Access to business opportunities – a

stimulant growth

Introduction to the seda National Procurement Programme

Prepared by: Francois Naudé

For: South Africa SMME Conference

Date: 19 October 2006

A TSS Group Company

Background

Developing the base of suppliers contributes to an increasingly successful society

Access to opportunities – one of key pillars of enterprise development

The ability of large procurement budgets to influence this process is generally accepted but not implemented

Challenges

Incoherent approach to solutions Fragmented initiatives to address on problem

Hesitation to engage emerging business due to complexities Large opportunities published - little opportunity for emerging

business sector

Inefficiencies Emerging businesses often not geared for requirements Lack of capacity and quality

Greed Traditional/larger business attempt to tap into social responsibility

initiatives

Responsibility definition Not the role of SC operatives to develop economy Make it easy for them to play this role

• Standardise registration & accreditation• Regular maintenance of information• Guide the formalisation of business• Capacity building

• Standardise registration & accreditation• Regular maintenance of information• Guide the formalisation of business• Capacity building

Information

Information

AutomationAutomation

Financial

Support

Financial

Support

• Integrate supplier profiles into decision making• Track progress against targets• Supplier feedback

• Integrate supplier profiles into decision making• Track progress against targets• Supplier feedback

• Shorter payment cycles• Trade Finance • Shorter payment cycles• Trade Finance

Value levers

History of collaboration

Partners: Ntsika Namac RED Door Tender Club

Challenges Little/No knowledge about potential

suppliers Lack of infrastructure Personnel turnaround Complex searches vs targeted filtering

Model for success in inter-governmental collaboration:

seda National Procurement Programme

A TSS Group Company

Objectives

Increased participation of small enterprises in tendering and supplying the public and private sectors with competitive goods and services

Increased opportunities on the system with a view to serve a large number of small enterprises.

Scope

34 Seda Branches 1 000 Suppliers Supplier Registration

Supplier List Verified Supplier Database

RFQ & Quotation transactions Tender Notification

Tender Bulletin

Internet

Small branch PC

Branch Server

Branch Server Branches connect to

National Procurement

Portal via Internet

Community of Seda branch gets access to Internet in branch and assistance from branch staff

E-mail WWWPress &

Tender Bulletins

TradeWorld gathers tender info from various sources

National Procurement Portal

RFQ Transactions

Internet

Internet

Small branch PC

Branch Server

Branch Server

National Procurement Portal

Branches connect to National Procurement Portal via Internet

Community of Seda branch gets access to Internet in branch and assistance from branch staff

Procurement organisations use ERP system or

SourceCentre to generate RFQ or to award winning

quotation

seda Supplier Database

Critical mass

Current Volumes: Average 2 666 RFQ’s per supplier p.a. Average 1 248 Tender Notification’s per supplier p.a.

Focus on smaller transactions Collaborate with Seda to bring more buyers to

contribute RFQ’s to platform

Status

National Procurement Portal developed Training of seda branch network in progress Integrated into a number of large procurement

organisations Launched at NMB BEE Expo earlier this month

Registration of suppliers taking place as we speak Supplier training Increase procurement opportunities processed

Ready to pull the trigger:

Any Questions …

??

Implementation

Content is key Complete supplier registrations/accreditation Share supplier information

Adoption of procurement technology Adopt procurement best practice Integrate content with technology Set indicators & targets

Measure and adjust This should ensure the participation of smaller

enterprises – driving the broad base

Supplier interaction

Discover

Explore

Transact

Develop

10 000’s

1 000’s

100’s

10’sHigh level of collaboration and planningJoint capacity development

Automation of communication & processesPerformance measurement

Deep information on supplier profile and capability – limited interaction

High level information on Product/Service and geography

Supplier Base

Suppliers can migrate up the path from initial discovery to collaborative planning and development.

Inverse relationship

Measurement Feedback

Discover

Explore

Transact

Develop

Interrogation

CommunicationAutomation

Search

Supplier BaseFunctional

requirements& Information depth

The various levels of supplier interaction shows an inverse relationship between the number of suppliers at each level and the richness of functionality and data required.

Data store

Discover

Explore

Transact

Develop

10 000’s

1 000’s

100’s

10’sData warehouse/BI tool

ERP Vendor Master

Verification database

Directory

Supplier Base

The ERP vendor master is not the best place to store all supplier information. Segmenting the supplier base allows for the right functionality and depth of information for the level of the relationship.

Shared Supplier Database

Partners: Western Cape Provincial Government; Western Cape Parliament; City of Cape Town; and Boland District Municipality. PPECB WC Gambling & Racing Board

Shorten registration process

Save on taxpayer expense

Acceptance from suppliers

Close interaction with Red Door centres

Model for success in inter-governmental collaboration:

Future initiatives

BBBEE Balanced scorecard to be used to measure progress in optimising BEE;Further consolidation of supplier databases;Payment mechanisms to support SMME interaction; Supplier development automation.

The base has been established. Next steps need to take it to another level:

Any Questions …

?