One of the nice things about living in medieval Europe, assuming you were a noble, was the simplicity of procuring what was needed for the kingdom. From the noble's perspective, the process of acquiring items meant little more than ordering the peasants and serfs to do it. Need a new cottage? Make the peasants build it. Pork chops for lunch? The serfs will see to it. None of that cumbersome democracy ever got in the way.

For those of us living under the yoke of freedom, however, transparency in government means that procurement -- what is purchased, how it's purchased and for how much -- is always under scrutiny. It has always been a thorny, paper-rich procedure for government. The fact that procurement professionals exist attests to the fact that when democratic governments buy anything, it is generally a complicated affair.

Until a few years ago, little had changed from the days of writing purchase orders with a feather pen by candlelight. Every purchase left a paper trail of often formidable size and uncertain expense. Finally in the 1990s came the idea of e-procurement -- a process wherein government acquires goods electronically. Since everyone loves computers and they solve so many problems, e-procurement was an overnight sensation ... well, not exactly.

But a number of state and local governments are starting to take a second look at e-procurement. And others -- such as Virginia, North Carolina and San Diego County, Calif. -- continue to build on the successes of taking their procurement process online, serving as models to others.

E-Procurement Redux

Like many Web technologies that emerged in the late 1990s, e-procurement was ahead of its time, but not by much. State governments were investigating or even piloting e-procurement systems when the dot-com bubble burst, sending most running back to traditional purchasing methods. But in recent months, e-procurement has experienced a second coming, which is partially attributed to a new approach to the procurement process known as strategic sourcing.

Strategic sourcing can be defined as a methodical, precise strategy designed to identify the best products and services for the best value while improving levels of service quality. Most experts agree that strategic sourcing and e-procurement complement each other.

Gary Lambert is a leading authority on e-procurement and strategic sourcing. As a former state procurement official and current vice president of consulting at procurement solutions provider CGI-AMS, Lambert is well versed in the potential of strategic sourcing and e-procurement.

"I look at strategic sourcing as an approach and a discipline to the procurement process," Lambert explained. "It's a tool that's used to actually make a determination about the best way to procure goods and services for government. It's really a discipline that helps you make a decision about the most efficient way to actually do that procurement, and how it will provide you with the best value at the end of the day."

Strategic sourcing is one of those technocratic terms that seems complicated and pretentious, which is why some prefer to call it "spend management." As Lambert said, it's really little more than designing a process in which a government can purchase the best goods and services for the best price. And e-procurement is merely the purchasing process done electronically -- eliminating complexity, cutting cost and improving financial management.

Sounds simple, so why isn't everyone doing it yet?

"I don't think there's any question that it's proven technology," said J.D. Williams, director of state and local government for Oracle. "You're down on what you're not up on. Those who are up on it, through their private business experience, or what they know about other states, will see the benefits of this," he said. "I think there will be a lot of this occurring after

Chad Vander Veen  | 

Chad Vander Veen is the former editor of FutureStructure.