perhaps in other countries
as well.
Although this information provided clues as to the nature and state of good
governance and role of e-GP in enhancing good governance in public procurement sector,
this research could be enhanced further if the public procurement regulatory and
monitoring agency of the research site country or the specific country government or the
international organizations and development partners like the World Bank, Asian
143

Development Bank, European Union, United Nations, or multilateral development


organizations would consider sponsoring similar research.
This initial research showed that e-GP significantly enhances good governance
providing a wide range of functions to support different aspects of good governance but
that some confusion remained over the nature, scope, and role of e-GP system and
developing sound governance policies to support the sustainability of the e-GP system as
the mainstream procurement platform. This appeared to have its origin in the lack of
training and learning opportunities about e-GP and scope of good governance. If
governments want to positively impact long-term strategic good governance in public
procurement sector through the implementation of e-GP system, they should consider
further research on how best to more formally integrate training and education into every
phase of an employees career, engage citizens in learning process, and provide learning
opportunities to the bidding communities.
Finally, in order to effectively integrate e-GP system for enhancing good
governance into the administrative processes of the whole procurement cycle, further
research should be undertaken in the area of obstacles to implementation and change
management. This exploratory research indicated not only lack of functions and
interventions in implementation but also, more problematically, a lack of any
comprehensive e-GP implementation framework for the countries to follow. A
comprehensive e-GP implementation framework is designed based on the lessons learned
from the e-GP implementation experiences gathered around the world, and proposed as a
guidance to follow for the implementation of e-GP system for good governance in the
public procurement sector, making implementation effective (see Appendix E). The
144

researcher believes that the e-GP implementation framework could prove to be of great
value to enhancing effective implementation of e-GP system to enhance good governance
in a real sense in the public procurement sector.
Summary
In terms of e-procurement implementation, it should take into consideration of
integrated approach to the good governance. Mere focus on one or two aspects of the
good governance does not bring significant changes in the public procurement sector,
there is always areas lagging behind and the sector does not achieve desired objectives.
The e-procurement system technology acceptance and adoption theory has been
widely studied in developed countries. However, and it has not been studied in the host
country of this research. Thus, this study is unique to the country context.
Lack of appropriate government policy on e-Procurement, adequate business
process reengineering of existing procurement processes, scoping of complete e-GP
system, not having comprehensive e-GP guidelines for the smooth implementation of the
e-GP system, fragmented efforts of implementations by individual public entities their
own e-bidding systems, and still having online- and hard-copy-based parallel submission
of bids are challenges in the successful implementation and adaption of e-GP system
enhancing good governance in the public procurement sector.
Further, the study and the proposed e-GP implementation framework can be
served as a starting point for other e-GP or e-procurement adoption researches in other
countries. Moreover, the study provides the public procurement regulatory and
monitoring agency of the research site country with the type of empirical analysis, which
is necessary for fostering adoption and usage of e-procurement system to enhance the
145

good governance in public procurement. Outcome of this research should be used to


further develop and tailor existing capabilities of the e-GP system as well as the
capability of the agency that assist the e-GP users and other stakeholders of the public
procurement sector as they transition from legacy to electronic environment.

146

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157

APPENDIX A. RECOMMENDED E-GOVERNMENT


PROCUREMENT SYSTEM FEATURES
Transparency
Availability of the following facilities (list is based on the international best
practices) on the e-procurement portal are all vital ingredients of transparency in the eprocurement system contributing to enhancing current and future good governance efforts
in public procurement sector:

Public Procurement Act and Public Procurement Regulations as well as other


circulars and directives

Mandatory publication of annual procurement plan by the public procuring


entities

Publication of invitation to bid with eligibility, qualification, evaluation, and


preferential criteria for bidding process, or access to the bidding documents

Ensuring availability of budget for the procurement for public entity

Provide traceability of transactions through audit trails for the benefit of


public entities and regulatory/oversight agencies

Publication of amendment to bidding document

Sharing clarification to queries on bidding document

Sharing bid opening records

Status of the different stages of the procurement process

Publication of report on the best evaluated bidders

Publication of contract award details

Opportunity to request debriefing of the reasons of losing the contract

158

Lodging complaint on the process and practice of procurement and sharing the
review decision on such complaints

Publication of contract implementation progress along with variations and


completion

Online public forum for public discussions on public procurement

Contractor, supplier, and consultant appraisal information

Publication of procurement performance statistics and analytics


Accountability

Availability of the following facilities (list is based on the international best


practices) on the e-procurement portal are all vital ingredients of accountability in the eprocurement system contributing to enhancing current and future good governance efforts
in public procurement sector:

Keeping records of all reviews, decisions, approval and rejection comments at


the stages of public procurement process under the agreed workflow and
based on the roles and authorities of the actors in the process

Keeping records of prequalification and postqualification of bidders,


negotiation with bidders

Publication of contract award notice on time

Ensuring quality of the deliveries before making payments to the contractors

Ensuring the budget for the procurement and payments before publishing
invitation to bids, or before awarding a contract

Details of payment transactions in adherence to the terms of payment agreed


upon in contract

Contract amendments details with reasons

Timely completion of actions and decisions required by the actors in


procurement process
159

Responsiveness of the authorized actors of the process on timely handling


complaints submitted by the bidders, and disputes during contract execution
Corruption Control

Availability of the following facilities (list is based on the international best


practices) on the e-procurement portal are all vital ingredients of corruption control in the
e-procurement system contributing to enhancing current and future good governance
efforts in public procurement sector:

Minimizing face-to-face interaction between public procurement entity users


and bidders

Keeping bidder information anonymous to all users until the bid opening time

Listing of debarred suspended bidders from procurement processes

Disclosure of relationship with the actors involved in the procurement process

Automated control of using discretion and unauthorized judgment by the


authorized users in making decisions

Mandatory binding of the users by a disclosure of their noninvolvement in any


kind of fraudulent and corruption activities

Implementation of e-contract management function

Application of four-eyes principle in all critical decision processes


Efficiency, Effectiveness, and Predictability

Availability of the following facilities (list is based on the international best


practices) on the e-procurement portal are all vital ingredients of efficiency,
effectiveness, and predictability in the e-procurement system contributing to enhancing
current and future good governance efforts in public procurement sector:

160

Most of the compliance to Public Procurement Act, regulations, and


guidelines are automatically validated by the e-procurement system in key
stages of compliance requirements

Procurements are carried out in adherence to the annual procurement plan and
procurements are initiated on time

Standard bidding documents and contract templates are available

Clearly defined roles and authority of the public procurement officers, and
simplified automated administrative workflow available

Business process reengineering carried out and procurement processes and


practices are simplified

Time for getting clarifications on bidding document from public procuring


entity is reduced

Evaluation processes are assisted by semiautomated or fully automated tools


in e-procurement system

Time for evaluation is reduced

If processing time is delayed by any official, system sends timely reminders

Statistics and analytics on public procurement performance of public


procurement entities are generated against the performance indicators, and
provides pointers for improvements

Review and audit of the procurement incidences are easier

Contract processing and decision on awarding time is reduced

Contract management has been easier

Payments to contractors are tracked and paid on timely manner

Contract variation practices have been reduced, and projects are completed on
time, within the budget and with expected quality

Complaints and disputes have been reduced

161

Bidders are provided with procurement information and procurement plans


upfront, and adequately get time to plan, and prepare required resources

Enhanced predictability on decision timings

Ensured value-for-money
Easy Access to Procurement Information and Instruments

Availability of the following facilities (list is based on the international best


practices) on the e-procurement portal are all vital ingredients of easy access to the
Procurement processes, information and instruments in the e-procurement system
contributing to enhancing current and future good governance efforts in public
procurement sector:

Provides easy access to Public Procurement Act, regulations, circulars,


directives, manuals, and e-government procurement guidelines

Browsing speed of the e-procurement system is satisfactory

E-procurement system does not require high Internet bandwidth

High availability of the e-procurement system supported by failover data


center arrangements

Registration of users to use the e-procurement system is instant

Registration of users in the e-procurement system is free of cost or


considerably affordable in comparison to value receivable through the eprocurement system

Provides preview of the bidding document free of cost along with eligibility,
qualification, preferential, and evaluation criteria before buying the document,

Provides features of reusing bidding documents for procuring entities and bid
documents for bidders with minimum changes

Provides easy access to features to lodge complaints on the procurement


process
162

Provides online forms as well as offline provisions for preparing bidding


documents as well as bid offer preparation

Provides easy access to procurement-related documents and decisions for


public procuring entities

Above 70% of the procurement processes of the procurement cycle are


automated
Rule of Law and Equal Treatment to the Bidders

Availability of the following facilities (list is based on the international best


practices) on the e-procurement portal are all vital ingredients of the enforcement of rule
of law and creating environment for the equal treatment to the bidders in the eprocurement system contributing to enhancing current and future good governance efforts
in public procurement sector:

Provides templates of standard bidding documents are reengineered and made


available fully in line with the prevalent Public Procurement Act, Public
Procurement Regulations, guidelines, and other directives

Provides automated compliance verification at each stage of procurement of


required procurement methods, processes, thresholds, rules, number of days
for specific events, and so on, based on the nature of procurement as
provisioned in the act and regulation

Provides administrative workflow based on role and authority of the public


procurement entity officers and other users

Allows submission of bid only if all requested documents are uploaded and
information is provided to make the submitted bid responsive

Provides bidders equal treatment by keeping bidders names and addresses


anonymous in the system until the time of bid opening

Provides access to e-procurement system through different channels of access


such as web browsers and mobile phones

Enhances level of citizen trust in public procurement


163

Civil Society Awareness


Availability of the following facilities (list is based on the international best
practices) on the e-procurement portal are all vital ingredients for the making the civil
society (i.e., general public) aware about the information on the public procurements,
government expenditure on development projects, details on the use of taxpayers money,
and also about the contribution of civil society as a watchdog in public procurement:

Publication of annual procurement plan with details on the procurement being


planned, expected timeline for the start of procurement and completion of the
contract, use of competitive bidding procedures, estimated cost of the
procurement, and so on, in line with the open data guidelines

Publication of invitation to bids with contractor selection criteria

Contract award information in line with the Open Contract Guidelines with
the details on the winning contractor, contract amount, agreed terms with the
contractors, contract execution site information

Publishing the variation of contracts and their reasons

Disclosure of complaints, and their resolutions

Public discussion forum for the discussion on the issues related to


procurements

Publication of statistics and analytics on the public procurement performance


of the procuring entities

Establishment of helpdesk for answering queries from the general public

Provision to provide forensic information in relation to procurements for the


auditing and other oversight agencies for investigation in case of any
suspected fraud and corruption cases.

164

APPENDIX B. VALIDITY AND RELIABILITY ANALYSIS TABLES


Validity and reliability data for good governance factors are summarized in Table
2. The following tables provide validity and reliability data per good governance factor.
The extraction method for all communalities and total variance explained values was
principal component analysis.
Transparency
Table B1. KaiserMeyerOlkin Measure and Bartletts Test Data for Transparency
KaiserMeyerOlkin measure of sampling adequacy
Bartletts test of sphericity

Approx. chi square


df
Sig.

165

.471
595.004
276
.000

Table B2. Communalities for Transparency


Survey Question No.

Initial

Extraction

1.000

.583

1.000

.683

1.000

.763

1.000

.779

1.000

.819

1.000

.780

1.000

.794

1.000

.636

1.000

.668

10

1.000

.814

11

1.000

.764

12

1.000

.717

13

1.000

.769

14

1.000

.783

15

1.000

.658

16

1.000

.639

17

1.000

.823

18

1.000

.580

19

1.000

.714

20

1.000

.843

21

1.000

.728

22

1.000

.842

23

1.000

.728

24

1.000

.708

166

Table B3. Total Variance Explained for Transparency

Survey
Question
No.

Extraction sum
of squared
loadings

Initial eigenvalue
Total

% of var.

Cum %

Total

% of var.

Rotation sum
of squared
loadings
Cum %

Total

4.701

19.587%

19.587%

4.701

19.587%

19.587%

3.536

3.089

12.872%

32.460%

3.089

12.872%

32.460%

2.574

2.880

12.000%

44.459%

2.880

12.000%

44.459%

2.307

1.667

6.945%

51.404%

1.667

6.945%

51.404%

2.142

1.550

6.460%

57.864%

1.550

6.460%

57.864%

1.929

1.414

5.891%

63.755%

1.414

5.891%

63.755%

1.846

1.193

4.972%

68.726%

1.193

4.972%

68.726%

1.677

1.123

4.679%

73.405%

1.123

4.679%

73.405%

1.606

.991

4.130%

77.536%

10

.789

3.285%

80.821%

11

.715

2.978%

83.799%

12

.625

2.603%

86.402%

13

.579

2.413%

88.815%

14

.483

2.014%

90.829%

15

.450

1.874%

92.703%

16

.357

1.489%

94.192%

17

.335

1.396%

95.588%

18

.272

1.133%

96.721%

19

.220

.916%

97.637%

20

.184

.765%

98.402%

21

.147

.614%

99.016%

22

.105

.438%

99.454%

23

.081

.336%

99.790%

.210%

100.000%

24

.050

167

Accountability
Table B4. KaiserMeyerOlkin Measure and Bartletts Test Data for Accountability
KaiserMeyerOlkin measure of sampling adequacy
Bartletts test of sphericity

.819

Approx. chi square


df
Sig.

550.499
105
.000

Table B5. Communalities for Accountability


Survey Question No.

Initial

Extraction

1.000

.701

1.000

.776

1.000

.630

1.000

.601

1.000

.722

1.000

.692

1.000

.719

1.000

.772

1.000

.736

10

1.000

.661

11

1.000

.736

12

1.000

.632

13

1.000

.779

14

1.000

.618

15

1.000

.733

168

Table B6. Total Variance Explained for Accountability


Extraction sum of
squared loadings

Initial eigenvalue
Survey
Question
No.

Rotation sum of
squared loadings

Total

% of
variance

Cumulative
%

Total

% of
variance

Cumulative
%

Total

6.988

46.588%

46.588%

6.988

46.588%

46.588%

5.516

2.305

15.370%

61.957%

2.305

15.370%

61.957%

2.748

1.213

8.088%

70.046%

1.213

8.088%

70.046%

2.242

.904

6.030%

76.076%

.809

5.393%

81.468%

.634

4.227%

85.695%

.492

3.282%

88.978%

.401

2.676%

91.653%

.293

1.952%

93.606%

10

.254

1.694%

95.300%

11

.234

1.560%

96.860%

12

.152

1.013%

97.873%

13

.146

.974%

98.847%

14

.098

.652%

99.499%

15

.075

.501%

100.000%

Corruption Control
Table B7. KaiserMeyerOlkin Measure and Bartletts Test Data for Corruption Control
KaiserMeyerOlkin measure of sampling adequacy
Bartletts test of sphericity

Approx. chi square


df
Sig.

169

.748
90.081
6
.000

Table B8. Communalities for Corruption Control


Survey Question No.

Initial

Extraction

1.000

.429

1.000

.828

1.000

.819

1.000

.555

Table B9. Total Variance Explained for Corruption Control


Survey
Question
No.

Initial eigenvalue
Total

Extraction sum of squared loadings

% of variance

Cumulative %

Total

% of variance

Cumulative %

2.631%

65.783%

65.783%

2.631

65.783%

65.783%

.736

18.407%

84.190%

.452

11.296%

95.485%

.181

4.515%

100.000%

Efficiency, Effectiveness, and Predictability


Table B10. KaiserMeyerOlkin Measure and Bartletts Test Data for Efficiency,
Effectiveness, and Predictability
KaiserMeyerOlkin measure of sampling adequacy
Bartletts test of sphericity

Approx. chi square


df
Sig.

170

.828
128.263
28
.000

Table B11. Communalities for Efficiency, Effectiveness, and Predictability


Survey Question No.

Initial

Extraction

1.000

.484

1.000

.542

1.000

.671

1.000

.610

1.000

.763

1.000

.667

1.000

.571

1.000

.404

Table B12. Total Variance Explained for Efficiency, Effectiveness, and Predictability
Extraction
sum of
squared
loadings

Initial eigenvalue
Survey
Question
No.

Total

Rotation
sum of
squared
loadings

% of
variance

Cumulative
%

Total

% of
variance

Cumulative
%

Total

3.604

45.053%

45.053%

3.604

45.053%

45.053%

3.603

1.108

13.845%

58.898%

1.108

13.845%

58.898%

1.109

.926

11.580%

70.478%

.730

9.123%

79.601%

.544

6.801%

86.402%

.447

5.594%

91.995%

.337

4.209%

96.204%

.304

3.796%

100.000%

171

Easy Access
Table B13. KaiserMeyerOlkin Measure and Bartletts Test Data for Easy Access
KaiserMeyerOlkin measure of sampling adequacy
Bartletts test of sphericity

.633

Approx. chi square


df
Sig.

73.029
28
.000

Table B14. Communalities for Easy Access


Survey Question No.

Initial

Extraction

1.000

.692

1.000

.630

1.000

.672

1.000

.648

1.000

.597

1.000

.677

1.000

.588

1.000

.603

172

Table B15. Total Variance Explained for Easy Access


Extraction
sum of
squared
loadings

Initial eigenvalue

Rotation
sum of
squared
loadings

Survey
Question
No.

Total

% of
variance

Cumulative
%

Total

% of
variance

Cumulative
%

Total

2.417

30.209%

30.209%

2.417

30.209%

30.209%

2.226

1.568

19.595%

49.804%

1.568

19.595%

49.804%

1.605

1.124

14.049%

63.853%

1.124

14.049%

63.853%

1.277

.909

11.362%

75.214%

.642

8.020%

83.234%

.540

6.756%

89.990%

.413

5.166%

95.156%

.388

4.844%

100.000%

Rule of Law and Equity


Table B16. KaiserMeyerOlkin Measure and Bartletts Test Data for Rule of Law and
Equity
KaiserMeyerOlkin measure of sampling adequacy
Bartletts test of sphericity

Approx. chi square


df
Sig.

173

.637
69.793
21
.000

Table B17. Communalities for Rule of Law and Equity


Survey Question No.

Initial

Extraction

1.000

.486

1.000

.509

1.000

.606

1.000

.409

1.000

.816

1.000

.624

1.000

.364

Table B18. Total Variance Explained for Rule of Law and Equity
Extraction
sum of
squared
loadings

Initial eigenvalue
Survey
Question
No.

Total

Rotation
sum of
squared
loadings

% of
variance

Cumulative
%

Total

% of
variance

Cumulative
%

Total

2.630

37.572%

37.572%

2.630

37.572%

37.572%

2.203

1.183

16.901%

54.473%

1.183

16.901%

54.473%

1.610

.945

13.504%

67.977%

.777

11.106%

79.083%

.693

9.893%

88.976%

.431

6.162%

95.138%

.340

4.862%

100.000%

174

Civil Society Awareness


Table B19. KaiserMeyerOlkin Measure and Bartletts Test Data for Civil Society
Awareness
KaiserMeyerOlkin measure of sampling adequacy.
Bartletts test of sphericity

.752

Approx. chi square


df
Sig.

129.078
6
.000

Table B20. Communalities for Civil Society Awareness


Survey Question No.

Initial

Extraction

1.000

.007

1.000

.907

1.000

.885

1.000

.868

Table B21. Total Variance Explained for Civil Society Awareness


Survey
Question
No.

Initial eigenvalues
Total

% of variance

Extraction sums of squared loadings

Cumulative %

Total

% of variance

Cumulative %

2.667

66.682%

66.682%

2.667

66.682%

66.682%

.998

24.947%

91.628%

.204

5.090%

96.719%

.131

3.281%

100.000%

175

APPENDIX C. FRIEDMAN/CHI-SQUARE TEST ANALYSIS AND


MULTIVARIATE ANALYSIS TABLES
Transparency
Table C1. Friedman Test Results for Transparency
N

52

Chi square

430.655

df

23

Asymp. sig.

.000

176

Table C2. Friedman Chi-Square for Goodness-for-Fit Test Results for Transparency
Survey Question No.

Chi square

df

Asymp. sig.

64.731a

.000

38.231b

.000

22.077b

.000

44.923c

.000

38.923c

.000

37.538c

.000

40.769c

.000

64.154a

.000

40.308a

.000

10

52.769a

.000

11

17.615b

.001

12

36.846b

.000

13

15.115c

.004

14

20.115c

.000

15

12.615c

.006

16

8.769c

.033

17

26.077a

.000

18

64.538a

.000

19

32.038a

.000

20

35.231b

.000

21

28.308b

.000

22

30.500c

.000

23

10.500c

.033

24

25.692c

.000

Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 10.4.
Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 8.7.
c
Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 13.0.
b

177

Accountability
Table C3. Friedman Test Results for Accountability
N

52

Chi square

195.092

df

14

Asymp. sig.

.000

Table C4. Friedman Chi-Square for Goodness-for-Fit Test Results for Accountability
Survey Question No.

Chi square

df

Asymp. sig.

38.192a

.000

25.885a

.000

25.115a

.000

37.231a

.000

22.038a

.000

32.000b

.000

47.231b

.000

21.077a

.000

20.115a

.000

10

14.346a

.006

11

8.385a

.078

12

12.423a

.014

13

22.808a

.000

14

16.308a

.001

15

24.346b

.000

Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 10.4.
Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 8.7.

178

Corruption Control
Table C5. Friedman Test Results for Corruption Control
N

52

Chi square

3.069

df

Asymp. sig.

.381

Table C6. Friedman Chi-Square for Goodness-for-Fit Test Results for Corruption Control
Survey Question No.

Chi square
df
Asymp. sig.
a

17.423a

11.269a

24.385b

20.923b

.002

.024

.000

.001

Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 10.4.
Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 8.7.

Efficiency, Effectiveness, and Predictability


Table C7. Friedman Test Results for Efficiency, Effectiveness, and Predictability
N

52

Chi square

61.423

df

Asymp. sig.

.000

179

Table C8. Friedman Chi-Square for Goodness-for-Fit Test Results for Efficiency,
Effectiveness, and Predictability
Survey Question No.

Chi square
df
Asymp. sig.

40.462a

23.769b

41.692a

39.731b

42.808b

51.654b

35.500b

56.462c

.000

.000

.000

.000

.000

.000

.000

.000

Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 10.4.
Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 8.7.
c
Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 13.0.
b

Easy Access
Table C9. Friedman Test Results for Easy Access
N

52

Chi square

99.792

df

Asymp. sig.

.000

Table C10. Friedman Chi-Square for Goodness-for-Fit Test Results for Easy Access
Survey Question No.

Chi square
df
Asymp. sig.

37.308a

72.808b

21.154a

41.077c

13.192b

32.000a

90.308b

22.808b

.000

.000

.001

.000

.010

.000

.000

.000

Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 10.4.
Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 8.7.
c
Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 13.0.
b

180

Rule of Law and Equity


Table C11. Friedman Test Results for Rule of Law and Equity
N

52

Chi square

35.992

df

Asymp. sig.

.000

Table C12. Friedman Chi-Square for Goodness-for-Fit Test Results for Rule of Law and
Equity
Survey Question No.

Chi square
df
Asymp. sig.

128.462a

82.615b

80.462b

45.692b

136.269c

26.000d

50.308c

.000

.000

.000

.000

.000

.000

.000

Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 10.4.
Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 8.7.
c
Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 13.0.
d
Zero cells (0.0%) have expected frequencies less than 5. The minimum expected cell frequency is 17.3.
b

Civil Society Awareness


Table C13. Friedman Test Results for Civil Society Awareness
N

52

Chi square

41.699

df

Asymp. sig.

.000

181

Table C14. Friedman Chi-Square for Goodness-for-Fit Test Results for Civil Society
Awareness
Survey Question No.

Chi squarea
df
Asymp. sig.
a

43.192

19.923

13.385

20.692

.000

.001

.010

.000

Zero cells (0.0%) have expected frequencies less than 5; the minimum expected cell frequency is 10.4.

182

Multivariate Analysis of Variance


Table C15. Multivariate Analysis of Variance: Descriptive Statistics
Construct

Respondent

Mean

Std. deviation

Transparency

Bidder
Public entity
Regulatory/oversight
Total

3.1673
3.3134
3.4817
3.3019

.44177
.44267
.51882
.45066

11
35
6
52

Accountability

Bidder
Public entity
Regulatory/oversight
Total

2.8236
2.7357
2.7883
2.7604

.84872
.79579
.68464
.78151

11
35
6
52

Corruption Control

Bidder
Public entity
Regulatory/oversight
Total

2.7955
2.6357
2.4167
2.6442

1.02967
.96509
.93095
.96170

11
35
6
52

Efficiency, Effectiveness,
and Predictability

Bidder
Public entity
Regulatory/oversight
Total

3.7864
3.2989
3.8550
3.4662

.61907
.66130
.42208
.66578

11
35
6
52

Easy Access

Bidder
Public entity
Regulatory/oversight
Total

3.5827
3.0023
3.2100
3.1490

.58378
.59570
.52805
.62171

11
35
6
52

Rule of Law and Equity

Bidder
Public entity
Regulatory/oversight
Total

3.8573
4.0209
4.1417
4.0002

.39852
.47146
.31403
.44277

11
35
6
52

Civil Society Awareness

Bidder
Public entity
Regulatory/oversight
Total

3.1364
2.5714
2.3750
2.6683

.83937
.82598
.75416
.84413

11
35
6
52

183

Table C16. Multivariate Analysis of Variance: Tests

Effect
Intercept

Value

Hypothesis
df

Error
df

Sig.

Partial
eta
Noncent. Observed
squared parameter
power

Pillais
trace

.987 483.144a

7.000 43.000 .000

.987

3382.009

1.000a

Wilks
lambda

.013 483.144a

7.000 43.000 .000

.987

3382.009

1.000a

Hotellings 78.651 483.144a


trace

7.000 43.000 .000

.987

3382.009

1.000a

Roys
78.651 483.144a
largest root

7.000 43.000 .000

.987

3382.009

1.000a

Respondent Pillais
trace

.527

2.250

14.000 88.000 .012

.264

31.502

.954

Wilks
lambda

.525

2.336a

14.000 86.000 .009

.276

32.707

.961a

Hotellings
trace

.806

2.418

14.000 84.000 .007

.287

33.854

.967

Roys
largest root

.654

4.113

7.000 44.000 .001

.396

28.794

.972

The statistic is an upper bound on F that yields a lower bound on the significance level.

184

Table C17. Multivariate Analysis of Variance: Tests of Between-Subjects Effects


Dependent
variable

Type III
sum of
squares

df

Transparency

.398a

.199

.979

.383

.038

1.958

.211a

Accountability

.070b

.035

.055

.946

.002

.110

.058b

Corruption
Control

.565c

.282

.297

.744

.012

.594

.095c

Efficiency,
Effectiveness,
and
Predictability

3.015d

1.507

3.770

.030

.133

7.540

.661d

Easy Access

2.845e

1.423

4.132

.022

.144

8.265

.704e

Rule of Law
and Equity

.360f

.914

.407

.036

1.829

.199f

Civil Society
Awareness

3.255g

1.627

2.410

.100

.090

4.820

.463g

Transparency

346.845

346.845 1706.386

.000

.972

1706.386

1.000

Accountability

243.524

243.524

383.952

.000

.887

383.952

1.000

Corruption
Control

215.234

215.234

226.302

.000

.822

226.302

1.000

Efficiency,
Effectiveness,
and
Predictability

418.276

418.276 1046.119

.000

.955

1046.119

1.000

Easy Access

335.290

335.290

974.019

.000

.952

974.019

1.000

Rule of Law
and Equity

504.899

504.899 2566.776

.000

.981

2566.776

1.000

Civil Society
Awareness

228.314

228.314

338.135

.000

.873

338.135

1.000

Respondent Transparency

.398

.199

.979

.383

.038

1.958

.211

Accountability

.070

.035

.055

.946

.002

.110

.058

Corruption
Control

.565

.282

.297

.744

.012

.594

.095

Source
Corrected
model

Intercept

Mean
square

185

Sig.

Partial
eta
Noncent. Observed
squared parameter power

Table C17. Multivariate Analysis of Variance: Tests of Between-Subjects Effects


(continued)

Source
Respondent
(continued)

Error

Total

Type III
sum of
squares

df

Efficiency,
Effectiveness,
and
Predictability

3.015

Easy Access

2.845

Rule of Law
and Equity

Dependent
variable

Mean
square

Partial
eta
Noncent. Observed
squared parameter power

Sig.

1.507

3.770

.030

.133

7.540

.661

1.423

4.132

.022

.144

8.265

.704

.360

.180

.914

.407

.036

1.829

.199

Civil Society
Awareness

3.255

1.627

2.410

.100

.090

4.820

.463

Transparency

9.960 49

.203

Accountability

31.079 49

.634

Corruption
Control

46.603 49

.951

Efficiency,
Effectiveness,
and
Predictability

19.592 49

.400

Easy Access

16.867 49

.344

Rule of Law
and Equity

9.639 49

.197

Civil Society
Awareness

33.086 49

.675

Transparency

577.298 52

Accountability

427.374 52

Corruption
Control

410.750 52

Efficiency,
Effectiveness,
and
Predictability

647.346 52

Easy Access

535.368 52

186

Table C17. Multivariate Analysis of Variance: Tests of Between-Subjects Effects


(continued)

Source
Total
(continued)

Corrected
total

Dependent
variable

Type III
sum of
squares

df

Rule of Law
and Equity

842.078 52

Civil Society
Awareness

406.563 52

Transparency

10.358 51

Accountability

31.149 51

Corruption
Control

47.168 51

Efficiency,
Effectiveness,
and
Predictability

22.607 51

Easy Access

19.712 51

Rule of Law
and Equity

9.998 51

Civil Society
Awareness

36.340 51

Mean
square

Sig.

Partial
eta
Noncent. Observed
squared parameter power

R squared = .038 (adjusted R squared = .001). bR squared = .002 (adjusted R squared = .038). cR squared
= .012 (adjusted R squared = .028). dR squared = .133 (adjusted R squared = .098). eR squared = .144
(adjusted R squared = .109). fR squared = .036 (adjusted R squared = .003). gR squared = .090 (adjusted R
squared = .052).

187

APPENDIX D. STUDY FEEDBACK AND RECOMMENDATIONS


Step
no.

Good governance aspect observation

1
1.1

Transparency
Mandatory to publish annual
procurement plan.
Annual procurement plan should be
possible to update.
Not clear in annual procurement plan
whether budget is secured for the
procurement.

1.2

Traceability of transaction is not


adequate.
Bid opening record is not shared with
the bidders and also not published in
the portal.
Debriefing of contract award is not
available.
Best evaluated bidders are not
published.
There are no guidelines published for
using and authenticating the
transactions made in the e-procurement
portal.

1.3
1.4
1.5
1.6

1.7
1.8

Public discussion forum is not


available.
Not linked with any social media.

1.9

Public procurement performance


analytics not published.

1.10

Complaint review information not


published.

1.11

Not enabled mobile-based Short


Message Service alerts.

Recommendation

Should be updated in quarterly basis if any changes


occurred in approved annual procurement plan.
Should include procurement information on both the
electronic procurement as well as traditional
information.
Budget should be ensured and status of budget
approval should be published in annual procurement
plan.
Full audit trail of the all transactions of all users
should be recorded and traceable
Bid opening record should be shared automatically
with the bidders through e-mail, when such record is
prepared at the time of bid opening.
There should be an online debriefing facility to the
bidders who lost the contract if requested.
E-procurement portal should publish best evaluated
bidders when it issues notification of contract awards.
An e-procurement guidelines, equivalent to Public
Procurement Regulations, should be developed and
published in the e-procurement portal providing clear
strategy for implementation, terms and conditions of
use, disclaimer, and authenticity of the actions taken
and data records in the e-procurement portal as well
as provide validity to the changes made in processes
and practices to the traditional procurement processes
and practices.
There should be an open platform for the discussions
on procurement issues online.
As the trend and impact of social media is
tremendously high on citizen and stakeholder
engagement, e-procurement portal needs social media
enablement linking with Facebook, LinkedIn, and
Twitter to disseminate the procurement opportunities,
as well as public-procurement-related information.
E-procurement portal should publish statistics and
analytics on the public procurement performance of
the public procuring entities in detail in regular basis
for public awareness.
E-procurement portal should publish the lodged
complaints and the outcome of the review of the
complaints for public awareness.
E-procurement system should also use the mobile
Short Message Service for sending alerts of
opportunities and important events in the portal on a
subscription basis.

188

Step
no.

Good governance aspect observation

1.12

Trend of low bidding is challenging for


quality execution of the contracts. Low
bidding raised some challenges: (a)
contractors compromise on quality, (b)
contractors quit contract during its
execution, (c) contract remains
incomplete, and (d) increase in contract
variations.

2
2.1

Accountability
There is no code of conduct for all the
actors of the procurement process.

2.2

Accountability is misunderstood
requiring to maintain only by the public
officers.

2.3

User ID and passwords are used in


public procurement entities for carrying
out the transactions on behalf of the
authorized officers.

Recommendation
To resolve this challenges, some options are
recommended: (a) Disclose the estimated cost of the
procurement; (b) To control at the time of bid
submission, if the bid is substantially low.
Permissible minimum offer can be set in the system,
but for this public procurement regulatory and
monitoring agency should work out on the reliable
price index to be used for preparing the estimate of
the procurements; and (c) Increase the weight
substantially in quality criteria, giving less weight to
price.
Code of conduct with commitment on confidentiality,
nondisclosure of the e-procurement data content,
incomplete and unauthorized data should be enforced
in the system to ensure the accountability in the
system and also outside the e-procurement system.
Needs a communication and awareness program to
make all the actors (i.e., public officers,
regulatory/oversight agencies, bidders and civil
society) in the procurement process and outside
realize their accountability.
Needs a change management program followed by a
comprehensive business process reengineering to
streamline the processes and practices, and also
capacitate the users on the new environment updating
their perception, knowledge, attitude, leveraging the
potential of e-procurement in a real sense.

189

Step
no.
2.4

2.5

2.6

2.7

Good governance aspect observation

Recommendation

Knowledge is lost and accountability is


diluted because of using personal email accounts, obtained from free
online e-mail services (i.e., e-mail
accounts from Gmail, Yahoo,
Microsoft, and other known and
unknown service providers) in
procurement transactions and
communications in e-procurement
system.
The e-procurement system sends
automated e-mails and transactionrelated information to the e-mail
account submitted at the time of their
registration. When employees are
transferred to another organization or
discontinue their employment, or have
bad relationship with the authority of
the organization, the information and
communication carried out through the
use of personal e-mails are lost and
knowledge and accountability not
retained in the organization. It is not
traceable.
The workflow process is there in the eprocurement system but it should be
linked with the threshold given for the
approving authority, and linked with
given mandates or roles.
The authority given to the public
procurement officers for making
decisions on varied and complex
procurement is not adequate and also
not linked in e-procurement system
with their roles or mandates.
Contract management module is not
implemented yet.

Enforce an e-mail policy of using only official e-mail


account either organization domain name based email account issued by the corresponding
organization or, the account issued by the
government for its employees, or the e-mail account
offered by the e-procurement system. This will help
to recover the information, and also reuse the same email account by new employee just changing user
password.

It appeared that many of the attributes


associated with accountability were
attributed to public procurement
entities and officers, whereas all the
actors involved in the procurement
process are accountable.

The public entity officials could be made more


accountable only by giving appropriate and adequate
authority, defining timeline for actions, thresholds of
their authority, rewards for accomplishments and
punishment or room for improvement, which could
be built in to the e-procurement system.

Contract management module should be developed


and implemented to make all actors accountable for
ensuring the quality of deliveries within the agreed
time and cost with the highest level of ethical
behavior and attitude in executing the contracts.
Clear communication program for all actors of the
procurement process should be executed to
strengthen perception, knowledge and attitude
towards accountability and its nature and scope.

190

Step
no.

Good governance aspect observation

Recommendation

3
3.1

Corruption Control
Face-to-face interaction at the time of
original hard copy submission of bid
security, hard copy submission of
online bids, requirement of physical
participation of bidders in prebid
meeting and bid opening (optional) is
still encouraging corruption.

3.2

There is no facility to monitor and


control the contract execution in eprocurement system.

4
4.1

Efficiency, Effectiveness, and Predictability


E-procurement system does not have
Areas of efficiency gain, and effectiveness of the
evaluation and contract management
using taxpayer money could be achieved only
module.
through proper execution of the contracts, so contract
management is important.
Evaluation should be semiautomated.
Authority given to the public entity
Workflow also should be linked with the roles and
users is not adequate, and roles should
authority.
be clear.
Compliance validation is limited.
All the compliance requirements of the Public
Procurement Act, Public Procurement Regulations,
directives, outcome of reengineering should be
incorporated in the e-procurement system.
There is a lack of knowledge of all the
Training programs should be designed to provide the
important features of the e-procurement users training on getting real benefit and showing
system.
ways how the procurement can be done efficiently,
effectively, and how to get benefit from the
predictability features.

4.2
4.3

4.4

4.5

Reuse facility of bidding documents


and bids are not known.

5
5.1

Easy Access
Browsing speed is slow.

Adequate and effective business process


reengineering is required to be carried out, and
develop fully online mechanisms to eliminate face-toface interactions between bidders and the public
procuring entities before contract awards.
Bid security could be submitted through the banks
developing a module for the banks, providing
functions to receive payments for registration of
bidders, purchasing bid documents, issuing and
managing bid securities and other guarantees, and
also making payments to the bidders.
Prebid meetings can be carried out using online
interactive discussion forums in private mode.
Bid opening can be done automatically by the eprocurement system, or by the authorized users of
public procuring entities and subsequently share the
bid opening records to all the bidders.
The e-procurement system can provide greater
control by developing a comprehensive e-contract
management system, linking with the quality control,
payments and expenditure tracking mechanisms.

Bidding documents for public procuring entities, and


old bid document for bidders should be possible to
reuse with minor corrections in similar contracts.
Upgrade of datacenter with high-end servers, and
network equipment with failover arrangement and
higher Internet bandwidth is recommended.

191

Step
no.

Good governance aspect observation

Recommendation

There are no guidelines on using eprocurement system and legal validity


of the transaction and records in the eprocurement system.
Bidders getting support from the public
procuring entities at the time of bid
submission was observed.

E-government procurement guidelines outlining the


use of e-procurement system, and ensuring the legal
authenticity of the transactions and records should be
developed and issued as soon as possible.
This is conflict of interest, and should be stopped.
Bidders should be trained for changes in their
perception, knowledge, and attitude in new electronic
environment transforming from the traditional one.
Clear change management program should be
developed and implemented.

5.4

Weak knowledge about complaint


lodgment and its process.

The e-procurement system should provide easy


access to the process of complaint lodgment, and also
access to the review decisions.

6
6.1

Rule of Law and Equity


There are ambiguities between
traditional procurement process and eprocurement process in different
aspects.
Many bidders do not know about eprocurement system and the process for
participating in e-procurement.

5.2

5.3

6.2

6.2

There are only limited number of


bidders registered in the e-procurement
system.

7.
7.1

Civil Society Awareness


There is no platform for open
discussion on the procurement issues.

7.2

There is no clear policy of citizen as


watchdog in public procurement.

7.3

There is no helpdesk available in the eprocurement system.

7.4

There is no access provided to


oversight agencies.

E-government procurement guidelines should be


brought out as soon as possible to eliminate such
ambiguities.
Public procurement regulatory and monitoring
agency is advised to start rigorous campaign to build
awareness about the e-government procurement, and
also bring in as many bidders as possible in the eprocurement system.
Only a critical mass of bidders registered in the eprocurement system, and competing in the
procurements may bring value-for-money as well as
promote the principle of equity in the procurements.
In absence of adequate number of bidders in the eprocurement system, it will only institutionalize the
organized syndication, cartel, and other malpractices.
It is recommended to include an open discussion
forum for the general public to participate and discuss
on the procurement-related issues.
Public procurement regulatory and monitoring
agency is advised to work on the policy for citizen
engagement in public procurement monitoring.
Public procurement regulatory and monitoring
agency is advised to provide helpdesk in its next
version of e-procurement system with the helpdesk so
that general public as well as all users can get quick
support and response in relation to procurements.
Public procurement regulatory and monitoring
agency is advised to provide ad hoc access to audit
trail and other forensic information for the
investigation of fraud and corruption cases.

192

APPENDIX E. E-GOVERNMENT PROCUREMENT


IMPLEMENTATION FRAMEWORK
Most of the governments around the world are undertaking the initiations to
implement e-government procurement (e-GP) systems as a tool for public procurement
reform for enhancing good governance in the public procurement sector. The introduction
of the e-GP system is expected to enhance the good governance, achieve better value-formoney in the public procurement sector and support the socioeconomic development of
the country. Also as a result of the implementation of the e-GP system is expected to
improve transparency in the procurement process, ensure accountability, rule of law,
equity and competitiveness, improve corruption control, and increase civil society
awareness in regards to the public procurement. The implementation of e-procurement
has been considered one of the most promising and feasible options for the governments
in rendering enhanced governance in the acquisition of goods, works and services for the
public sector. Success of the e-GP implementation depends on numerous interdependent
factors and processes, which are sometimes ignored or not considered by the
implementers during its planning and implementation process. Governments around the
world have faced numerous challenges during implementation and adaptation of the e-GP
system, because of not having comprehensive framework for e-GP implementation with
adequate guidance.
This framework intends to provide step-by-step guidance to the governments or
organizations preparing for the introduction of e-GP system for good governance or
wants to improve the implementation strategy for achieving better results from the e-GP
193

systems. The e-GP implementation framework includes a comprehensive set of steps to


be taken and interventions to be considered for the introduction, implementation and
adaption of the e-GP system. The framework covers the challenges to be addressed at the
political level, administrative level, private sector and public community levels, as well
as legal, technical, and institutional level.
The e-GP implementation framework developed as part of the research is based
on the best practices and lessons learned from the experience, challenges, and solutions
adapted by many countries in implementing the e-GP system. The proposed e-GP
framework can be customized based on the country context in line with the focus of the
countries, their readiness, priorities, and strengths.
The e-GP implementation framework is divided into three broader phases (see
Figure E1): (a) Consensus Building, (b) Foundation Building, and (c) Implementation.
Recommended steps for the implementation of e-GP system is provided in Table E1 at
the end of this appendix.
Many indicators may inform a need of public procurement reform in the country.
country procurement assessment report, country integrated fiduciary assessment of public
financial management and procurement using the public expenditure and financial
accountability performance measurement framework of performance indicators and the
Organization for Economic Co-operation and Development Assistance Committee
country procurement assessment framework of baseline and compliance indicators and
other assessments carried out at different stages by the World Bank or other agencies may
inform such reforms.

194

Figure E1. E-government procurement implementation framework.

Step 1: Situational Analysis and Consensus Building


Step 1.1: Leadership/Sponsor
The first step in the countrys or organizations implementation strategy is to find
a top-level leader or a senior-level person in the country or in each agency who could see
the long-term benefits and champion the move to e-procurement. It is important to make
a business case and convincing that first level why this is a good thing and why this is
going to help the state and their agency. Once there is a political and/or executive leader,
that leader plays a key role in marshaling the rest of the forces. If that leadership is not on
board, the whole initiative may be uncontrollable or, at the least, very difficult. So the

195

first thing in initiating the e-GP would be identifying who that key sponsor was going to
be and working hand-in-hand for the initiative.
Step 1.2: Situational Assessments
To assess the current procurement status, it is recommended to carry out a
procurement performance baseline study for setting benchmark of the current
procurement performance of the public procuring entities, and regulatory/oversight
agencies as well as bidding community.
Step 1.3: E-GP Readiness Assessment
Based on the information from the baseline study, an e-GP readiness and
feasibility assessment should be carried out enhancing the assessment tool developed by
the Multilateral Development Bank for assessing the readiness of countries under nine
areas (see Figure E2) for the introduction of e-GP. The e-GP self-assessment
questionnaire should be sent to the key ministries, public procurement
regulatory/oversight agencies, procuring entities covering urban and regional areas,
professional and civil societies, information technology and telecom authorities, mobile
service providers, private sector businesses, the bidding community, and public
enterprises.
E-GP readiness assessment provides the status of the country against nine key
dimensions essential for the introduction of e-GP in the country. The results of the
benchmarking and e-GP readiness assessments should indicate that the country has good
levels of preparedness or supporting programs for such readiness.

196

Figure E2. E-government procurement readiness assessment.

Step 1.4: E-GP Strategy and Roadmap


E-procurement strategy should envision value-for-money and establishing good
governance in public procurement implementing the e-procurement system throughout
the country with a set of objectives against which the e-procurement program can be
monitored. The objectives could be summarized as three broad and high-level objectives
as shown in Figure 1, namely (a) improved governance through enhanced transparency
and accountability, (b) effectiveness through management information and efficient
processes, and (c) economic development through competitiveness and improved
investment climate. Key performance indicators should been identified under each of the
strategic objectives and targets should be set for the period of time for monitoring the
progress.
197

The e-GP strategy also should address policy issues in relation to legal, technical,
administrative, capacity building, governance model, sustainability model, human
resources model, authentication, third-party services (i.e., e-payment, Short Message
Service alert, etc.), operations and maintenance models, and a roadmap with clear action
plan for the implementation. A relevant competitive authority in the country should
endorse the e-GP strategy with full ownership and commitment for the implementation of
e-GP.
Step 1.5: Sensitization
Public awareness on e-GP and its benefits, challenges, purpose of
implementation, role of stakeholders should be communicated to general public, and
especially the political level, top-level administrator, policy makers, and civil societies
for the maximum utilization and sustainability of the e-GP system. This activity can be
implemented through organizing sensitization programs like workshops, seminars, audiovideo programs in radio and TV, and in paper media.
Step 2: Foundation Building
Development and adoption of a nationwide e-procurement system is one of the
key public sector management reform initiatives of a government. Step 2 activities will
prepare groundwork for the implementation of e-procurement system preparing itself
with the different preparatory tools, documents and capacities. Foundation building
activities include business process reengineering of the procurement processes and
practices, development of e-GP guidelines, development of business, functional, and
technical specifications of the e-GP system.
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Step 2.1: Securing Budget


Securing the funding to ensure implementation happens as scheduled plan instead
of piecemeal is an important element of the preparatory process of e-GP system
implementation. It is important to secure required budget upfront to cover all the
activities. The budget should cover not only the software and hardware but also operation
and maintenance costs as well as change management and capacity-building costs.
Step 2.2: Business Process Reengineering
Mere automation of the paper-based procurement system does not give desired
efficiency, and leverage the available technology. It is important to streamline the manual
process and practices by business process reengineering first, which help improve the
efficiency gains benefits because of the streamlined procurement process. Current
procurement processes and practices should be reengineered to use modern technology.
This will require changing the way the procuring entities prepare the bidding documents,
bidders prepare the bids, fees are collected for the bidding dossier purchase, bid securities
are handled, processes evaluated and communication with the bidders and other
stakeholders is managed, contracts are managed, and complaints are handled.
Simplified/reengineered procurement processes and practices will allow the
stakeholders to operate in a transparent, efficient, cost-effective, and timely manner and
reduce administrative burdens on procuring entities and bidding communities leveraging
the e-GP.
Step 2.3: E-GP Guidelines
Transition from a paper-based procurement system to an electronic system entails
significant reengineering in process, practices, and means as well as brings up a new
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relationship with existing and new stakeholders. When most of the requirements of
compliance with the procurement acts and regulations are automatically addressed by the
e-GP system, new areas of performance-based roles of agencies are emerged.
Automation of processes and practices under the e-GP will generate new
relationships between stakeholdersregulatory/oversight agencies, bidding community,
banks, and with others, and new roles to be performed by different agencies. For
example, the e-GP system would have to be linked with different government e-services
for accessing, verifying, and validating the authenticity of the data to be used in e-GP. In
addition, the different laws and regulations governing electronic transactions (e.g.,
information and communications technologies, e-transaction, and e-signature acts) as
well as national e-government strategies, e-procurement strategies and other master
guidelines, would have to be synchronized and harmonized with the Public Procurement
Act and Public Procurement Regulations.
For making the implementation of the e-GP system well-accepted and free of
ambiguities while the majority of procuring entities are still following the paper-based
procurement practices, introducing the e-GP system should be supported by the
introduction of e-GP guidelines adequately endorsed by relevant competent authority of
the country. In addition to the e-GP guidelines, the standard bidding documents also to be
reengineered making friendly with the e-GP system requirements. This requires that e-GP
guidelines to govern the operation, use, performance monitoring by defining procurement
performance monitoring framework, and scope of the e-GP system in the country. The eGP guidelines will serve as the governing principles
Step 2.4: Development of E-GP Business,
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Functional and Technical Specifications


The government initiative towards the introduction of a unitary e-GP in the
country can generate significant efficiency gains in public procurement sector. The e-GP
system improves transparency, accountability, procurement management, strengthens
documentation, compliance and performance audit capabilities around the procurement
function and improving good governance in public procurement sector.
The e-GP specification should be based on the prevailing acts, regulations,
practices, and e-GP guidelines and at the same time taking leverage of the information
and communications technologies to make the public procurement transparent, efficient,
effective, and cover the end-to-end procurement processes for all procurement methods
with adequate reengineering. It should clearly indicate the business, functional, and
technical requirements of e-GP system providing functional facilities to all the major
users.
It should define the complete scope of the e-GP system and then define the
deliverables by the software supplier and prepare the bidding document for national or
international competitive bidding for the acquisition of an e-GP system.
Major functionalities to be supported by the e-GP system are listed as follows:

Centralized registration system for procuring entities, and all other users of eprocurement system

User-specific administrative dashboards

E-bidding (covering all processes and procurement methods for goods, works,
and services supported by public procurement law and regulations of the
country from demand aggregation, annual procurement plan preparation, eadvertise, e-submission, e-evaluation, e-notice to signing of contract)

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E-catalog

Simplified bidding (e-quoting)

E-framework agreements and their management

E-auctions (forward and reverse auction)

E-contract management system

E-invoicing, payment, and guarantee (through banks and other options)

Complaint and dispute handling

E-procurement performance measurement and monitoring system

Interface with Integrated Financial Management System, company registrars


office, banks, tax, and other e-services relevant to e-GP

User activities under administrative workflow and system audit trails

Online help

Functionalities could be more or less based on the country context.


Step 3: Implementation and Adaptation
Step 3.1: Acquisition of E-GP System
In implementation, acquiring e-GP system is pivotal. There are different options
for acquiring the e-GP application:

Off-the-shelf e-GP application with customization (recommended)

Custom-tailored

Software-As-A-ServiceCloud-based, future trend

Government-to-government support

Acquisition of the e-GP system is recommended to carry out through an


international competitive bidding inviting the bidders having already developed e-GP
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system with required configuration and customization to map with the countrys e-GP
requirements. There are many off-the-shelf e-GP applications available in the market,
which can be used with minimum configuration of parameters, and changes. The e-GP
system supplier will be required to develop the functionalities if any requirements
specific to the country procurement environment are not available in offered existing
system. The e-GP system should be procured with the perpetual license and license to
modify and update the source code by the client as required, and to be used across the
country in all the procuring entities, public entities, all other users including national and
International bidders.
Step 3.2: Data Center Preparation
Preparation of data center includes the assistance for building data center.
Building the data center involves installation of power solutions and power backup,
precision air-conditioning, fire alarm system, digital closed-circuit television, surge
suppressor, access control system, water detection system, dehumidifier, pest repellent,
data rack, raised flooring, electrical and civil works, and passive components like
network cables, patches, and so on, procurement of data center and mirror center servers,
network equipment, storage, power solution, Internet connectivity, and required system
software and licenses
Step 3.3: Capacity Building and Change Management
Change management is one of the important activities to be carried out at all
levels of user environments for the successful adaptation of the e-GP system. For public
procuring entities, the new rules and practices in the electronic environment will require
changes to the way they work, for example, in use of new procedures, as well as the
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technology mandates. For some, the appropriate technology will already be in place. For
others, that are operating public procurement in a purely manual manner, there is a need
to take necessary change actions in short time to ensure e-GP system can be properly
implemented. Change management could be a mammoth, but sometimes you can
piggyback the already started initiatives. Sometimes, if the country already have
implemented any e-services, like IFMIS, the trails made by those implementations can be
followed. For the change management, changes to be managed in the following areas:

Structural/institutional

New relationship management with new and old stakeholders

Administrative processes and practices

Emotional change managementEmotional readiness is very important for


success.

Developing leadership at political, social, different levels of government


bureaucracy, private sector bidding community

Managing resistance in public procuring entities and bidding community

Devolved power management

Capacity enhancement and building


For capacity building, the following activities could be carried out:

Different levels of training program should be conducted to address the


capacity needs of different users involved in the procurement processes
(i.e., training programs for procuring entity procurement users, bidders,
evaluation committee members, accounting officers, bank users, oversight
agency users, etc.). Training programs will be in the form of regular
courses as well as ad hoc trainings on demand basis. Training programs
should be conducted at the all-administrative levels of public procurement.

Benchmark study visits for the selected key users should be conducted in
few of the developed and developing countries for gaining knowledge and
learn from the experience on the implementation of e-GP system.
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For the effective adaptation of the e-GP system by its key users and make
the e-GP system successful, initial support on its operation, maintenance,
implementation management is very important. For this, it is important to
establish helpdesk, resource with project management team and resources
for e-GP and data center operation and maintenance.

3.4: Pilot and Full Rollout Across All Public Procuring Entities
Implementation of e-GP system is recommended to be adopted in phased rollout
model as opposed to the traditional phased module activation model. This means that the
initial system developed shall cover all methods of procurement and stages of the
procurement process and all the required functionality to enable piloting of a complete
system. Procuring entities will chose which procurement method to start with based on
their availability of procurement packages under the annual procurement plan.
Phasing should be standalone. E-procurement processes should be complete for
any procurements. Options of parallel submission of hardcopy bids and also online
submission for the same procurement should not be encouraged. It options provided, it
will only delay the adaptation of the e-GP system and support the procurement reform in
true sense. All the procurement methods should be developed from the very beginning.
Otherwise with this what happens is that even a department using e-procurement will
have to use e-procurement for one of the procurement and manual system for others. This
kind of e-procurement implementation does not give desired benefits. It also does not
improve efficiency of the agency but adds more burden for capacity requirements as well
as resources for both types of procurements. It will only promote systemic corruption.
Phases of rollout would be divided into two phases:
1. Pilot in selected agencies
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2. Wider rollout throughout the country


The e-procurement system implementation should be in phased manner selecting
few key public procuring entities, which provides an opportunity to reduce the eprocurement system failure risks, test the functionalities and processes in e-procurement
system, and extend the demonstration effect in rolling out the system in other procuring
entities based on the success during pilot implementation. It helps enhance the rollout
plan based on the lessons learned during pilot implementation.
Success of the implementation of e-GP depends on many factors. Some of the
major factors are the readiness of the agencies in terms of willingness and commitment of
leadership in the organization to take up e-procurement, the level of use of information
and communications technologies by the procurement-process-related personnel, and
diversity of procurements carried out by those agencies.
Number of pilot agencies to be nominated depends on the country context. It
could be four to 10 pilot agencies, considering their willingness and commitment to drive
e-procurement initiative and information and communications technologies readiness:

One or two representative pilot agencies each could be chosen from among
the agencies focusing on goods, works and services procurement

Procuring entities with specific nature of procurements (i.e., medical,


information and communications technologies, rations, etc.)

Procuring agencies already doing some forms procurement automation

Procuring agencies representing geographical reach and including at least two


local governments (only agencies passing the readiness requirements)

The procurement regulatory agency of the country as the administrator of the


e-procurement system

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Wider rollout implementation will be carried out based on further assessment of


the procuring entities on their readiness.
Rollout strategy also could be carried out based on (a) stages of procurement
processes, (b) procurement method, (c) threshold, (d) readiness, and (e) strategic
government priority sector.
3.5: Operations and Management
Regular system maintenance, updating e-GP portal content, updating procurement
rules and processes, supporting e-GP users, and ensuring availability of e-GP system to
its users all the time should be addressed through a well-designed operation and
management policy. The operation and management arrangement should be made in such
a way that the e-GP system is up and running all the time 24/7/365 for procurement
transactions, all users are supported by a helpdesk, and the e-GP portal remains always
updated with its content and processes.
3.6: Third-Party E-GP System Audit
When the e-GP system is successfully tested and stable after pilot implementation
and rollout started in other public entities, an independent audit agency is required to
verify compliance of the e-GP system to the Public Procurement Act and Public
Procurement Regulations of the country and a set of assessment guidelines drawn from
international best practices, and also actively guide and, as required, provide hands-on
support to enable the implementation comply with the stated best practices. Third-party
audit provides confidence to the stakeholders using the e-GP system, and provides
authenticity of the transactions in the system. Third-party audit may contain the following
assessments:
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Security audit. Evaluate security controls implemented in the application


software vis--vis international best practices and make recommendation on the remedial
measures to be taken to comply with the prescribed global standards. Besides the
application audit, the security audit shall review security controls in database and
operating systems.
Documentation. Prescribe documentation requirements in a typical information
technology software implementation project (i.e., both software development and
maintenance phases cover not only the software application but also the installation,
implementation, and exit/transition management activities) and actively guide the team in
getting the documentation done in line with international standards.
Server infrastructure deployment and data security. Evaluate the existing
deploymentarchitecture (server infrastructure) and actively guide the implementation
team in reconfiguration of the servers and storage such that load handling is distributed
across the servers and recovery point objective and recovery time objective are kept as
minimal as possible.Especially, server configuration and data security have to be
evaluated firsthand and hands-on guidance should be provided to the implementation
team in reconfiguration of the server infrastructure. A robust data backup policy has to be
effectively implemented.
Penetration testing. Perform external penetration testing to identify
vulnerabilities that could be exploited by users located outside the network perimeter and
provide hands-on guidance to the implementation team in strengthening perimeter
security.
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Table E1. E-Government Procurement Implementation Framework Checklist


Step
no.

Activity

Purpose

1
1.1

Situational analysis and consensus building


Identification of
Put forward e-government
leader/champion/
procurement (e-GP) initiative
sponsor

1.2

Procurement
performance baseline
survey
E-GP readiness
assessment

1.3

1.4

1.5

Development of eGP strategy and


roadmap

Sensitization about
e-GP

Outcome

Leader, sponsor, or
champion identified
Sponsor the idea of
e-GP system

Situational assessments

3 months

Readiness assessment to identify


the status of required
preparedness for the
implementation of e-GP system
To ensure top-level political and
government commitment and
define the policy, strategy and
step-by-step actions for the
successful implementation of eGP system

E-GP readiness
assessment report
with the strengths,
gaps, and perceptions
National strategy
for e-GP system
implementation
with action plan

A broad sensitization and


awareness program should be
implemented with an objective to

Strong political,
executive level
support and
commitment

Raise awareness of the e-GP


initiative
Get buy-in from stakeholders
Evaluate and get feedback on
the initiatives
Raise awareness of benefits of
e-GP
Keep stakeholders informed as
the e-GP implementation
progresses
Disseminate the outputs of the
e-GP implementation

209

Estimated
time

Political and
executive
commitment

Aware civil society


Adoption of change
by public procuring
entities and bidding
community

2 months

3 months

Table E1. E-Government Procurement Implementation Framework Checklist (continued)


Step
no.

Activity

2
2.1

Foundation building
Securing budget for
the e-GP program

2.2

Carry out business


process
reengineering

2.3

Preparation of e-GP
guidelines

2.4

Development of eGP business,


functional, and
technical
specifications

Purpose

Government commitment on eGP implementation


Streamline traditional
procurement processes and
practices in line with electronic
environment leveraging
information and communications
technologies for strengthening
transparency, accountability,
corruption control, efficiency,
effectiveness, predictability, rule
of law and equity, easy access to
information, and civil society
awareness
To provide legal and operational
authenticity of the e-GP, its
underlying electronic processes
and incorporated operational
practices different from the
traditional procurement approach,
authenticity of the transactions
done through e-GP by its users,
ownership of data and content
stored in the e-GP system,
security and institutional
arrangements for its governance,
and roles, responsibility, and
obligations of the users
Outline business, functional and
technical requirements to be
covered by e-GP system, and its
operating environment

210

Outcome

Secured required
budget for e-GP
implementation
Reengineered and
standard processes
and practices for eGP

Estimated
time

3 months

E-GP guidelines or
directive

3 months

Specification
document of e-GP
system for the
acquisition of the
system and related
services, and its
infrastructure

2 months

Table E1. E-Government Procurement Implementation Framework Checklist (continued)


Step
no.
3
3.1

3.2

Activity

Purpose

Implementation and adaptation


Acquisition of e-GP
Competitive bidding process to
system
acquire most appropriate e-GP
system for the implementation
with design, configuration/
customization, and development,
and commissioning
Data center
Preparation of data center
preparation
addressing desired security and
performance requirements for the
e-GP system operations

3.3

Capacity building
and change
management

To train users to operate e-GP


system and instill required change
culture to operate in electronic
environment leveraging
information and communications
technologies
Select limited number of
procuring agencies with full
enthusiasm and readiness in terms
of motivation, capacity, and
information and communications
technologies infrastructure to use
the innovative tool in public
procurement
Test the complete cycle of
procurements using different
procurement methods

3.4

Pilot and full rollout


across all the public
procuring entities

3.5

Operations and
management

Regular system maintenance,


updating e-GP portal content,
update procurement rules and
processes, support e-GP users,
ensure availability of e-GP
system to its users

3.6

Third-party e-GP
system audit

Ensure security, confidentiality,


and high level of operational
quality of e-GP system and its
management arrangements

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Outcome

Estimated
time

Installed operational
e-GP system

Acquisition
of e-GP
system

Physical environment
of data center with
virtual platforms for
the development,
testing, training, and
transactions
(production)
Trained users
Users with positive
attitude towards
change

3 months

Number of public
entities test the
procurement cycle in
electronic
environment
Ensured stable and
robust e-GP system
Confidence
development for
other agencies for
further nationwide
rollout
Live e-GP system all
the time 24/7/365 for
procurement
transactions
Happy users getting
required support for
its operations
Updated procurement
information and
processes
Validated and trusted
e-GP system for the
use in public
procurement

One
procurement cycle
(3 months
to 1 year)

Ongoing
during the
life of e-GP

3 months