E-procurement in the United Nations

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E-procurement in theUnited Nations: influences,

issues and impactHelen Walker and Christine Harland

Centre for Research in Strategic Purchasing and Supply,University of Bath School of Management, Bath, UK

Abstract

Purpose – The purpose of this paper is to examine the factors influencing e-procurement adoption inthe United Nations (UN) system of organizations are examined.

Design/methodology/approach – This paper reports on an extended multi-method case study of e-procurement in the UN. A three stage methodology is adopted – a questionnaire survey of UNorganizations, case studies of e-procurement issues in three UN organizations, and an interactiveworkshop with the heads of purchasing of UN organizations.

Findings – The paper finds that e-procurement is being used in the UN for transactions of routine,non-strategic purchases. UN development agencies are more likely to adopt e-procurement thanhumanitarian aid agencies as their operations are more predictable. The intention of the majority of UN organizations to adopt e-procurement within three years has been reversed following theworkshop, which revealed that adoption of e-procurement would run counter to UN policies of supporting less developed nations, regions and organizations. A more cautious, “wait and see”approach has been taken rather than to unilaterally promote e-procurement across the UN system.

Research limitations/implications – This research focuses on the UN, yet could haveimplications for other complex systems of organizations such as the public sector, or multinationalcompanies considering implementing e-procurement with suppliers in developing countries.

Practical implications – E-procurement needs to be considered in the context of other procurementpolicy objectives. What may be good e-procurement practice in a profit-making firm may be viewed ascompeting with broader policy objectives of not-for-profit organizations. The digital divide is a salientcontextual factor for the UN, and brings about unforeseen issues regarding e-procurement adoptionwhich may have resonance for other organisations.

Originality/value – Much research on e-procurement has been conducted in the private sector andthis paper contributes to the small but growing number of studies of e-procurement in the context of the public and not-for-profit sectors by studying e-procurement in the UN.

Keywords International organizations, Electronic commerce, Procurement

Paper type Research paper

IntroductionOrganizations are increasingly doing e-business using information and communicationtechnologies and the internet. This study explores the uptake of a particular formof e-business, that of e-procurement. E-procurement has been defined as the use of information technologies to facilitate business-to-business (B2B) purchase transactions

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/0144-3577.htm

The authors would like to thank the UN IAPWG for commissioning the research, UNDP/IAPSOfor facilitating access to case organizations, Marcus Simmons for his contribution to the research,and Steve Brammer for his comments on earlier drafts of the paper.

E-procurementin the United

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Received 7 February 2007Revised 21 March 2008,

3 May 2008Accepted 13 May 2008

International Journal of Operations &Production Management

Vol. 28 No. 9, 2008pp. 831-857

q Emerald Group Publishing Limited0144-3577

DOI 10.1108/01443570810895276



for materials and services (Wu et al., 2007). The study is conducted in the UnitedNations (UN), and investigates the issues, influences and impacts associated withe-procurement adoption in this setting.

The UN was established in 1945 by 51 countries committed to preserving peace

through international cooperation and collective security. Recently, nearly every nationin the world belongs to the UN, with membership now at 189 countries. The UN systemof organizations covers a wide variety of organizational units with different institutionaland functional structures. The UN is not an organization but a complex confederalnetwork of highly heterogeneous organizations. The total UN procurement spend isdifficult to estimate as the UN is made up of so many organizations. However, there areindications that UN procurement spend has risen in recent years. The value of purchaseorders handled by the UN Procurement Division, just one of many procurement routes inthe UN, has risen from $309.46 million in 1997 to $1,991.64 million in 2006 (UNProcurement Division, 2008b). A further example is the UN Development Programme(UNDP) which operates on the ground in 166 countries. Its annual programme deliveryhas been growing steadily since 2000 and reached $4.3 billion in 2006, of which$2.5 billion were spent for goods and services.

This study aims to investigate the influences, issues and impacts of e-procurementadoption in the UN, and to consider how complex policy objectives and e-procurementpan out in an international agency context. An extended multi-method case study isconducted, with a three stage methodology – a questionnaire survey of UNorganizations, case studies of e-procurement issues in three UN organizations, and aninteractive workshop with the heads of procurement of UN organizations. The studyseeks answers to the following research questions regarding e-procurement in the UN:

RQ1. How do UN organizations currently use and plan to use e-procurement?

RQ2. Which factors affect the adoption of e-procurement in UN organizations?

RQ3. How does adoption of e-procurement across the UN affect policy issues?

This study makes several contributions. First, the extant literature on e-procurementhas focused mainly on large economies and technology-oriented industries (Tatsis et al.,2006). Such large economies have major differences in economic, technologicaland social terms compared to newly industrialized and developing countries. In astructured literature review of e-procurement research, just 13 per cent of articlespublished on e-procurement since 1997 were conducted in the public sector (Schoenherrand Tummala, 2007). There has been little investigation of e-procurement outside of US and European private sector manufacturing settings. What are we to make of e-procurement in different contexts and for different sorts of organizations? This studyconsiders e-procurement in a different context to the majority of e-procurement articles,

by investigating e-procurement in the context of international agencies.Second, much of the work in international operations management research has

been motivated by a desire to provide firms with an economic benefit (Prasad andBabbar, 2000). Prasad and Babbar (2000) suggest similar research could be directed atnon-profit, governmental and international agencies with social measures. The UN isconcerned with achieving value for money in the way it procures goods and services,but has other policy objectives as well. What may be good practice in a profit-makingfirm may not be so clearly applicable for not-for-profit and public sector organizations.

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This research explores how e-procurement interacts with the more complex policysetting of the UN.

Third, the research is relevant to procurement practice, incorporating the UN policyresponse to e-procurement. The UN can be viewed as a leader of policy direction

internationally, and the study gives an insight into how heads of purchasing in the UNbalance competing procurement policy objectives. The findings may have salience inthe public, not-for-profit and voluntary sectors, where procurement is not onlyexpected to achieve value for money, but also is increasingly used as a lever to achievesocial and economic reform. The findings may also provide insights for private sectorfirms and multinational corporations keen to demonstrate corporate socialresponsibility in their purchasing and supply policies and practices.

This paper is structured as follows. First, the research context of the UN isdescribed, and how purchasing and supply is organized amongst the agencies. Next, aliterature review is presented that considers current use and benefits of e-procurement,and identifies factors influencing e-adoption in organizations. Next, the literaturereview turns to the digital divide, which is the differential extent to which rich and poorcountries benefit from various forms of information technology. The digital divide isan important contextual factor influencing e-procurement adoption in the UN.Subsequently, the methodology is described. Findings from a questionnaire survey,in depth case studies and an interactive workshop are provided. Conclusions are drawnthat are relevant to not-for-profit organizations and multinational companies withstrong corporate social responsibility policies.

The United NationsThe “UN System of Organizations” covers a wide variety of organizational units(centres, agencies, organizations, commissions, programmes, etc.) with differentinstitutional and functional structures. The principal bodies and subsidiaries of the UN

Secretariat are included under the regular budget of the UN, as authorized by theGeneral Assembly. Other agencies of the UN system, however, have their own regularbudgets or are financed solely from voluntary contributions.

The organizations within the UN system also vary considerably both in size and asregards their activities. Most organizations were established about the time when theUN itself came into being, but some are considerably older. Member bodies of the UN reporting annually to the General Assembly include, amongst others, theUN Secretariat, the UN Children’s Fund, the UN Conference on Trade andDevelopment, the UNDP, the World Food Programme, and the UN HighCommission for Refugees.

The specialized agencies, a term first used in the UN Charter which provides forinternational action to promote economic and social progress, report to the Economic

and Social Council. These specialized agencies work in the economic, social, scientificand technical fields and possess their own legislative and executive bodies, their ownsecretariats and their own budgets. These include, amongst others, the InternationalLabour Organization (ILO), the Food and Agriculture Organization of the UN, the UNEducational, Scientific & Cultural Organization, the World Health Organization(WHO), the World Bank Group, the International Monetary Fund, the InternationalTelecommunication Union, the International Fund for Agricultural Development,and the UN Industrial Development Organization.


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Under the authority of the Economic and Social Council are the Regional Commissions,whose aims are to assist in the economic andsocial development of theirrespective regionsand to strengthen economic relations of the countries in each region, both amongthemselvesand with theother countries of theworld. Theseare the Economic Commission

for Africa (Addis Ababa), Economic and Social Commission for Asia and the Pacific(Bangkok), Economic Commission for Europe (Geneva), Economic Commission for LatinAmerica and the Caribbean (Santiago) and Economic and Social Commission for WesternAsia (Beirut).

Although not formally part of the UN system, the regional development banks workclosely with UN organizations. These include the African Development Bank inAbidjan, the Asian Development Bank in Manila, the Caribbean Development Bankin Barbados and the Inter-American Development Bank in Washington, DC.

The UN Organizational Chart (www.un.org/aboutun/unchart.pdf) gives a picture of the extensive interlocking nature of the UN system of organizations.

Purchasing and supply in the UN Each of the larger agencies has its own procurement entity, to procure goods andservices specific to its mandate and operations. There is also a Procurement Division forthe UN Secretariat, and for Peace-Keeping Missions. The Inter-Agency ProcurementServices Office (IAPSO) of the UNDP serves as a focal point for the UN system onprocurement issues. It promotes inter-agency cooperation and coordination throughresearch and development activities related to procurement; supports the internationalbusiness community with information on UN business opportunities and providesprocurement services for development assistance and relief operations, upon request.IAPSO serves a clientele ranging from UNDP and other UN agencies to InternationalFinance Institutions and their Borrowers, Non-Government Organizations and othergovernmental organizations qualifying as partners in development aid.

Many UN agencies have delegated authority to their respective country offices toundertake procurement up to a certain financial limit, varyingby agency, from US$5,000up to 100,000. Local procurement by peacekeeping missions is authorized up toUS$200,000 for the larger missions. As developing countries become more self-reliant inmanaging their own technical cooperation, National Execution of projects andprogrammes increases, including procurement of necessary goods and services.

The Inter Agency Procurement Working Group (IAPWG) consists of heads of purchasing from across UN organizations, and meets annually to further procurementissues across the UN. The UN system operates on budgets funded by its members.Each agency has a separate budget approved by its respective supervisory board.Each UN organization has adopted common guidelines for procurement, which weredeveloped by the IAPWG. In practice, however, procedures vary widely among

agencies, depending on operational requirements. While for all UN organizations themajor emphasis is the achievement of best value for money through a transparentprocurement process, various agencies have differing procurement value thresholdsand approval procedures, particularly for contract values under US$100,000.

Literature reviewThis review seeks to identify themes in the literature relating to e-procurement, with theaim of illuminating the possible issues influencing e-procurement adoption in the UN.

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It starts by considering literature on e-procurement and its current use and benefits.Next, in seeking to explain differences in e-procurement adoption betweenorganizations, several factors are identified in the literature. Organizational,readiness, supply, strategic and policy factors relating to e-procurement adoption are

identified. The literature review then turns to a consideration of the digital divide,a salient contextual factor influencing the adoption of e-procurement in the UN.

E-procurementInformation and communication technologies are changing the way organizations dobusiness, particularly the adoption of e-business and e-commerce. The scope of e-business includes information exchange, commercial transactions and knowledgesharing between organizations (Croom, 2005), whereas e-commerce focuses only oncommercial transactions (Cullen and Webster, 2007). Some of the technologiesassociated with e-commerce include websites, e-mail, extranets, intranets andelectronic data interchange (EDI) (Mclvor and Humphreys, 2004).

Definitions of e-procurement vary across literature in the field. E-procurement hasbeen defined as the use of information technologies to facilitate B2B purchasetransactions for materials and services (Wu et al., 2007). Different forms of technologyare appropriate for different procurement activities; six forms of e-procurement havebeen classified (de Boer et al., 2002), including e-ordering/e-Maintenance RepairOperate (MRO), web-based enterprise resource planning (ERP), e-sourcing, e-tendering,e-reverse auctioning/e-auctioning and e-informing.

Other writers have classified e-procurement into three broad types – transactionmanagement to manage the requisition to payment process, brokerage such as usingelectronic exchanges and e-auctions, and electronic integration which may involveshared information systems in the supply chain, such as EDI or sharing computeraided design systems (Chopra et al., 2001a; Kalakota, 2000). Integration of information

across firms within supply chains is a requirement for efficient, responsive operations(Cooper et al., 1997; Mabert et al., 2003); integrated information has been described asthe glue that holds supply chains together (Child and Faulkener, 1998). Havingconsidered how e-procurement has been defined and described, the next section goeson to consider current use of e-procurement.

Current use of e-procurementIn the past, there were high expectations of the uptake of e-business using internettechnologies. In an investigation of internet-based supply chain management (Kehoeand Boughton, 2001), James H. Clarke, the President of Netscape was quoted from Business Times (1996):

The internet is the biggest thing that has happened in telecommunications since thetelephone. It is going to become as fundamental to the operations of businesses as thetelephone. You won’t be able to be in business, I’ll give it five years, without an internetconnection, because there will be so much business conducted that way.

In spite of the claimed business benefits that can come from embracing e-procurement,the extent of adoption in OECD countries is below expectations and progressing slowly(Pires and Stanton, 2005). Despite significant recent increases in internet sales in manycountries, total business-to-customer plus B2B internet commerce still only represents


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2.2 per cent of turnover in Australia, 1.3 per cent in Canada and ranges from 0.01 to 17per cent for European countries (OECD, 2007).

Information integration in supply chains is not well advanced (Fawcett andMagnan, 2002, Sanders and Premus, 2002, van Hoek, 2001), despite take-up of ERP

software (Mabert et al., 2003; Olhager and Selldin, 2003). Whilst promoted by softwarevendors as appropriate for all purchases in all types of organization, e-procurement iscurrently being used mainly to purchase a limited set of goods, predominantly officesupplies and MRO supplies (Davila and Palmer, 2003b). A UK survey concluded thatthe purchasing community appeared to be “sitting on its hands” rather thancommitting to e-procurement (Day, 2001).

Potential drivers of difference in adoption of e-procurementIn seeking to explain differences in e-procurement adoption between organizations,several factors are identified in the literature. There are five main types of factor thatappear to influence the adoption of e-procurement – organizational, readiness, supply,

strategic and policy factors.

Organizational factorsThe main organizational factors that appear to impact on the likely adoption of e-procurement are size and type of operation. e-Procurement is more evident in biggerorganizations than smaller. Small to medium enterprises (SMEs) often lag behindlarger organizations in e-procurement adoption (ISM/Forrester Research, 2003).Reasons for this include owners’ attitude, resource poverty, limited IT infrastructure,limited knowledge and expertise with information systems (Harland et al., 2007).However, e-procurement can be viable for SMEs through web-based enterprisecooperations (Berlak and Weber, 2004) or if the SMEs can see the business case fore-adoption (Harland et al., 2007).

Some types of organizational operations seem to lend themselves to e-procurement.The use of e-procurement applications often goes hand-in-hand with repetitivepurchases from suppliers, reducing human intervention and paperwork and oftenresulting in improved performance for buyers and suppliers (Melville et al., 2004;Sanders, 2005; Subramani, 2004). Routinization and repetition in the procurementsystem will increase the efficiency in this process and result in a higher level of electronicintegrationbetween buyers and suppliers (Choudhury etal., 1998). Make-to-order supplychains differ from make-for-stock supply chains, impacting on implementation of e-business (Gosain et al., 2005). High volume operations with substantial logistics,requiring regular tracking of items are more likely to use e-procurement (Lancioni et al.,2000). Operations with high usage of MRO supplies are more likely to use e-procurement(Croom, 2000). The B2B e-commerce solution is likely to vary with the number of buyers

and suppliers, their connectivity and the purpose of trading (Cullen and Webster, 2007).

Readiness factorsOrganizational readiness and external pressure impact on e-business strategy(Mehrtens et al., 2001b). Many firms are experiencing a number of major problems inimplementing e-business projects, due to hasty decisions in the presence of considerable media and software vendor hype, and often no theoretical basis behindthe determination of which applications are most appropriate (Cox et al., 2001).

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To attain the greatest benefits, purchasing processes should be evaluated andimproved before adopting e-procurement tools (Presutti, 2003). Internet technologiesenable integration with trading partners, yet amplify the need for fundamentalorganizational change (Power and Singh, 2007). B2B seller competence depends on

change disposition (Rosenzweig and Roth, 2007).Lack of readiness has been attributed mainly to human readiness (Osmonbekov

et al., 2002). Internal barriers to e-adoption are more significant than customer orsupplier barriers (Frohlich, 2002), suggesting supply management professionals needto ensure their own organizations are ready for e-adoption (Hartley et al., 2006).

Supply factorsE-procurement is more likely to be beneficial in dispersed supply chains as it helpscoordination (Liao et al., 2003). Different actors in supply chains have got differentpower, legitimacy and urgency to implement e-procurement, and e-procurement canhave an effect on trust in supply chain relationships (Gattiker et al., 2007; Klein, 2007).Lack of assistance and the structural inertia of large organizations in supply chains canbe a disincentive to implement e-business (Zhu et al., 2006). Different industries showdifferent propensities to e-procurement adoption, related to existing use of informationexchange infrastructures prior to the advent of the internet (Cagliano et al., 2005).

The greatest benefits of e-business occur when its application is fully integratedthroughout the supply chain (Currie, 2000). Some literature has pointed to thepossibilities of greater integration and collaboration across e-business-supportedsupply chains (Croom, 2005; Mclvor and Humphreys, 2004). E-procurement is morelikely to be adopted if it is perceived that suppliers have capability to deal with it;there are difficulties in integrating information systems across firm boundaries insupply chains if suppliers lack capability (Bagchi and Skjoett-Larsen, 2003).

Strategic factorsA company may adopt e-technologies as part of its overarching business strategy,contributing to improving firm performance and increasing competitive advantage. Thestrategic use of e-business has been considered in several studies, and how e-businessstrategy aligns with the overarching business strategy of a firm. The internet will onlybecome a powerful source of competitive advantage if it is integrated in firms’ overallstrategies (Porter, 2001). The role of IT has evolved from a productivity tool to a morestrategic level (Wu et al., 2003). An e-business strategy should specify the aims, goals andcontext of the application (Soliman and Youssef, 2001); these choices should be alignedwith other organizational and managerial choices, and integrated with the organization’sprocesses (Graham and Hardaker, 2000). These studies suggest that if organizations arebeing strategic in their e-procurement adoption, they may have a specific e-procurement

strategy, and that this will align with broader organizational strategy.

Policy factorsPublic procurement can be used to support broader government policies, both throughtraditional and e-procurement processes. Electronic procurement in the public domaincan be seen as a policy tool to support the delivery of public procurement policy,improving transparency and efficiency (Carayannis and Popescu, 2005; Croom andBrandon-Jones, 2005). e-Procurement can assist a government in the way it does


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business by reducing transaction cost, making better decisions and getting more value(Panayiotou et al., 2004). e-Procurement adoption and usage in the EU and US publicsector is being encourgaed (Carayannis and Popescu, 2005; Reddick, 2004).

Looking beyond e-procurement policy to public procurement policy more generally,

public procurement can be used to support societal reforms. There is evidence thatpublic procurement organizations in the EU have used government spending as aninstrument of industrial or social policy, placing contracts to support regionaldevelopment objectives, or promoting industrial competitiveness (Arrowsmith, 1995).Public procurement has been used to promote social outcomes (McCrudden, 2004) andenvironmental benefits (Walker et al., 2008). This aspect of public procurement can beoperationalised through e-procurement applications. For example, some public sectore-catalogues list eco-labels so that buyers can choose environmentally friendlyproducts (NHS PASA, 2004).

The public sector is not alone in considering social end environmental issues alongsupply chains. In a survey of nearly 400 CEOs participating in the UN Global Compact(Bielak et al., 2007), upward of nine out of ten are doing more than they did five yearsago to incorporate environmental, social, and governance into their core strategies,but challenges include the difficulty of managing supply chains across countries withdifferent regulations and norms for corporate social responsibility.

In sum, five main types of factor appear to influence the adoption of e-procurementby organizations – organizational, readiness, supply, strategic and policy factors.

The next section goes on to consider the digital divide, a salient contextual issueaffecting e-procurement in the UN.

The digital divideThe global digital divide has been defined as the differential extent to which rich andpoor countries benefit from various forms of information technology ( James, 2007).

Business use of the internet has become fairly standard in OECD countries: in25 countries more than 89 per cent of businesses with ten or more employees haveaccess to the internet and over half have their own web site (OECD, 2007). The growingperception that the internet is becoming an engine for global economic and socialchange has inspired both governments and intergovernmental agencies to acceleratethe diffusion of the internet around the globe via multimillion dollar programmes andinitiatives (Crenshaw and Robison, 2006).

While in some poor regions the number of internet users has grown substantially,overall the gap between developed and developing countries remains wide (UNCTAD,2005). For example, while 89 per cent of enterprises in EU nations are connected to theinternet, the same is true of only 9 per cent of firms in Thailand. The UN Conferenceon Trade and Development produced a report in 2004 on e-Commerce Development,

that showed that internet access is high among enterprises in developing countries,but that the adoption of e-business is low, especially amongst SMEs (I-Ways, 2005).Of those developing country SMEs using the internet, the main barriers to e-businessare perceived to be lack of network security, development costs, lack of client supplierreadiness and slow and unstable connections.

A digital divide exists between those with internet access and capability and thosewithout; this divide may be between organizations, such as small businesses andlarge firms, within nations, for example between urban and rural communities,

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or between nations, such as developed and developing nations. The level of the divideis most extreme between highly technologically developed nations, such as the USA,and less-developed nations, such as many of the African nations. Developing countriesin Africa and other regions face a competitive disadvantage because their businesses

have difficulty accessing the internet (Finance & Development, 2005).The digital divide appears to be growing both within and between nations,

reflecting and perpetuating inequalities. UN Secretary-General Kofi Annan addressedbusiness leaders on 18 June 2003 at a conference on the role of industry in bridging theglobal digital divide and stated:

The swift emergence of a global information society is changing the way people live, learn,work and relate [. . .] Yet too many of the world’s people remain untouched by this revolution.A digital divide threatens to exacerbate already-wide gaps between rich and poor, within andamong countries.

At the UN’s World Summit on the Information Society (WSIS, 2005), the importanceof removing barriers to bridging the digital divide was underlined, particularly those

that hinder the full achievement of the economic, social and cultural development of countries and the welfare of their people, in particular, in developing countries.

Certain factors seem to affect internet usage and e-business uptake amongstdeveloping countries. Developing countries whose policies promote economic growthand private sector competition have experienced higher internet intensities (Dasguptaet al., 2005). A country’s degree of development impacts on internet usage, and degreeof development can be viewed in terms of a country’s status in the world, level of democracy, foreign investment, manufacturing exports, and trade share (Crenshawand Robison, 2006; Santora, 2006). Factors impacting on the diffusion of e-commerce indeveloping countries include infrastructure in areas such as IT andtelecommunications, commercial, government and legal, social and cultural factors,transportation and minimum disposable income (Javalgi and Ramsey, 2001; Murillo,

2001). Trade using e-commerce is a means of improving the economic growth andperformance of less-developed nations (Lund and McGuire, 2005).

The digital divide is an important contextual factor for considering e-procurementadoption in the UN. It is important because in less-developed regions that the UN istrying to support, many suppliers have limited or no internet access, and hence areunable to trade using e-commerce technologies. The UN “does business with vendorsfrom all over the world and is actively working at increasing its sources of supply fromdeveloping countries and countries with economies in transition” (UN ProcurementDivision, 2008a). In the UN Procurement Manual , there is concern that procurementprocesses such as vendor database registration (p. 51) and evaluation of requests forproposals (p. 120) should not “unduly disqualify Vendors from developing countriesand countries with economies in transition” (p. 120) (UN Procurement Division, 2007).e-Procurement adoption across the UN may run counter to UN policies of supportingless-developed nations, regions and organizations.

The impact of setting e-procurement in this broader digital divide context is thatwhat may be good e-procurement practice in a profit-making firm may be viewed ascompeting with broader policy objectives of not-for-profit organizations. As the UN has apolicy to increase sourcing from developing countries and simultaneously considerse-procurement policies, there is increasing awareness that internet usage and e-businessis limited for suppliers in some countries. The way the UN is considering e-procurement


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adoption against the important contextual backcloth of the digital divide is to debatehow these competing procurement policy objectives might be aligned and to decide onan agreed policy response. The current study was commissioned to gather informationto aid decision-making, and the authors facilitated the debate at an annual general

meeting of the heads of procurement from across the UN.The next section outlines the methodology for this study.

MethodologyThis study investigated the attitudes to, and perceptions of, e-procurement held byheads of purchasing from across the UN. The study had three objectives; first,to determine the current and planned use of e-procurement amongst the UN system of organizations. Second, to investigate the factors affecting e-adoption, and finally toassess the policy implications of e-procurement, particularly in relation to the digitaldivide. We adopted a triangulation research methodology (Easterby-Smith et al., 2002)to study the same phenomenon from different perspectives to achieve reliability andvalidity (Denzin, 1978).

The research was conducted in the period from January to June 2003. There werethree main stages to the research methodology:

(1) a questionnaire survey sought to establish facts relating to the current andplanned use of e-procurement, and to provide initial indications of factors thatmight explain usage;

(2) three in-depth case studies explored these factors in more detail; and

(3) a workshop of the heads of procurement of all UN organizations examined theimplications of the findings and, more broadly, of e-procurement adoptionacross the UN, particularly in the context of the digital divide.

Details of the methods employed in each stage are provided in the following sections.

Stage one – questionnaire surveyA survey was decided upon in the first instance as there was no data available on thee-procurement activities of the various bodies of the UN. In addition, there wasinsufficient budget and time to individually meet or phone and interview the heads of procurement from across the UN in order to investigate e-procurement activity.

The first draft of the questionnaire survey was compiled using the literature asguidance. It was co-developed with staff at the UNDP/IAPSO, and questions werealtered in line with their comments to be more accessible and understandable toprocurement personnel in UN organizations. The questionnaire was piloted by sendingit to six staff at the UN Procurement Division and IAPSO, with requests to scrutinizequestionnaire length, structure, content and ease of response. The pilot respondentse-mailed back the completed questionnaire and sent the authors comments on thequestionnaire, which led to further adjustments being made.

The survey was designed to investigate factors influencing e-procurement adoption.The questionnaire included questions that addressed the scale of procurement,

the size of organization spend, number of registered suppliers, number of employees,number of countries operate in, the percentage spend with top ten suppliers, the spreadof spend across different product/service areas, and the existence and documentation of a procurement strategy. e-Procurement questions addressed the extent of e-enablement

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(e-mail and internet use), which procurement activities are performed electronically,technological capability to implement e-procurement, and driving forces fore-procurement from suppliers, customers, procurement strategy or IT strategy, andbarriers to e-procurement. The questionnaire asked for perceptions of UN capability to

integrate suppliers and UN organizations lacking e-enablement, and perceptions of howcritical e-procurement strategy is to deliver broader UN policies and strategies.

Each of the 93 heads of purchasing involved in the UN IAPWG were sent thequestionnaire with a supporting letter from the Chair of the IAPWG. Each personreceived the questionnaire in three ways, via e-mail, fax and post. A total of 26questionnaires were returned, a response rate of 28 per cent of the IAPWGmembership. As regards the split over the return of questionnaires,16 questionnaireswere emailed, seven were faxed and three were posted back.

Although the number of questionnaires returned was small, it did represent justunder a third of the IAPWG membership, and we decided that further statisticalanalysis was warranted. The survey data were subject to statistical analysis, using theStatistical Package for the Social Sciences. A series of tests suitable for a small sample( N ¼ 26) were conducted to examine relationships between independent anddependent variables. The focus in the statistical analyses was on identifyingwhether there were any significant differences between those organizations adoptinge-procurement and those that were not, for a range of dependent variables.

As the survey collected different sorts of data, tests suitable for small samples(Greene and D’Olivera, 1992) included the x

2 test for nominal data (e.g. yes/noresponses), the Mann Whitney U -test for rankable ordinal data (e.g. strongly agree tostrongly disagree on a five-point Likert scale), and independent samples t-tests forcontinuous data (e.g. budget).

As different tests were used, findings are reported at the 5 per cent ( þ ), 1 per cent( þþ ) and 0.1 per cent ( þþþ ) levels of significance, or as not significant (X).

The p-value was evaluated at a two-tailed significance level, as the direction of thedifferences was not predicted. Directionality established in the tests is indicated inthe findings section in Table II by þ or 2 .

The survey did not focus on the digital divide directly, but investigated current use of e-procurement across the UN, with a view to informing e-procurement policy discussionsamongst the heads of procurement. The analysis aimed to reveal whether there were anydifferences in the characteristics of UN organizations adopting or not adoptinge-procurement, across a range of factors, such as size, approach to strategy, number of suppliers, etc. For example,þþþ( f) shows that those organizations currently usinge-procurement were significantly more likely to have a documented procurement strategyat the 0.1 per cent significance level. Findings could also be negative, with – ( j) indicatingthat UN organizations not planning to implement e-procurement were less likely to have

an e-procurement strategyat the 1 per centsignificance level. Bracketed lettersin italics (a)assist identification of the findings in the discussion.

Stage two – case studiesCase studies are suitable to study a contemporary phenomenon within a real-lifecontext (Yin, 1994) such as the UN e-procurement context. The case studies permittedgreater understanding (Eisenhardt, 1989) of e-procurement issues within UNorganizations. The case study methodology has been employed extensively in


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operations management research (Voss et al., 2002). Three case studies were conducted,to explore further why some UN organizations were using or planning to usee-procurement and others were not. Cases were chosen for their differences, informed inpart by the findings of the survey and through discussions with staff at IAPSO. Cases

that were significantly different across a range of variables were selected to provide adiverse view of the UN. This range reflected the diversity of the UN in terms of technological capability, procurement capability, tangible goods vs intangible servicesdominated spend, and geographical/cultural diversity. IAPSO also helped in facilitatingaccess to case organizations.

The case organizations were the WHO, the ILO, and the United Nations Office of Nairobi (UNON). WHO is the directing and coordinating authority for health within theUN system. It is responsible for providing leadership on global health matters, shapingthe health research agenda, setting norms and standards, articulating evidence-basedpolicy options, providing technical support to countries and monitoring and assessinghealth trends. The ILO is devoted to advancing opportunities for women and men toobtain decent and productive work in conditions of freedom, equity, security andhuman dignity. Its main aims are to promote rights at work, encourage decentemployment opportunities, enhance social protection and strengthen dialogue inhandling work-related issues. UNON is the administrative centre for the UNEnvironment Programme, UN-Habitat, and other UN organizations in Kenya,providing support services including procurement.

The case studies were conducted using semi-structured interviews of key people ineach organization involved with procurement and information systems. Twelve peoplewere interviewed during the course of the three case studies (two at WHO, four atUNON and six at ILO). The interviews were conducted with senior staff in eachorganization, involved with procurement and with information systems – the numbervaried according to organization structure. It was initially envisaged that two days

would be spent with each organization, and follow up questions would be conducted byphone and e-mail. However, due to the timing of the research project coincidingwith the start of the Iraq War, some staff in UN Agencies were unable to spare thatmuch time.

The interviews varied from one hour to one and a half hours in duration, and weretaped and transcribed. The content of the interviews clarified and explored the specificquestionnaire responses for each organization in more detail, investigating the reasonsbehind, and context for, e-procurement decisions. A semi-structured interview formatof 18 questions was followed (shown in the first column of Table I entitled caseinterview questions). Documentary sources were also collected such as businesscases for e-procurement, and reports on the e-procurement system. In order to analysethe case data, a cross case comparison matrix (Miles and Huberman, 1994) was used to

assist in identifying similarities and differences between cases.

Stage three –UN heads of purchasing workshopIn order to investigate e-procurement further, the authors ran focus groups at the UNheads of purchasing workshop. A focus group has been defined as:

A group of individuals selected and assembled by researchers to discuss and commenton, from personal experiences, the topic that is the subject of the research (Powell et al., 1996,p. 499).

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U N A g e n c y / c a s e i n t e r v i e w q u e s t i o n s W o r l d H e a l t h O r g a n i z a t i o n

U n i t e d N a t i o n s O f fi c e i n

N a i r o b i

I n t e r n a t i o n a l L a b o u r O r g a n i z a t i o n

A n n u a l p u r c h a s i n g s p e n d ?

$ 8 7 , 4 1 0 , 0 0 0

$ 1 8 8 , 0 1 2 , 8 6 2

$ 4 6 , 7 4 3 , 5 3 9

N o . o f e m p l o y e e s ?

7 , 0 0 0

3 3 9

1 , 9 0 0

N o . e m p l o y e e s i n p r o c u r e

m e n t ?

2 8

2 4

2 0

N o . c o u n t r i e s p u r c h a s e i n

?

1 4 7

3 8

6 0

N o . r e g i s t e r e d s u p p l i e r s ?

1 5 , 0 0 0

2 , 4 0 0

2 , 0 0 0

N o . a c t i v e s u p p l i e r s ?

4 , 0 0 0

5 3 2

5 0 0

E - s o l u t i o n ?

U N W e b B u y , e - c a t a l o g u

e a d a p t e d

f o r W H O

I M I S U N S e c r e t a r i a t F i n a n c e S y s t e m

w i t h p r o c u r e m e n t e l e m e n t

O r a c l e – P r o j e c t I R I S –

w i l l a l s o

i n c l u d e fi n a n c e a n d H R

m o d u l e s

C o s t ?

U S $ 1 . 8 m i l l i o n t o t a l p r o j e c t c o s t s

U n k n o w n

U S $ 2 5 m i l l i o n t o t a l p r o j e c t c o s t s

I m p l e m e n t a t i o n d a t e s ?

L a u n c h 2 0 0 4 , i n c r e m e n t a

l l y . H O a n d

o n e r e g i o n a l o f fi c e

U n k n o w n

L a u n c h J u n e 2 0 0 4 – “ m i n i b i g b a n g ”

a p p r o a c h

W h y t h i s s o l u t i o n c h o s e n

?

O f f t h e s h e l f p r o h i b i t i v e l y e x p e n s i v e .

D o n n o t n e e d “ b e l l s a n d

w h i s t l e s ” .

N e w E R P s y s t e m i n t w o

y e a r s ,

w a n t e d t o b e c o m p a t i b l e

T h i s s y s t e m w a s d e v e l o

p e d f o r U N

s e c r e t a r i a t o f fi c e s

O r a c l e s o l u t i o n h a s fi n a

n c e , H R ,

t r a v e l a n d p r o c u r e m e n t

m o d u l e s

W e b - b a s e d / p r i v a t e - W A N

?

S e e m s b e s t a p p r o a c h f o r

g e o g r a p h i c a l l y d i s p e r s e d

o r g a n i z a t i o n . P a s s w o r d p r o t e c t e d

a c c e s s t o w e b s i t e , w i t h d i f f e r e n t

d e g r e e s o f a u t h o r i z a t i o n

W A N

I - p r o c u r e m e n t a v a i l a b l e

o n w e b .

P r o f e s s i o n a l p r o c u r e m e n t i n t e r f a c e

a v a i l a b l e o v e r W A N . W

i l l b e

p a s s w o r d p r o t e c t e d

C o n t e n t ?

W i l l b u i l d u p c o n t e n t o f

c a t a l o g u e

s l o w l y

P r o c u r e m e n t m o d u l e c a n b e u s e d t o

c r e a t e a n d a u t h o r i z e p . o . s , o r d e r

s t o c k i t e m s , v e n d o r r o s t e r

p r o c e s s i n g , e t c .

I - p r o c u r e m e n t c o n t e n t a

n d

p r o c u r e m e n t i n t e r f a c e f u n c t i o n s

d e v e l o p i n g , i n c l u d i n g a p p r o v a l o f

d o c u m e n t s e l e c t r o n i c a l l y a n d

c o m m o n v e n d o r d a t a b a s e

O r g a n i z a t i o n a l c h a n g e a s

s o c i a t e d

w i t h e - p r o c u r e m e n t ?

B P R e x e r c i s e 3 y e a r s a g o .

W H O W e b B u y w i l l a l l o w

d e c e n t r a l i z a t i o n o f m u c h

p r o c u r e m e n t a c t i v i t y , a l l o w i n g H e a d

O f fi c e t o f o c u s o n s t r a t e g

i c a c t i v i t i e s

N o B P R p l a n n e d c u r r e n t l y

I - p r o c u r e m e n t w i l l a l l o w

d e c e n t r a l i z a t i o n o f m u c h

p r o c u r e m e n t a c t i v i t y , H

O f o c u s o n

s t r a t e g i c a c t i v i t i e s . P r o c

u r e m e n t

m o d u l e m o r e a b o u t b u s i n e s s p r o c e s s

c h a n g e t h a n t e c h n o l o g y

c h a n g e

( c o n t i n u e d )

Table I.Cross-case comparison

matrix of WHO, UNONand ILO


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U N A g e n c y / c a s e i n t e r v i e w q u e s t i o n s W o r l d H e a l t h O r g a n i z a t i o n

U n i t e d N a t i o n s O f fi c e i n

N a i r o b i

I n t e r n a t i o n a l L a b o u r O r g a n i z a t i o n

T r a i n i n g n e e d s ?

M i n i m a l f o r W H O W e b B u y

T r a i n i n g f o r I M I S u s e r s

M i n i m a l f o r i - p r o c u r e m e n t , m o r e f o r

p r o f e s s i o n a l p r o c u r e m e n t i n t e r f a c e

C u l t u r a l i s s u e s ?

C u l t u r a l d i v e r s i t y o f 1 4 7

c o u n t r y

o f fi c e s

O n l y U N S e c r e t a r i a t o f fi

c e i n

d e v e l o p i n g c o u n t r y

E l e c t r o n i c a p p r o v a l o f d

o c u m e n t s

m a y b e a g a i n s t I L O c u l t u r e

G e o g r a p h i c a l i s s u e s ?

A s p u r c h a s e i n 1 4 7 c o u n

t r i e s ,

w e b - b a s e d s o l u t i o n s e e m

s b e s t

A s i n d e v e l o p i n g c o u n t r

y , p r o b l e m s

w i t h e x t e r n a l f a c t o r s s u c h a s s y s t e m

f a i l u r e s , p o w e r c u t s , e t c .

P u r c h a s i n g i n 6 0 c o u n t r i e s

S u p p l i e r i s s u e s ?

W H O i s o n e o f l a r g e s t b u y e r s o f

p h a r m a c e u t i c a l s , a n d f a c

e s s u p p l i e r

d o m i n a n c e i s s u e s

H o w d o e s e - i n i t i a t i v e fi t

w i t h

s o u r c i n g f r o m d e v e l o p i n

g c o u n t r i e s

– s u p p l i e r s m a y b e l e s s

e - e n a b l e d

V e n d o r c a t a l o g u e s w i l l

c o n t r i b u t e

c o n t e n t o f i - p r o c u r e m e n

t

K e y c h a l l e n g e s ?

W H O h a s e s s e n t i a l d r u g s i n i t i a t i v e ,

w h i c h w o u l d l i k e t o p u t i n t o p r a c t i c e

i n e - c a t a l o g u e s i n f u t u r e

H a v i n g i n t r o d u c e d I M I S

, m a y w a n t

t o c o n s i d e r w h e t h e r r e q u i r e f u r t h e r

e - p r o c u r e m e n t s o l u t i o n s ?

A s e - p r o c u r e m e n t p a r t o f

o r g a n i z a t i o n - w i d e e - s o l u

t i o n , m a y

n e e d t o m a n a g e o r g a n i z

a t i o n a l

c h a n g e

Table I.

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Focus groups rely on interaction within the group based on topics supplied by theresearcher (Morgan, 1997). An advantage of focus groups is that they can become aforum for change, both during the meeting itself and afterwards (Race et al., 1994).

The two authors facilitated focus groups at the UN/IAPWG annual meeting,

attended by 37 heads of purchasing from across the UN. The workshop ran from 9 a.m.to 3 p.m. The morning started with the authors presenting for two hours oninternational practice in e-procurement and on the findings of the case and surveyresearch, which had been circulated prior to the workshop in a draft report. Theauthors received feedback from the attendees. Before lunch, the heads of purchasingwere randomly allocated to five focus groups and given issues to discuss for one hourand 15 minutes.

The five focus groups tackled the following issues:

(1) digital divide between nations – capability;

(2) digital divide within nations;

(3) what type of UN organization might benefit from e-procurement, and what type

might not;(4) what benefits might UN organizations gain from e-procurement? and

(5) supplier readiness and commitment to e-procurement.

The focus group discussions were taped and transcribed, and flip charts used tocapture the discussion were collected. The authors moved between the focus groups tofacilitate discussion, and four members of IAPSO and one from UNICEF that hadassisted in the research since its inception were spread amongst the groups to furtheraid discussion. The groups were asked to nominate a speaker to present theirdiscussions back at the one and a half hour plenary session in the afternoon. In theplenary session, the authors facilitated a discussion to help inform UN procurement

policy relating to e-procurement.

Findings and discussionThe findings are presented in sections below relating to the research questions, whichwere:

RQ1. How do UN organizations currently use and plan to use e-procurement?

RQ2. Which factors affect the adoption of e-procurement in UN organizations?

RQ3. How does adoption of e-procurement across the UN affect policy issues?

First, findings related to the current and the planned use of e-procurement arediscussed. Findings concerning the factors affecting e-procurement adoption are

presented next. Findings on the digital divide are then presented. In each section,explanations of survey findings are provided from the case studies and the workshop.

How do UN organizations currently use and plan to use e-procurement? The survey of heads of procurement from across the UN found that 8 out of 26respondents claimed to use an e-procurement system. Out of 26, 18 said that theirorganization planned to be using e-procurement within the next three years. Analysis of the current usage of technology across different elements of the procurement process


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revealed invoicing stood out as most often rated “not at all electronic”, as paper copieswith signatures are needed.

Existing e-procurement solutions being used by organizations within the surveyincluded UNWebBuy, TC-PRIME and AFIMS, TSA Gateway, SAP, EPIC, Mercury,

Puridom Gateway Edition, Peoplesoft, Oracle, and various supplier portals via theinternet. Only three of the organizations reported significant monthly transactionsthrough an e-procurement system.

The three case studies provided greater supporting detail relating to the surveyfindings, as shown in Table I.

Previous efforts have been made to take a portfolio approach to e-procurement,adapting Kraljic’s model (van Weele, 2002) shown in Figure 1.

The three case study organizations were mapped onto this portfolio model inFigure 2 to position their current use of e-procurement.

WHO had done a similar portfolio analysis of product groups, mapping volume andcriticality of goods, and identifying those high volume low-value items that could beplaced on thee-catalogue. ILOhad also identifiedthose routine itemsthat could be ordered

through the i-procurement system, and has a different e-strategy for strategic goods andservices, via the professional procurement interface. UNON had stock items availableon their IMIS system, yet did not have a different e-procurement strategy for differentparts of the product/service portfolio.

Which factors affect the adoption of e-procurement in UN organizations? This section considers the findings relating to the second research question, andprovides more detail of the factors that explain differences in e-procurement adoptionbetween organizations.

Table II summarizes the findings from the survey concerning the factorsinfluencing e-procurement adoption.

Organizational factors. The survey analysis showed that UN organization size, interms of numbers of employees or annual budget, was not significantly related to

Figure 1.The e-procurementportfolio model

Leverage products

Bottleneck

items

Routine

items

Supply risk High

High

Low

Low

Impact on

financial

result

‘Secure supply

+ search for

alternatives’

‘Performance

based

partnership’

‘System

contracting’

‘Competitive

bidding’

Strategic

products

Corporate

purchasing

super site

Balance

Balance

Electronic data

interchange

Supplier specific

e-solutions

E-procurement

solutions

Virtual auctions

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propensity to adopt e-procurement, which contrasts with previous studies(ISM/Forrester Research, 2003, Harland et al., 2007). In hindsight, it may have beenbeneficial to find a way to measure organizational size that relates more closely toe-procurement, such as in terms of number of purchases.

The type of operation was related to e-procurement adoption, with those agenciesplanning to implement e-procurement being significantly more likely to be developmentagencies that work in developing countries over time (e.g. UNDP) or having ahigh-logistical component to their operations (e.g. WHO have pharmaceuticals shippedto developing nations).

In the case studies and the workshop, it was revealed that the urgency and lack of forward visibility of humanitarian aid provision, such as disaster relief (e.g. UN HighCommission for Refugees), requires short-term procurement local to the site, as far aspossible. The survey analysis revealed these types of organizations were found to beless likely to adopt e-procurement (a) . The requirements for e-procurement, therefore,differ between types of agencies supporting findings that e-procurement depends ontype of operations (Gosain et al., 2005; Lancioni et al., 2000).

Readiness factors. All survey organizations used e-mail and had access to theinternet. However, 3 of the 26 strongly disagreed with the statement that they hadsufficient IT capability to implement an e-procurement system. Organizationalreadiness impacts on e-business strategy (Mehrtens et al., 2001a). Organizations

currently using and planning to implement e-procurement were significantly morelikely to agree that the UN is ready for an e-procurement initiative ( b,c), and less likelyto agree that the UN should defer this decision ( e,f).

The following quote was captured in a case study, which supports the viewthat lack of readiness has been attributed mainly to human readiness (Osmonbekovet al., 2002):

There are not professional staff specialized in this field. Furthermore, in order to implementan e-procurement strategy in the future, more information and expertise would be necessary.

Figure 2.Case organizations

mapped onto the portfoliomodel

‘System

contracting’

Leverage products

Bottleneck

items

Routine

items

Supply risk High

High

Low

Low

Impact on

financial

result

‘Secure supply

+ search for

alternatives’

‘Performance

based

partnership’

‘Competitive

bidding’

Strategic

products

Corporate

Purchasing

Super Site

Balance

Electronic data

interchange

Supplier specific

e-solutions

E-procurement

solutions

Virtual auctions

ILO

UNON

WHO


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Supply factors. Some organizations have formalized purchasing procedures (e.g. ILO),whereas other organizations have more flexible purchasing procedures as their UN staff need to buy goods in the field in emergency situations (e.g. UN High Commission forRefugees).Organizations vary in their degreeof collaboration in contracting with suppliers.

Independent variablesCurrent use of e-procurement

Planned use of e-procurement

Organization factors

Number of organization employees X X

Organization budget X X

Type of organization (emergency/humanitarian aid vs development) X þþ (a) Readiness factorsUN ready for e-procurement initiative þþ ( b) þþ (c)Defer e-procurement initiative 2 (d) 2 (e)Lack of IT capability at local offices X X

Available software is too complex X X

Insufficient funding X X

Organizational culture X X

Lack of senior management commitment X X

Trust relationships with suppliers not strong enough X X

Suppliers ability and willingness to use e-procurement lacking X X

Other priorities take precedence over e-procurement X X

Lack of confidence over e-transactions X X

Security problems X X

Political considerations X X

Supply factorsNumber employed in procurement X X

Number of employees authorized to procure X X

Procurement spend X X

Number of registered suppliers X X

Geographic dispersal of procurement X X

Spend concentration on top ten suppliers X X

Strategic factorsExistence of a procurement strategy þþþ ( f) þþ (g)Documented procurement strategy þþ ( h) þþ (i)

Existence of a e-procurement strategy X – ( j )Documented e-procurement strategy 2 ( k) – ( l)Different strategies for different parts of product/service portfolio X þþ (m)Purchasing strategy driving the selection of an e-procurementsystem

X X

IT strategy driving e-procurement þ (n) X

e-procurement strategy being driven by suppliers X X

e-procurement strategy being driven by customers X X

e-procurement strategy being driven by own organization X þ (o)Constraints external rather than internal þ (p) X

Policy factorse-procurement strategy essential to deliver future UN procurementstrategy and policy

X X

UN has the capability to integrate non e-enabled UN organizations

and suppliers

X X

Notes: X ¼ results not significant at 5 per cent level; (italics) ¼ in discussion

Table II.Independent t -tests for

independent variablesand current and plannede-procurement adoption

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Out of 26, 25 respondent organizations were responsible for their own contracting. Out of 26, 17 used shared contracts with other UN organizations and 11 led contracts on behalf of other UN organizations.

The case studies suggest that of all the goods and services bought by the UN,

mainly offices supplies and catalogue items are supplied via e-procurement. Thiscorresponds with findings that e-procurement is mainly used to purchase a limited setof goods, predominantly office supplies and MRO supplies (Croom, 2000). Likeliness toadopt e-procurement was not found to be significantly related to geographicaldispersal of supply activities or supply chain features.

Strategic factors. A total of 20 of 26 respondents felt that the time was right for theUN to start an initiative to encourage e-procurement. Out of 26, ten respondentsclaimed that their organization had an e-procurement strategy already, and eight of these had documented it. However, only nine respondent organizations had differente-procurement strategies for different parts of their product/service portfolio. Thisappears surprisingly low, considering the large range and heterogeneity of productsand services purchased by the UN.

The relationship between e-procurement and strategy (Porter, 2001) was apparentin the survey findings. Respondents were asked whether they had strategies forprocurement and e-procurement, and whether these were documented. The aim was toexplore whether those organizations that had more advanced strategies had also mademore progress with e-procurement implementation.

Those organizations currently using or planning to implement e-procurement in thenext few years were significantly more likely to have a procurement strategy ( f,g)that was documented (h,i). Unsurprisingly, organizations not planning to implemente-procurement were lesslikely to havean e-procurement strategy ( j) thatwas documented( k,l). Those organizations planning to implement e-procurement were more likely to havedifferent e-procurement strategies for different parts of the product/service portfolio (m),

and were adopting a portfolio approach to e-procurement (van Weele, 2002).Those organizations currently using e-procurement were significantly more likelyto agree strongly that their e-procurement strategy was being driven by theirIT strategy (n) confirming previous studies that relate e-procurement adoption to ITstrategy (Chopra et al., 2001b). Organizations planning to implement e-procurementwere more likely to agree e-procurement strategy was driven by their own organization(o), corresponding with the view that organizational readiness impacts on e-businessstrategy (Mehrtens et al., 2001a). Those organizations currently using e-procurementwere significantly more likely to agree that constraints to e-procurement are morelikely to be external with suppliers rather than internal (p) highlighting the role of suppliers in e-procurement (Bagchi and Skjoett-Larsen, 2003).

How does adoption of e-procurement across the UN affect policy issues? This section discusses the findings in relation to the final research question,considering the policy implications of e-procurement adoption across the UN, andmoving to a specific focus on the digital divide. The subsequent section discusses theUN policy response to e-procurement in the context of the digital divide.

There is evidence internationally of public procurement being used as a lever todeliver broader policy objectives (Arrowsmith, 1995; McCrudden, 2004). The UN,including its many affiliated agencies, represents a vast global market for suppliers of


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virtually all types of goods and services. The UN, and in particular the UNDP, hassupply policies concerning increasing purchasing spend with suppliers fromdeveloping countries to enhance their economic development.

The IAPWG has had considerable success in promoting and implementing supply

policies across the UN such as not selecting suppliers that use child labor or are involvedin the production of landmines, which are shaping the international aid supply market.UNICEF’s policy on child labor is particularly strict, far more so than save the childrenwhose policy allows some flexibility if the suppliers are providing food, schooling ormedical support, and the hours worked by children is kept to a minimum.

The case studies revealed how some UN policies may be implemented through thee-procurement system. For example, WHO has an essential drugs policy, suggestingthat developing nations need 2,000 (mostly generic) essential drugs rather than the tensof thousands of branded drugs offered by pharmaceutical companies. The policy isbeing considered for promotion through the e-procurement catalogue system, and theessential drugs could be offered on the WHOWebBuy facility to developing nations.This is an example of how e-procurement can deliver broader policy objectives.

However, the case studies and policy workshop revealed complexity and particularpolicy issues that had to be dealt with. The main issue dealt with in the workshop wasthe digital divide.

The digital divide. During the case study interviews, concerns were raised regardingthe digital divide. Some concerns related to inconsistent capability between differentparts of the UN supply system, exemplified in the quote:

We are dealing with 1,500 institutes (end-users) and 5,000 suppliers in nearly 110 countries.Moreover, the UN is not an integrated corporation. While internal aspects of e-procurementcan be implemented, it is not reasonable at this time to expect our counterparts in developingcountries to have reliable broad-band internet connections.

Other concerns related to lack of IT capacity in suppliers in developing nations:

E-procurement should be deferred in order to provide equal opportunities to suppliers fromdeveloping countries which do not have sufficient IT capacity.

More formal representation of the views of the less developed members of the UN isprovided:

The United Nations is mandated by its legislative bodies to increase procurement fromdeveloping countries and countries with economies in transition. In this respect, MemberStates want the United Nations to maintain conventional procurement means in order not todisadvantage suppliers from these countries.

The digital divide was described by participants at the workshop in terms of accessibilityto, anduseof, information. Factors affecting thedigital divide are summarized in Table III,

derived in the workshop. Theinternational divide was perceived as the most extreme formof digital divide (as opposed to, say within nations or between small and large firms) asclusters of factors occur together.

The digital divide presents considerable challenges forthe purchasingcommunity, andis an issue that all areas of e-commerce face. From an academic perspective, there is a lackof empirical research investigating e-procurement in the context of the digital divide bothin a global context and within nations. From a practitioner perspective, organizations mayface e-procurement connectivity issues with suppliers in developing countries with a lack

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of technological infrastructure and online access. Whilst developing countries might

benefit from e-commerce, doubt hasbeen raised over whether they are readyto participatein e-commerce, have the kinds of industries that act as demand-pull, and whether social,political and institutional arrangements are in place to encourage and sustain e-commerce(Lund and McGuire, 2005). In developed countries, the digital divide may be evident in thegap between SMEs and larger suppliers in e-procurement adoption (ISM/ForresterResearch, 2003). e-Procurement adoption may limit the supply base, and contribute to thedigital divide. One focus group participant commented:

The pure procurement issue is that by implementing e-procurement, the UN should not limitaccess and penalise developing country suppliers.

UN policy response

As a result of the whole study, the UN heads of purchasing chose to act in a number of ways. First, they saw their role as assisting in developing economies, legislation,education, partnerships with private business and good governance. However, they areconstrained by their own legislation requiring them to provide services to all memberstates. The study demonstrated that a UN policy to implement e-procurement across allUN organizations would act to the detriment of member states that were less-developednations, and would be in direct conflict with UN development policy. Therefore, theychose not to pursue e-procurement unilaterally. Rather, individual organizations on acase by case basis should review their own positions and use e-procurement asappropriate to their situations, in line with broader UN policies. Advisory services,funding and support should be provided, particularly education and partnering to helpmitigate the effect of the digital divide. They also decided to establish a mechanism for

inter-agency learning relating to e-procurement experience. Following the study, theUN has since launched a series of programmes to encourage businesses in developingcountries to adopt e-commerce ( Supply Chain Europe, 2004).

ConclusionsThis study investigated issues, influences and impacts of e-procurement adoption byexploring the perceptions of UN heads of purchasing in an extended multiple-method casestudy. There appears to be a balancing act between UN supply policy to increase

Resources Financial/economicalInfrastructure

Environment PoliticalSocialCultural

Capacity TrainingEducationTechnical expertiseHuman resources

Geographical TerrainUrban/ruralPopulation distribution

Source: UN IAPWG heads of purchasing Workshop (2003)

Table III.Factors affecting the

digital divide


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purchasing from developing nations, and any IAPWG initiative to implemente-procurement more widely across the UN family. Therefore, the choice by the UNheads of purchasing not to implement a universal e-procurement strategy seems prudent.Organizations in the UN may benefit from being “conservative adopters” (Davila and

Palmer, 2003a), adopting a “wait and see” approach.This research had several limitations. The limited number of respondents to the

survey prevented more advanced quantitative analysis. The case studies would havebenefited from more interviewees. The study was also restricted to organizations in alarge, complex confederal network, which may limit generalisability. However, thefindings may have salience in the public, not-for-profit and voluntary sectors, whereprocurement is increasingly used as a lever to achieve social and economic reform, andin private sector firms keen to demonstrate corporate social responsibility. This studymay also have broader relevance for other complex international networks such asmultinational corporations, which are large, geographically dispersed, goal disparateinter-organizational networks (Ghoshal and Bartlett, 1990). e-Procurement adoption

amongst multinational corporations will impact upon suppliers, especially in the SMEsector who are often reliant on the support and existence of multinational corporationslocated in their region.

More research could be conducted to assess how e-procurement adoption and othercomplex policy objectives interact. The digital divide is a salient contextual factor forthe UN in its consideration of e-procurement, and is likely to have resonance for a rangeof other organizations in different contexts. Future research could investigate whatrange of interventions might help to bridge the divide and assist e-procurement uptakeamongst suppliers in developing countries.

Much research on e-procurement has been conducted in the private sector (Tatsiset al., 2006) and this research contributes to the small but growing number of studies of e-procurement in the context of the public and not-for-profit sectors (Carayannis and

Popescu, 2005; McManus, 2002) by studying e-procurement in the UN. What may begood practice in a profit-making firm may be viewed as in conflict with broader policyobjectives of not-for-profit and public sector organizations.

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About the authorsHelen Walker is the Deputy Director of the Centre for Research in Strategic Purchasing and Supply,University of Bath School of Management. Her research interests are sustainable procurement,public procurement, and the role of procurement in influencing supply markets. Helen Walker is thecorresponding author and can be contacted at: [email protected]

Christine Harland is the Director of CRiSPS and her main research interests are in supplystrategy, embracing supply chain management and inter-organization network strategy.


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E-procurement in the United Nations

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