Operational example of e-procurement system (Korea )

1. Operational example of e-procurement system (Korea)

2. Contents I. Background of KONEPS II. Services of KONEPS III. Interface services of KONEPS Agenda IV. Contributions to Public Procurement IV. KONEPS in the world

4. Objectives of KONEPS Issues before KONEPS Manual process based on paper

5. Objectives of KONEPS Transparency Via the real time information release Corruption-Free Via reduced direct contact between officials and suppliers

6. Development of KONEPS Preparation Period (1997-2001) Electronic Document Exchange System (1997) Online Shopping Mall System (1998) e-Tendering System (2000) e-Guarantee and e-Payment System (2001) Gov’t-wide Expansion (2002-2004) As one of 11 e-government projects, KONEPS was developed for the use of the whole public organizations (2002), Disaster Recover System(2003), Data Warehouse, CRM(2004)

7. Services of KONEPS

8. KONEPS Structure The on-line procurement system which integrated whole processes are processed automatically. And this system is composed of 4 major modules – e-bidding, e-contracting, e-purchasing and e-payment.

9. MOSF MOEST MOPAS Integrated Notice KONEPS Portal Classification KFTC Public Organizations. KAMCO • Search • Classification • Identifier • Contract Info. CA Surety supplier E-Catalog Unit Price Contract Suppliers Classification Management Product Search Association Best Product MAS Decision Support Product Management Product Info Search PPS contracting officials Info Analyst KONEPS System Architecture Korea ON-line e-Procurement System External User External Systems e-Procurement Process System Integrated Notice Awarding Contract Management Procurement Request Contracting • KONEPS info • MY KONEPS • Survey • Contract Writing • Contract reviewing • Contract Making • Delivery management • Contract Modification • Payment Request • Payment • Bidding/Negotiation • Quotation Comparison • Prequalification • Cost Calculation • Contract Method Decision • Delivery Request • Procurement request Business Info Certificate Internet Support Service System • Registration • Bid Notice • Opening Result • Search Business Performance ID/PW Supplier Performance User Management e-Surety e-Payment • User Registration • Unfair Businesses • Report • Individual user • Management • Past Performance • Technician Info. • PQ, Eligibility Test Result Search • Statistics Management • Payment List • Monetary Transfer • Transfer Result • Bill Management Closed Network • Receipt of Guarantee • Guarantee management Web Service Catalog Government Network Document distribution /External Linkage • Document circulation/Security Management • Circulation System Management • Info Linkage Management Price Info • e-Document Form • Management Disk Info Linkage Info Linkage Info Linkage Info Linkage Internal User Intranet Data Linkage Internal Linkage PPS Integrated System General Administration System Government Product Management Portal e-Shopping Mall Intranet Stockpiling Construction Foreign Procurement EDMS Homepage Domestic Procurement Office Supplies Q&A

10. Credit rating agencies Notification to candidates On-line Biding Opening Supplier Buyer Qualifying Evaluation System Eligible Test Preparing Materials Missing the Adverse Material Material Submission KONEPS Association Patent office Product Certification Authority

11. Shopping Mall System

12. 한국 수자원공사 한국 가스공사 인천공항 국제공사 한국마사회 한국국제 협력단 한국철도 시설공단 한국 도로공사 한국수력 원자력 한국철도공사 방위 산업청 한국전기 연구원 한국 전력공사 대한 지적공사 대한 주택공사 한국지역 난방공사 한국 석유공사 Approve Request Buyer supplier 교육 재정 지방 재정 국가 재정 우정사업본부 Past Contract Performance I/f system Financial System Other e-procurement system (20) Payment Data Contract Data KONEPS Total Contract Information DB Contract Performance Issue System Search the contract Information Contract performance Issue

13. Supplier Supplier examiner Buyer On-Line Proposal Evaluation System • Convenience for Supplier • Convenience for Examiner • Reduce of examiner’s fee Proposal Upload Apply DRM KONEPS Video conference • submit proposal directly ? • examiner’s off-line assessment ? • Overcharge of examiner’s fee ? Result Allow access examinerDB Access Certification On-Line Evaluation

14. KONEPS Supplier Wi-Fi Smart phone service • Ubiquitous e-government implementation • Increased Convenience • Customer satisfaction increased Smart Phone Bidding Service Result of Bid Opening Bluetooth Certificates Security token Mobile Bidding System Gateway server KONEPS System web web Web 3G PKI S/W AccessAuthentication XML Conversion Interface WAS WAS DB Server

15. Provide objective indicator to catch illegal symptom by public certification Data Analysis operator expert audit Electronic Illegal Bids Analysis System Illegal Electronic Bids Analysis System Detect symptom User authority management Additional analysis Illegal state indicator search with Various method Conform result Access control create data for illegal state Request investigation statistics and enterprise data Judicial authorities KONEPS Linkage User connect record Individual information IP, certification Mac Address Cyber investigate unit Fair trade Bidding/opening info. Illegal e-bidding through rental certificates

16. Interface Services of KONEPS

17. Development Background Customer-Oriented Web services improvement of relative business and efficiency Following international standard Sharing process and information Different environment • Connect with • organization & enterprise which have different environment • Sharing information and process through web service based connectivity • apply ebXML, Web Service, XML and international standard relative to security

18. SOAP SOAP SOAP SOAP XML XML XML XML KONEPS Related association C Related association B Related association A Standard API Web Service Standard API Client System Standard API Client System Standard API Client System KONEPS Standard API Server System WEB • Provides linkage client API thru the most efficient method for the linkage • of KONEPS to the institute which has different operation environment and • platform. • Enables sharing KONEPS process and information via web-based linkage. • Provide the communication and security architecture which complies with the international standard. Standard API Web Service

19. UDDI 3.0.1 ebXML TRP 2.O XMLENC XPATH 1.0 WSDL 2.O XML 1.0 XMLDSIG SOAP 1.1 XSLT 1.0 Registry & Repository XML Schema1.0 CC PKCS SOAP with Attachment Standards of KONEPS API • Different Standards Used in KONEPS Security Standards e-Document Standards Messaging Structure Standards Information Provision Service Standards Protocol Standard (HTTP)

20. Interface Services • Connected with 100 external organizations

21. Interface Service – Finance System

23. Transparent Public Procurement Accomplished

24. Promotion of Private e-Commerce Development

25. Enhancing Procurement Capabilities

26. E-procurement in the world

27. System implementation and Feasibility analysis underway KONEPS Exported Overseas Mongolia Russia Armenia Iran Senegal Indonesia Uzbekistan Peru Tunisia Jamaica Vietnam Costa Rica

28. KONEPS Exported Overseas Vietnam • e-GP Pilot System • Operated since Jul. 2010 Costa Rica • MER-LINK • Commenced Full Service in Dec. 2010 Mongolia • Mongolian e-GP System • Implementation by Aug. 2011

29. THANK YOU!

30. Obstacles & Lessons Learned

31. Coping with Obstacles in Establishing KONEPS

32. Coping with Obstacles in Establishing KONEPS

33. Coping with Obstacles in Establishing KONEPS

34. Lessons learned • Government leadership and commitment • Integrate and share all information about government procurement • Make a single e-procurement system for all public organizations • Standardize procurement process and electronic document (XML) with digital signature • Take the step-by-step approach from integrated bid information and e-bidding • Need to make clear rules and regulations according to the reforming the process

35. 한국 수자원공사 한국 가스공사 인천공항 국제공사 한국마사회 한국국제 협력단 한국철도 시설공단 한국 도로공사 한국수력 원자력 한국철도공사 방위 산업청 한국전기 연구원 한국 전력공사 대한 지적공사 대한 주택공사 한국지역 난방공사 한국 석유공사 Approve Request Buyer supplier 교육 재정 지방 재정 국가 재정 우정사업본부 Contract Performance Issue System Financial System Other e-procurement system (20) Payment Data Contract Data KONEPS Total Contract Information DB Contract Performance Issue System Search the contract Information Contract performance Issue

36. Product sales screen on KONEPS Connect a standard ad screen KONEPS supplier Advertising Portal Attempted introduction of banner ads • Revenue by Banner advertising on KONEPS Portal Considering no website supplier, connect the standard ad screen Advertising costs apply differential depending by Banner ads location Negative views about Profitable business of Government

37. ITSM System Request handle procedure of the ITSM AP Management and Development System Management and Inspection Call Center Service Desk • Entrusted System • Development Group • (Samsung SDS) • Handles user request • Database management • Entrusted System • Development Group • (Samsung SDS) • Analyze request and present solution • Request for deployment • after development • Entrusted System • Operation Group (Sun Micro Systems) • System Deployment • Manage DB history and log Development Request Modification Request • Information Request • Inquiries • Irregularity Report • Update Request Request of examination and approval Request of examination and approval Request of examination and approval • Internal Agent • (Service Division) • - Examines and approves • requests • - Verify final results • Internal Agent • (Development Division) • - Inspection and approval of • modification request • - Test deployed result • Internal Agent • (System Division) • - Check result after • modification • - Inspection of DB history • and log Result Verification Result Report • Mutual check between internal/external and functional organization • Constant monitoring using real-time log update (Log-Saver, Read-only CD) and inspection program

38. Proportion Private Area :660㎡, Agent seats :54 Superintendent, Meeting Room, staff lounge etc. Operation Direct Operating by PPS Headcount Administrators: Customer Manager(1), Workgroup Leaders(5), Agents: 46 Call Center System

39. Key Performance Indicator Key Performance Indicator KPI Call Center System Key Performance Indicator Customer Response Percentage of Customer Response 96.2% ↑ Service Level Response 80% of calls under 20 sec of wait Call Solving At First Average 70% ↑ Customer Satisfaction 2 times per Year ↑

40. Call Center Switchboard Call Center Middleware IP-PBX 콜센터 교환기 CTI 콜센터미들웨어 IVR 자동응답 C-Rec Voice 녹취시스템 Consultation APP. 상담운영관리 Auto-answer Service Real timerecording System AnySupport 원격지원시스템 Remote Assistance System Agent Convenient Features receiptand question history management Call Center System Major Equipment

41. Contributions to Development of SMEs 2010 31 97.2 32 191,258 98.8% 193,663 311,896 97.2 4,384 321,059 4,467

42. KONEPS Management

43. Let’s Think! • Convenient ways to use KONEPS ? • How to operate KONEPS ? • Problems during KONEPS operation ?

44. KONEPS Management • Efficient Operation ? • Stable Operation ? • High level Operation ? • Outsourcing by Professional IT supplier • 3-Years Long-term contract • SLA • ITSM

45. New Service Support Services Version Control Outsourcing Function Implement and Additional Development • Impact Analysis by Legal, policies change • Application Function Improvements, Test • Efficient operation Application Operation Service Optimization • Error Correction, Simple Function Change etc. Maintenance activities • Application Optimization activities • ApplicationEnvironmental Modification • Core business focus • Cost savings Education Support and Project Management • Quality Management / SLA Management • Contract Management • Education Support for KONEPS • Workforce Management / Partner Management • quality service Application version Control etc. • Business consultation and Administrative processing support • performance management • Product Management • Call Center team support

46. Long-term Contract • Stable Operation • Phased improvement of service quality • Short-term Contract (1 year) • - Frequent replacement of the operating personnel • -Can not utilize the accumulated know-how • Long-term Contract (3 Year) • - Stability of the operating personnel • - Annual Service Improvement ※ Generalized trend of long-term contract in the private (3~5 years) ※ Since 2005, long-term contract ( KONEPS)

47. SLA create Catalogue SPI, SLA Draft Negotiation Level review Conclusion Sustainable management Review/Improvement SLA review Monitoring Report Review SLM Process review SLA (Service Level Agreement) • High Level Operation • Minimize disability and Identify obstacles in advance SLA (Service Level Agreement) SLM(Service Level Management) Planning Level Mgt Plan Initial Run

48. ITSM System • Standardized Multilevel Approval Procedure • Adoption of the ITIL 2.0 procedure (’05) • ITIL (Information Technology Infrastructure Library) • Collection of international standards used by the leading IT service companies • Successful implementation of the ITIL • First public institution to receive ISO20000, an international certificate for ITIL implementation (Oct. 2005) • Establishment of Automatic ITSM (’06) • Development of Automatic IT Service Management System in accordance with ITIL standards • Increased speed and stability of system updates

49. Problems • After the initial development, occurs doubts about security of bid and Transparency of System • ▶ Held the Presentation to suppliers and media etc. • Decrypting error occurs when bid opened, Attachments are not opened • ▶ specify processing method When user's PC error occurred • Server down due to user congestion • ▶ Establish disorder treatment guidelines • ▶ Auto-delay announcement processed • Bid Submission time Error • ▶ Apply Certified Accredited hours • Collusion with a certificate Rentals • ▶ Personal certificate identification, Report & Awards , • Fingerprint Recognition

50. Revenue Model Thru KONEPS