Enhancing Supply Chain Management through Effective E-Procurement.edited

1 Enhancing Supply Chain Management through Effective E-Procurement Student’s Name Institutional Affiliation Professor’s Name Course Date

2 Contents 1.0INTRODUCTION ................................................................................................................. 4 1.1 Background of the study ................................................................................................... 4 1.2The Energy Sector in Saudi Arabia ................................................................................... 4 1.3Statement of The Problem ................................................................................................. 5 2.0LITERATURE REVIEW ...................................................................................................... 7 2.1 History of E-Procurement ............................................................................................. 7 2.2Benefits of E-Procurement in Supply Chain Management ............................................... 7 2.3Challenges When Implementing Supply Chain Management ........................................... 8 2.4 Strategies in E-Procurement ............................................................................................. 9 2.5Impacts of E-Procurement on Supply Chain Management ............................................. 10 2.6 Future of E-Procurement ................................................................................................ 11 3.0 RESEARCH METHODOLOGY ....................................................................................... 14 3.1Sampling and Participants ............................................................................................... 14 3.2 Instruments ..................................................................................................................... 15 3.3Data collection and procedures ....................................................................................... 15 3.4 Questions for Interviews ................................................................................................. 16 3.5 Data analysis ................................................................................................................... 17 4.0 RESULTS ........................................................................................................................... 18 4.2 limitations ....................................................................................................................... 18 5.0 CONCLUSION .................................................................................................................. 19 6.0 References .......................................................................................................................... 20

4 1.0INTRODUCTION 1.1 Background of the study. Supply chain management is crucial in the dynamic world of international business, where it is one of the most integral operations factors. How the management of the supply chain works goes a long way to determining a company's competitiveness and its capability to deliver goods to clients on time and at the right cost. That said, effective E-Procurement has been a key driver in changing conventional supply chains and how organizations engage in business practices. With the integration of technology and business processes, it is no longer optional for public or private organizations to use E-Procurement. E-procurement covers more than just digitization; it embodies a method of sourcing, procurement, and collaborating with suppliers, which can change the face of the entire supply chain ecosystem. Effective E-Procurement as a driving force for improving Supply Chain Management. By identifying how it affects costs, lead times, and collaborations with suppliers, we will reveal how a company can secure competitive advantages in an international marketplace. 1.2The Energy Sector in Saudi Arabia

5 In Saudi Arabia, the energy sector drives economic development, quality of life, and national security, respectively. Saudi Aramco Power Company, as a central player in the transmission and distribution of power, is mandated to ensure a strong, consistent electricity supply in the country ( Abdul et al.,2013) . It is one of the most important players in the electricity provision for the country by being a crucial power source to other energy suppliers. Recently, the energy sector has been paying more attention to E-Procurement as a means of improving SCM in the sector. This step is to improve operational efficiency and shorten the period for applications connected to the electricity grid to one-month maximum. 1.3Statement of The Problem Procurements have been central to most organizations' success regarding efficiency and effectiveness. However, e-procurement and supply chain management issues have become more complex because of costs, access to resources, professional capabilities, technical competency and the ongoing evolution of technology. The problems arise with prompt and reliable data entry, filing, decision-making, and corporate administration. In the recent past, procurement processes were paper-based and relied heavily on physical conversations where technology was not highly integrated. Thus, inadequacy in file management, data documentation, filing systems, procurement schedules, after-award contract management, and non-uniform reporting to monitoring authority became evidence of process breakdowns. However, there is little empirical research on the impact of information technology on supply chain management in an e-procurement context in Saudi Arabia's energy sector. This study endeavors to fill the existing gap in the empirical understanding of the effects of e- procurement on effective supply chain management in the energy sector by acknowledging the knowledge difference. These independent variables are Electronic Data Interchange, e- tendering, supply chain integration, and enterprise resource management.

7 integrating planning and implementation activities throughout the supply chain process, from procurement to distribution and logistics, to achieve timely consumer requirements at a minimum price. One crucial aspect of this subset of SCM is e-procurement, which has proved to be a pivotal engine of change and transformation in how companies have purchased and managed their supply chain resources. Digital procurement is different from traditional, paper-based procurement processes. Procurement using e-commerce entails the application of information technology, the internet and electronic communication to maximize the whole process of ordering and making payments right from the sourcing stage up to invoicing. Transparency, process enhancement, cost reduction, and better supplier relationships – are the four advantages of implementing e-procurement. This enables instantaneous information exchange and effective data processing and allows organizations to use data for evidence- based decision-making. In addition, E-Procurement facilitates an agile, responsive, and customer-focused supply chain. 2.2Benefits of E-Procurement in Supply Chain Management The development of e-procurement also shows that procurement practices used in the past were paper-based, and the current supply chain management is technology-driven ( Alahmad,2021 ). The concept of e-procurement can be traced back to the early days of computerization in the business world when some procurement functions started to be automated. However, e-procurement did not come into existence until the twenty-first century, when the internet was made available to everyone and more improved multimedia processing technology. It is during this time that we introduced electronic catalogs, online bidding and supplier collaboration, making the procurement process more efficient, transparent and data-driven. As time goes by, E-Procurement continues expanding its application to include, but not limited to, artificial intelligence, blockchain, and data

8 analytics, leading to enhanced capability in supply chain management and management in general. Electronic procurement offers several advantages for the SCM. It improves the procurement process by automation, reducing human errors, and promoting transparency. This ultimately results in huge savings as corporations cut costs within their structures and negotiate lower prices from their vendors. 2.3Challenges When Implementing Supply Chain Management According to Bahaddad et al. (2018), Despite the advantages of using e-procurement in supply chain management, some of the challenges and barriers must be addressed if organizations must enjoy all the benefits of this digital transformation. A significant obstacle is the resistance of employees to change. Many people will likely view e-procurement as transitioning from conventional procurement methods and thus fear losing their jobs. In addition, some workers might not be comfortable with these new technologies, requiring strong change management strategies to ensure an easy process. Another challenge is the security concerns. Data breaches, hacking and other cyber threats are possible because of the digital character of E-procurement ( Altayyar,2017 ). In this way, organizations should be investing in overall cybersecurity as a measure to guarantee the safe and confidential storage of data on procurement and to uphold the trust of their stakeholders. Financial constraints often hinder E-procurement. There could be initial investment in the E- Procurement systems, which will be quite costly to organizations with budget limits. Such additional resources could be strained by ongoing maintenance and upgrade costs as well as the cost of training. It is also important to note that expertise and training are critical in successfully accepting E- Procurement. Adoption of E-Procurement tools can also be hindered when there are untrained staff and suppliers who do not know how to use the tools. This calls for investment in training and support programs to reduce this organizational gap.

10 Mobile and Cloud Integration: Procurement professionals are enabled by mobility and cloud- based solutions, which allow them to work from anywhere, hence promoting flexibility and responsiveness ( Altayyar,2017 ). Such flexibility is especially essential in today’s supply chain settings. Automation of Approval Workflows: E-procurement systems streamline approval processes. Automated workflow ensures a minimal approval period for procurement. This ensures timely delivery without bottlenecks. Supplier Diversity Programs: One of the key ways that e-procurement can contribute to supplier diversity is through its ability to help a company monitor diverse suppliers and interact with them. Such programs lead to embracing diversity and increasing the supply base. 2.5Impacts of E-Procurement on Supply Chain Management E-procurement brings revolutionary improvements to the procurement procedures, supplier relationships, and general efficiency of the supply chain, which has a significant influence on supply chain management (SCM). The digital revolution is reshaping traditional supply chain paradigms better to meet the needs of the contemporary corporate environment. The substantial cost reductions that e-procurement provides are among its most obvious effects ( Daoud & Ibrahim,2018 ). E-procurement decreases paper-based transactions, almost eliminates mistakes, and lessens the need for manual interventions by streamlining procurement operations. Organizations may achieve significant cost savings by streamlining their procurement processes, negotiating better pricing with suppliers, and reining in erroneous expenditures thanks to these operational improvements. The shorter lead times associated with e-procurement are a major benefit. Workflow and approval automation speed up the procurement process, allowing businesses to react to consumer requests and changes in the market instantly. Reduced lead times improve the overall agility and responsiveness of the supply chain.

11 Successful e-procurement cultivates improved connections with suppliers. Through tools for performance rating, order monitoring, and real-time communication, it brings transparency and teamwork to the procurement process. These characteristics guarantee stability and dependability in the supply chain by greatly enhancing the quality of supplier collaboration. The empowerment of data-driven decision-making is another significant effect ( Daoud & Ibrahim,2018 ). Organizations may obtain real-time data and analytics using e-procurement solutions, which provide them the power to make well-informed decisions. Organizations may anticipate supply chain interruptions and optimize procurement strategies through data- driven decision-making, which improves overall strategic planning. Automated workflows, digital data, and centralized procurement repositories replace manual duties in e-procurement, resulting in simplified procurement operations. Through the reduction of administrative chores and the streamlining of the whole procurement lifecycle, these simplifications increase procurement efficiency. Furthermore, E-Procurement helps to lower mistakes in procurement processes by minimizing human error related to manual data entry and paperwork. Accurate data and records in the digital system make procurement procedures more dependable and reduce expensive errors. 2.6 Future of E-Procurement The destiny of E-Procurement in Supply Chain Management (SCM) guarantees to be a thrilling and transformative adventure as the era develops quickly ( Daoud & Ibrahim,2018 ). One of the central aspects shaping the future is the combination of advanced analytics and synthetic intelligence (AI). These technologies will revolutionize choice-making within E- Procurement systems, permitting predictive analytics to assume procurement desires and AI- pushed algorithms to optimize dealer interactions, pricing, and negotiations. The blockchain era is set to play a pivotal role in ensuring the security and transparency of procurement techniques. Its integration will provide quit-to-end visibility of transactions,

13 3.0 RESEARCH METHODOLOGY The research technique for studying the effect of E-Procurement on Supply Chain Management in the context of the strength area in Saudi Arabia involves a complete and systematic technique ( Dziopa & Ahern,2011 ). The method is designed to acquire, examine,

14 and interpret records to offer insights into the research goals. The following sections define the key additives of the study method: Research Design: This study adopted a qualitative research design, whereby data was collected through interviews and questionnaires. The research approach I will be using is a qualitative grounded theory research method. I will be using the constructivist design. Implementing the constructivist design will be best for my research study because it involves exploring the views, feelings, and beliefs of others. In choosing this specific research design, I will be able to effectively investigate ways of enhancing supply chain management using effective e-procurement methods in the energy industry in Saudi Arabia by using a small sample size and detailed interview from Saudi Aramco Power Company, which acts as the central player in the transmission and distribution of power, is mandated to ensure a strong, consistent electricity supply in the country( Kobayashi,2017). Doing so will also help me gain the data I need to understand better the various methods of e-procurement in the energy sector and how supply chain management can be enhanced using effective e-procurement methods. 3.1Sampling and participants Data Collection: The research proposes to acquire number one statistics from personnel within the electricity quarter in Saudi Arabia, which is Saudi Aramco Power Company. A stratified random sampling method is employed to choose a sample of 180 respondents from a total populace of 340. Data will be collected using semi-dependent questionnaires and interviews. 3.2 Instruments Throughout my research study, I will be collecting a few different varieties of data using methods of interviews and observations. All the qualitative data will be collected at the research site, which is Saudi Aramco Power Company. Data gathering instruments that will be used to gather the qualitative data will be an interview protocol containing instructions for the research process, an observation checklist to see how participants interact outdoors, and

16 3.4 Questions for Interviews i. Can you describe your function and duties within the supply chain control process at Saudi Aramco Power Company and the way it relates to the procurement of goods and services? ii. What are the main demanding situations or inefficiencies you have encountered in the e-procurement and supply chain methods, and the way you observe E-Procurement can address those demanding situations? iii. In your opinion, what are the important factors that impact the successful implementation of E-Procurement in the energy zone, and how have those elements impacted delivery chain management practices at Saudi Aramco Power Company? iv. Can you outline unique examples of ways E-Procurement has been used to improve the performance, fee-effectiveness, or transparency of procurement techniques inside the strength industry, and how has this affected the general supply chain? v. How do you perceive the extent of adoption and integration of E-Procurement technology inside Saudi Aramco Power Company and the broader electricity area in Saudi Arabia? Are there any limitations to adoption? vi. What are the overall performance indicators or metrics that you use to evaluate the effectiveness of E-Procurement in improving delivery chain management, and might you provide insights into the effects or effects determined? vii. In your opinion, what suggestions or first-rate practices do you have for boosting supply chain management via powerful E-Procurement methods inside the strength region? Are there any particular strategies that could benefit Saudi Aramco Power Company? 3.5 Data analysis According to Godau (2016), One method that will be used to analyze qualitative data is the MAXQDA coding method. This will help the coding process by analyzing each interview and

17 observation notes. It will also help to organize, collect and visualize the methods used to gather the data to be then able to compare and contrast each participant's perception of e- procurement. Thematic analysis will also be implemented within this research study through the process of coding in several phases, such as familiarization with data, searching for themes among codes, generating initial codes, reviewing themes, defining and naming themes, and creating the final report. I plan to code and store my data by collecting objective and subjective feedback from observations and then coding the information and putting it into themes. I will also code information from recorded interviews. Lastly, because this will be grounded theory research, I will implement a constant comparative data analysis, analyzing and comparing new information with previously attained information in the study . 4.0 RESULTS In my research study, the studies decide the extent of integrating and adopting E-Procurement technologies within Saudi Aramco Power Company and the broader power zone in Saudi Arabia. It is expected that the effects will display varying stages of adoption, with elements that include technological readiness, organizational tradition, and regulatory compliance gambling a large position. In my research study, I expect to get the results to display insights into how E-Procurement influences relationships with providers. Advanced communique, decreased lead instances,

19 per participant to get a better feel of their views, as some workers may change their minds often. 6.0 References Abdul-Majeed, M. A., Al-Hadhrami, L. M., Al-Soufi, K. Y., Ahmad, F., & Rehman, S. (2013). Captive power generation in Saudi Arabia—overview and recommendations on policies. Energy policy , pp. 62 , 379–385. Alahmad, Y. Y. (2021). The relationship between supply chain management practices and supply chain performance in Saudi Arabian firms. American Journal of Industrial and Business Management , 11 (01), 42. Altayyar, A. (2017). Investigating e-procurement barriers within six Saudi Arabian SMEs.

20 Avelar-Sosa, Liliana, Jorge Luis García-Alcaraz, and Aidé Aracely Maldonado-Macías. "Evaluation of Supply Chain Performance." Management and Industrial Engineering. Cham: Springer International Publishing (2019). Bahaddad, A. A., Drew, S., Houghton, L., & Alfarraj, O. A. (2018). Factors attracting online consumers to choose e-Malls for e-procurement in Saudi Arabia. Enterprise Information Systems , 12 (7), 856–887. Daoud, L., & Ibrahim, M. (2018, June). The factors affecting e-procurement usage: The moderating role of power. In Journal of Physics: Conference Series (Vol. 1019, No. 1, p. 012076). IOP Publishing. Dziopa, F., & Ahern, K. (2011). A systematic literature review of the applications of Q- technique and its methodology. Methodology . Godau, R. I. (2016). Qualitative data analysis software: MAXqda. Qualitative Research Journal , 4 (1), 66–72. Kobayashi, Y. (2017). Corporate Strategies of Saudi Aramco. The James A Baker III Institute for Public Policy, Rice University, Texas, US .