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French MOD e-procurement -------------------------------------------

French MOD e-procurement ------------------------------------------- ‘Possibility for businesses to fully seize market opportunities’. Michel Cadic @dga.defense.gouv.fr. The aim : to be more efficient in procurement. 30 % of RFI - RFQ are closed without contract

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French MOD e-procurement -------------------------------------------

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  1. French MOD e-procurement ------------------------------------------- ‘Possibility for businesses to fully seize market opportunities’ Michel Cadic @dga.defense.gouv.fr

  2. The aim : to be more efficient in procurement • 30 % of RFI - RFQ are closed without contract • To reduce the costs of supplies by 25 % • To give easier access to public procurement to : - SME’s • European companies • A full dematerialised process from the requirement to the payment • DGA project enlarged to MOD : 15 to 17 G€ purchase /year

  3. French MoD market place : e-purchasing approach Internet Network IXARM.COM portal Defence market place ACHATS.DEFENSE.GOUV.FR portal Contract

  4. French MoD market place : e-purchasing approach Internet Network IXARM.COM portal Defence market place ACHATS.DEFENSE.GOUV.FR portal Contract Partners Network Area Secured private Network (not link to Internet) DGA Suppliers ESPACE PARTENAIRES Others state services : minister of finance… Armed Forces

  5. Market place architecture Defence R &D www.ixarm.com Armed forces equipment • achats.defense.gouv.fr • general equipment : • infrastructure • fuel • health furniture • food • clothing Information on public procurement OTAN OCCAR Suppliers data Acquisition equipement E-catalogue Market room Consultation management RFI notice E-auctions E-invoice BOAMP JOUE >RFQ e-files technical documents E-offers by suppliers Notification e-awarding

  6. A fully operational market place since November 2002 Year 2004 statistics • 220 main purchasing entities, • Around 9000 registered users • buyers : 2000 • suppliers : 18 000 users, including 7000 registered • Higher transparency of public procurement • 100% RFQ above 90 K€ are published on the market place • 4 k€ < ± 80% RFQ published < 90 k€ • In number : • 7000 calls for tenders published (with their technical and administrative files) • More than 55 000 downloads by suppliers

  7. Statistics : call for tenders publication

  8. First aim : to fully seize market opportunities, public procurement is open to new suppliers • Portals design for supplier’s incentive : • > To Facilitate and secure the candidature step • All free access for suppliers, • All necessary information (laws, adm. formularies, how to get in touch with buying entities…), • Ordinary computer, just Internet link. • Ixarm : far further than only advertising RFQ • Both in French and English, • Description of main defence programs, • Spontaneous proposals authorized (research…) • Marketing place for supplier’s adverts on their know how

  9. Front page “ixarm.com” portal

  10. Statistics : downloads by suppliers

  11. Change Management : Key factors • Change management internal +external : 2/3 of the results • Not to be concentrated on tools • Think simple, easy to use • Demystify dematerialised process on Internet • Don’t match tool changes and buying process changes : • No big bang • Incremental process : step by step, • What are the earnings / expectations of the buyers and the suppliers : • A win-win process : • Efficient procurement needs two efficient partners

  12. Change Management towards suppliers • Actions done with success : • Meetings with professional organisations • National and local meetings at the beginning of 2004 : 1500 suppliers • Online “Handbook”, Online FAQ ,Web “Hotline” • E-call for tenders training in order to test their ability to answer correctly • Personalised home page : specified interests and be awarded of new tenders ( 173 000 alert mails sent to registered suppliers in October 2004) • Data base for suppliers : • 1st step (done) : enable Cies to download all administrative documents • 2nd step (June 2005) : Cies fill a data base in order to have not to send candidature files (75 % data common for the MOD) • In order to facilitate and secure the candidature step

  13. Difficulties and perspectives for suppliers :the most important challenge • Very good perception of the push of tenders on the market place, but reluctance to go further • To incite suppliers to register : 85% of the downloads are done by unregistered suppliers • Develop e-offers (only 213 since January 2004) v/s answers still through paper way • To generalise the opportunities to use electronic-exchanges (collaborative exchanges for programs …) • Different standards used by marketplace • Difficulty to have access to high speed network • Perception of risk level : shared between supplier and purchaser in private sector, all risk supported by suppliers in public sector. • Difference between SME and big Cies • Security approach • Internal process to elaborate offers • Responsibility / Electronic Signature delegation

  14. Focus on 2 difficulties • Electronic certificates • Survey with French partners (National Imprimery, local authorities…) on 3000 suppliers : • 7% have a certificate • > 30% don’t know where to buy it • < 30% don’t know what it’s for • It’s easier to sign a paper than by electronic way • High security certificate with face to face delivery / but it’s impossible to oblige a CEO to go himself in a post or bank office to take it • Difficult to define compromise : security / pragmatism • Encryption / anti-virus : contradiction between two goals • Public purchaser shall not be attacked by virus put in the offer • Supplier shall be confident that public purchaser will not see the offer before official evaluation committee • Trust and security : find acompromise too

  15. Conclusion for French MOD market place • Public buyer’s side : • A real success for the e-call for tenders, • Already high positive Return on Investment : • Project costs 2000-2004 :4 people project team, 7 M€ (ASP mode) • Earnings : transparency, “soft money” / administrative costs : 2 M€ in 2003, 18 M€ in 2004, “hard money” / on supplies : not yet measurable • Supplier’s side : • Success for downloads , • For other possibilities of the procurement cycle (e-tenders, reverse auctions..) : only if suppliers could find their own interest on it

  16. Conclusion • How to go further with at European level ? • Certificates : Bridge Certification Authority project to enlarge • Now it’s quiet impossible to receive trans-borders e-offers if the supplier hasn’t local (buyer) certificate • Reverse-auction code of conduct • To develop common supplier’s register • To incite development of high speed network • To prompt interoperability / standardisation (XML, private supply-chain compatible or not with public standards) • To help to conduct change management towards suppliers

  17. Questions ? • More information on : • www. ixarm.com (both in French and English) • www. achats.defense.gouv.fr (French) • mails : michel.cadic@dga.defense.gouv.fr emmanuelle.plessiet@dga.defense.gouv.fr

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