...Reverse Auctions: A reverse auction is a type of auction in which the roles of buyer and seller are reversed. In an ordinary or forward auction, buyers compete to obtain a good or service by offering increasingly higher prices. But in a reverse auction, the sellers compete to obtain business from the buyer and the participants place lower and lower bids, until the lowest bidder wins. A reverse auction is similar to a unique bid auction as the basic principle remains the same, however a unique bid auction follows the traditional auction format more closely as each bid is kept confidential and one clear winner will emerge at the completion of the auction. . The reverse auction has been widely used by many organizations and is aimed at reducing costs and sourcing services or products at the lowest possible price from the participating suppliers. Some of the benefits are: A reverse auction provides buyers with the most competitively priced solution to their needs by pitching suppliers against each other to be the one offering the lowest-priced bid. It saves time in the procurement process and also streamlines the procurement process as well as reduces the need to send a different request for proposal to each potential supplier. It equally has some disadvantages that makes it a bad method like creating problems when proper controls are not put in place. Competition for the lowest price can make some suppliers to cut corners to maximize benefit or even send them out of business...
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...The Benefits of Electronic Reverse Auctions (e-RAs) in the Procurement Process The nature of business competition is changing drastically. One of the most profound changes currently transpiring in the world of business is the introduction of electronic commerce. The impact of electronic commerce (ecommerce, or EC) on procurement, shopping, business collaboration, and customer services as well as on delivery of various services is so dramatic that almost every organization is affected. In this paper, I will show how electronic reverse auctions (e-RAs) is very significant in the federal procurement process by saving money, time and maximizes supplier competition. Reverse auctions gained popularity with the emergence of Internet-based online auction tools. Today, reverse auctions are used by federal, state and private agencies to purchase raw materials, supplies and services. The Reverse Auction Process In the traditional auctions, also referred to as forward auctions, a seller offers a product that is demanded by several buyers who compete and bid up the price. The highest bidder wins and buys the product. In a reverse auction, it is the buyer who is in control of the process. The buyer is interested in an item offered by a number of sellers who compete and lower their price in order to get the deal. Unlike traditional auctions that occur at physical locations, reverse auctions are accessed online, through web browsers, via private software companies known as “market...
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...Ernest Johnson Explain why companies have struggled to integrate processes despite the fact that managers have been calling for greater cross-functional collaboration for almost 50 years. The authors of the text wrote that functional structures limit cooperation and impede creative thinking. 1 page 69 It takes a paradigm shift and I believe that the change has to be communicated in a way that each stakeholder understands the potential impact on them personally as well as the impact on their department. Explain the underlying idea behind systems thinking? Identify and describe two instances where systems thinking has led to either superior decision-making or to a unique business model. Dell revolutionized the computer industry with custom build computers based on customer requirements. Dell contracts out the manufacturing of their computers. Honda rethought the boundaries of their system to include suppliers as part of the team. They view their suppliers as we view departments. List the steps involved in systems analysis. Which step do you think is the most neglected? Why? The steps of systems analysis are: Establish Core Goal, Define System Boundaries, Determine Interrelationships, Determine Information Requirements, Perform Trade off analysis, consider system constraints and Make Decision. I think the most challenging of these steps is to establish a clear goal. Probably the most neglected step is performing trade off analysis. Because of functionally trained...
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...purchasing and supply topics for research proposal Quality Management Quality Management. Search for White Papers and Other Software Related to Quality Management. In today’s global market, providing quality products and services is essential for any manufacturer’s continued growth—but maintaining a competitive edge is not always easy. For success, quality awareness must begin at the conception of the product and continue throughout the various stages of its development. To improve in this area, many manufacturers are now adopting the total quality management (TQM) approach. CASH MANAGEMENT RESEARCH PROPOSAL SAMPLES: Quality Management Quality Management Source: 3i Infotech Document Type: White Paper Description: In today’s global market, providing quality products and services is essential for any manufacturer’s continued growth—but maintaining a competitive edge is not always easy. For success, quality awareness must begin at the conception of the product and continue throughout the various stages of its development. To improve in this area, many manufacturers are now adopting the total quality management 7/3/2007 1:15:00 PM Alfanar HR Management Alfanar IT, an information technology company operating in Saudi Arabia since 1995, introduces the alfanar human resources (HR) Management module for Microsoft Dynamics AX. This module enables the HR department staff, without any programming capability, to identify, capture, maintain, and adjust employee information required...
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...Butler Systems Butler Systems is a manufacturer of environmental control systems and power conditioning equipment. Butler is the world’s leading supplier of computer support systems and the largest supplier of precision air-conditioning and power protection systems. Butler sales exceed $1 billion. The HD-5 battery is the primary component for the EPS (emergency power supply) system. The vice president of operations is concerned about the low HD-5 battery inventory. There is currently a 20-day supply of batteries. A 90-day supply is the normal inventory level. Butler has not received a battery shipment in two months. Last week when the buyer discussed the problem with SDX, the battery supplier, it was revealed that the contract price would be doubled and that the current contract with Butler is now null and void. Questions: 1. As the VP of operations, what is your assessment of the battery shortage problem, and what actions would you take and why? 2. What is the buying organizations role in selecting and qualifying potential suppliers? Case 12: Hoosier Pride Construction In addition to the cyclic down turn in the construction industry HPC was facing a serious problem. The employee benefit costs have increased at approximately three times the rate of increases for wages alone (19 percent versus 6 percent yearly) from 2000 to 2001. In particular, the employee health insurance costs increased from $2,584 per employee per year in 2000 to $4,316 in 2001. The insurance premiums...
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...Case study: Internet auctions The Internet has opened up many opportunities for increasing consumer power, and nowhere has this been more apparent than in the proliferation of Internet auction sites. Sellers are able to post goods for sale on sites such as eBay or eBid, with or without a reserve price, and buyers are able to place their bids from (theoretically) anywhere in the world. The price rises as more people bid, until there is only one buyer left, who then buys the product at the final bid price. Buyers can pay by credit card through an escrow company (that holds the funds until the goods are delivered) or can make arrangements directly with the seller for payment. In recent years the process has moved a step further with the advent of reverse auctions. Firms such as Letsbuyit.com bring buyers together to bid for products. The philosophy is simple; rather than bidding against other purchasers, and forcing the price up, the reverse auction arranges for buyers to join together and force the price down. For example, a manufacturer may offer an LCD TV for £800. If, however, 100 people are prepared to place a single order, the price might drop to £600. If 200 people are prepared to buy, the price might drop to £500. The price paid to the supplier will be dictated by the number of buyers, so Letsbuyit.com begins by negotiating a series of steps at which the price will fall. The prices are posted on the website for a set period, but once the product is sold out it will not...
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...1 What is Business Process? A structured, measured set of activities designed to produce a specified output for a particular customer or market. It implies a strong emphasis on how work is done within an organization. 2 What is BPR? It is a fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical contemporary measures of performance, such as cost, quality, service and speed. BPR transfer the current process (ASIS) to an improved process (TOBE) 3 What is a BPR Modeling & Analysis Method? Language and procedure with underlying process concepts to build and analyze process models. Business process modeling: Development of representation of business process, representation captures the aspects of process that are key to understanding its functioning and performance. Business process analysis: Examination of structure and performance of business process, assessment of impact of various parameters. 4 How to deal with resistance to change? 4.1 Communication i Stakeholders need to understand (What, why, how) ii Ongoing two-way communication 4.2 Involvement i Saving money not employ expert ii Ask employee (What do you think?) (appropriate moments) 4.3 Training i Hard skill + Soft skill 4.4 Reward i Extrinsic reward + Intrinsic reward 5 El Sawy’s Approach 5.1 Operationalize process performance target 5.2 Define process boundaries 5.3 Identify key process issues 5.4 Understanding best practices and define initial...
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...Solutions Review Questions 1. In approximately 100 words, define the term “reserve price” and explain how the use of a reserve price can affect the progress and outcome of an auction. Answer: A reserve price is a minimum; even though the bid may start at a very low price, there will be no winner unless the bids reach a reserve price set by the seller. If the reserve is set too high, no one may win the auction. 2. Identify an industry (or a product within an industry) in which buyers would find reverse auctions to be a useful procurement tool. In about 300 words, explain why your chosen industry or product would be a good candidate for a reverse auction procurement process. Answer: One industry that may be considered is the construction industry where bidders are invited to offer value engineering, innovations, and alternate design ideas that could save money over the life cycle of a project. 3. In about 300 words, describe the services offered by an online auction escrow service. Name one advantage and one disadvantage of using this type of an escrow service. Answer: An escrow service will hold the buyer’s funds until the buyer has received the merchandise and is satisfied; this is primarily used for high ticket items. The advantage to the buyer is that they can be sure they are getting what they paid for in the auction. The disadvantage is that a buyer can be dissatisfied about almost anything and the seller must wait for a decision. 4. Some eBay users believe that the use of sniping...
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...* Table of Contents 1 Introduction 1 2 Elements of E-Procurement 1 2.1 Systems 1 2.1.1 ERP 1 2.1.1.1 The implementation process and life cycle 2 2.1.1.2 Key success factors (KSFs) 3 2.1.1.3 Project preparation 3 2.1.1.4 Technology selection 4 2.1.1.5 Implementation/ development: 5 2.1.2 EDI 5 2.2 Necessary Support Technologies 7 2.2.1 E-Catalogues 7 2.2.2 E-Auctions 8 2.2.3 Market Places 11 3 Strength and Weaknesses of Implementing E-Procurement 13 3.1 Strengths 13 3.2 Weaknesses 14 4 Critical Success Factors for the Implementation of E-Procurement 15 4.1 Supplier and contract management 16 4.2 End-user behavior and e-procurement business processes 16 4.3 Information and e-procurement infrastructure 17 5 Case Study 18 6 Future Outlook/ Conclusion 19 List of References II Introduction During the last decade and especially in the last couple of years, the internet has finally found its position in business operations. While the use of internet has been rather the exception than the norm, it is now becoming more and more common to streamline processes and eliminate wasteful processes through the use of the internet. This can especially be seen in the purchasing operations of many firms nowadays, as many companies see the importance of efficient procurement and change from slow and often expensive, paper-based orders to e-procurement. It seems as though this style of procurement can be of great advantage to every firm, but there are also drawbacks. The...
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...Casturn Systems (A) (B) Group Case #3 1. What went wrong with Casturn’s first two auction attempts? Casturn hired a consulting company that possibly didn’t have the best interest of Casturn as its core motivation. The consulting company was paid on POTENTIAL cost savings and identification instead of a results oriented contract. Due to this structure, it became about quantity of parts that can be included in the bid instead of identifying the top say twenty percent of parts that, if managed well, could have yielded both companies a lucrative cost savings in the resourcing effort. In addition, the consulting company exited the process after the initial stages giving no one accountability to carry the resourcing effort to fruition. Included in the initial effort were too wide a range of parts, simple commodities and technically complicated parts as well, this gave no focus to manage the effort effectively. In auction attempt ONE, Casturn decided to focus on castings and chose a platform for competitors to be able to see all bids submitted. What Casturn found was there was a lackluster response to driving these bids for what can only be speculated about. The incumbents felt very confident that they would not be losing the business and really had no incentive to bring their prices down as the bids of the other companies were overall higher and there was transparency to all of the bids. Also, there was a general consensus that Casturn was not very serious about uprooting...
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...PURCHASING PROCEDURES, E-PURCHASING, AND SYSTEMS CONTRACTING The purchasing department generates added value and profitability for the entire organization by communicating with suppliers to procure high-quality goods and services at the lowest cost and at the right time. This value is restricted by archaic and inefficient processes involving paper documents and time-consuming tasks. The E-Purchasing Solution automatically sends purchase orders, purchase requisition forms, etc… from SAP ensuring completion and timely approval of documents that are sent to your suppliers. You can easily track documents to verify they have effectively been sent ensuring that no order has been lost or misplaced. ERP FAX EMAIL Purchase order Purchase order copy Purchase order copy EMAIL Purchase department Production planning Accounting department Suppliers Purchase Manager Validation form by e-mail Automatic file Warehouse ERP FAX EMAIL Purchase order Purchase order copy Purchase order copy EMAIL Purchase department Production planning Accounting department Suppliers Purchase Manager Validation form by e-mail Automatic file Warehouse The Purchasing Policy The driving force behind any purchasing corporate policy considers the following objectives: 1. Spend corporate funds wisely. 2. Operate in a professional manner. 3. Purchase the right materials in the right quantities, at the right time and price, from the right source. 4. Practice the highest level of ethical standards...
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...Armingol B. Morales (Instructor) BIDDING is an offer (often competitive) of setting a price one is willing to pay for something or a demand that something be done. A price offer is called a bid. The term may be used in context of auctions, stock exchange, card games, or real estate. Bidding is used by various economic niche for determining the demand and hence the value of the article or property, in today's world of advance technology, Internet is one of the most favorite platforms for providing bidding facilities, it is the most natural way of determining the price of a commodity in a free market economy. Biddings are arranged by first disclosing the time and space location of the place where the bid is to be performed, so that more interested bidders may participate and the most "true" price of the commodity may come out, in terms of bidding on Internet the time frame for posting the bids may be a topic of interest. For some auction houses, bidding is meant to be fun and enjoyable, but remember that each bid you place enters you into a binding contract. All bids are active until the auction ends. Many similar terms that may use or may not use the similar concept have been evolved in the recent past in connection to bidding, such as reverse auction, social bidding, or many other game class ideas that promote them self as bidding. Bidding is also sometimes used as ethical gambling in which the prize money is not determined solely by luck but also by the total demand that the...
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...Impacts Learning Objectives Upon completion of this chapter, you will be able to: 1. Define e-marketplaces and list their components. 2. List the major types of electronic markets and describe their features. 3. Describe the types of intermediaries in EC and their roles. 4. Describe electronic catalogs, shopping carts, and search engines. 5. Describe the various types of auctions and list their characteristics. 6. Discuss the benefits, limitations, and impacts of auctions. 7. Describe bartering and negotiating online. 8. Define m-commerce and explain its role as a market mechanism. 9. Discuss liquidity, quality, and success factors in e-marketplaces. 10. Describe the economic impact of EC. 11. Discuss competition in the digital economy. 12. Describe the impact of e-marketplaces on organizations. Content How Raffles Hotel Is Conducting E-Commerce 0. 2.1 Electronic Marketplaces 0. 2.2 Types of Electronic Markets: From Storefronts to Portals 0. 2.3 Intermediation and Syndication in E-Commerce 0. 2.4 Electronic Catalogs and Other Market Mechanisms 0. 2.5 Auctions as an EC Market Mechanism 0. 2.6 Bartering and Negotiating Online 0. 2.7 E-Commerce in the Wireless Environment: M-Commerce 0. 2.8 Issues in E-Markets: Liquidity, Quality, and Success Factors 0. 2.9 Economics of E-Marketplaces 0. 2.10 Competition in the Digital Economy 0. 2.11 Impacts of E-Markets on Business Processes and Organizations 0. 2.12 E-Reality Managerial Issues ...
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...results from nearby gas stations right on the dashboard.”1 It sounds far-fetched. But dynamic pricing — where prices respond to supply and demand pressures in real time or near-real time — is making inroads in many different sectors, including apparel, automobiles, consumer electronics, personal services (such as haircuts), telecommunications and second-hand goods. The advent of the Internet led to cost transparency, decreased search costs and ease of price comparison. Some observers concluded that as a result, prices would decrease and equalize across different channels, and that fixed prices would continue to be the norm.2 However, price dispersion continues to be widespread and dynamic pricing is entering new sectors. EBay Inc. used auctions to sell more than $20 billion worth of goods in 2005. Ford Motor Co. sold more than $50 billion worth of automobiles in North America with demand-based DP in 2003, exceeding profit targets by $1 billion. Fixed prices are, after all, a relatively recent phenomenon — a product of mass manufacturing that came about after the Industrial Revolution. Before that event, fixed prices were the exception; DP was the norm, with both buyer and seller able to benefit in many DP transactions. However, apart from airlines and hotels, which employ DP routinely,...
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...LAB PROJECT REPORT LAW OF TENDERS AND AUCTIONS PGPM 2010-12 TERM 1 TABLE OF CONTENTS 1. Auction and tender.……………………………………………………………………………………………………………….......3 2. Auction………………...……………………………………………………………………………………………………………….......3 2.1 Legal Aspect as per The Sale of Goods Act, 1930...............................................................3 2.1.1 Legal Rules Regarding Auction.............................................................................3 2.2 Legal Aspect as per The Indian Contract t, 1872................................................................4 2.3 Auction Terminologies…………………………………….................................................................6 3. Tender………………..………………………………………………………………………………………………………………….......6 3.1 Legal Aspect as per The Indian Contract t, 1872................................................................6 3.1.1 Acceptance and withdrawal of tenders...............................................................6 3.1.2 No Obligation to Accept Lowest Tender..............................................................7 3.2 Tenders Terminology……………….………….………..................................................................8 3. Judicial Pronouncements and Analysis………………………………...........................................................9 3.1 Auction…………..…………………………………..............................
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