Study On E-procurement BPR In LY Corporation

With the dramatic development of the information and transportation technology, globalization of economy and integration of market speed up unprecedentedly, competition in the market are becoming more throat-cutting and customers are becoming more demanding on quality, speed and cost of the goods and service offered by suppliers. With its subversive fundamental rethinking and re-designation of organization, Business Process Re-engineering as a new management philosophy has attracted a lot of excellent companies to join the revolution. Procurement process is the main part of the business process, procurement activity is the starting point of production activities and a major part of corporate capital outflow, enhancing procurement management, improving procurement's efficiency, lowering raw material costs have been considered as the third profit source except reducing the consumption of raw materials and improving the return on sales.through re-engineering business process of procurement department company can reduce procurement costs, accelerate speed of delivery, add value for customers, and enhance their core competitiveness.This paper begins with illustrating the overview of BRP and Modern procurement theory, then according the actual situation of procurement department in LY company, then the procurement business process is clearly analyzed,the main existing problem and its cause are presented. On this basis, E-procurement process re-engineering solution focusing on meeting customer's needs is proposed that different re-engineered business process including procurement planning, price determination and contracting,contract enforcement and bleach of contract and supplier management will be adopted according to different classified materials which is based on that all commodities,components, products and services according to supply risk and potential profit impact of each are classified. Steps to ensure the smooth implementation process are proposed and solutions to solve the potential problem produced in the process of implementation of new re-engineered procurement process are provided. Finally, new business process appraisal and evaluation mechanism is established, one conclusions is made through comparing the analysis of indicator between before and after the implementation of E-procurement BPR:shorter procurement cycle time, higher quality of materials,lower cost and faster service are achieved through E-procurement re-engineering business process in LY corp.