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CHAPTER 1
The Problem and its Settings
1.1 Project Context
An Auction is a Latin word which means augment. Auction is a bid, a process
where selling, buying, and services offered take place. There are several types of auctions
and certain rules exist for each auction which may include minimum price limit,
maximum price limit and time limitations etc. depending upon the auction method biddercan participate remotely or in person. Remote auction includes participating through
telephone, mail, and internet.
Shopping online has widely grown. nline auction is becoming more and more
popular in electronic commerce. !ence its system must increase its "uality and security.
The online auction system is a model where we participate in a bid for products and
service. This auction is made easier by using online software which can regulate
processes involved. There are several different auction methods or types and one of the
most popular methods is #nglish Auction System. $t is designed to be highly%scalable and
capable of supporting large numbers of bidders in an active auction.
nline Auctioning System has several other names such as e%Auctions, electronic
auction etc. The re"uirement for online auction or online bidding can be more accurately
specified by the client. $t should be healthy and will be a good practice when it is made
more transparent as a matter of fact.
nline &idding has become more wide spread in all sorts of industrial usage. $t
does not only include the product or goods to be sold. $t also has services which can be
provided. 'ue to their low cost this expansion made the system to grow.
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A Re"uest for uotation is a re"uest that a company puts out when they want to
hire contractors to perform a 2ob. The R3 is basically their way of encouraging
contractors to bid against each other. The company that issues an R3 then selects one of
the bidders to take the 2ob.
A Re"uest for $nformation 4R3$5 is a proposal re"uested from a potential seller or
a service provider to determine what products and services are potentially available in the
marketplace to meet a buyer)s needs and to know the capability of a seller in terms of
offerings and strengths of the seller.
1.! "bjecti#es o$ the Stud%
6.7.6 8eneral ob2ective
The general ob2ective of the pro2ect is to develop an online bidding system for
ne ommerce with a basic Re"uest for $nformation, Re"uest for -roposal and Re"uest
for uotation9 and to increase the knowledge on how procurement system works where it
is needed to be used and serves as a backbone of the online bidding system.
6.7./ Specific ob2ectives
This study aims0
to develop a webpage containing complete reports on each elements system
4Re"uest for $nformation , Re"uest for -roposal and Re"uest for uotation59
to develop a system that will help the customer to bid more precisely and more
secured9
to earn necessary information on how procurement data are established9 and
to establish a concrete knowledge about procurement system that will be used in
making the online bidding system.
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1.& Scope and 'imitations o$ the Stud%
6.:.6 Scope
#nd to end system 4Re"uest for $nformation , Re"uest for -roposal and Re"uest
for uotation5
&idding structure of the system
'ata process on how the nline &idding supposed to work
Relation between system integrators and client or suppliers.
6.;./ Limitation
nly allowed to $.T, Telco, #lectrical, #lectronics, and Software Staffs
ash or payment transactions will be done manually by the company Staffs
There will be no online communication or chat context. All of the conversation
will be held through phone calls that will be answered by the assigned staff.
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CHAPTER 2
Re#ie( o$ Related 'iterature and Studies
3or further understanding of the study, the researchers made use of different
reading materials related to the online system. These materials such as books, maga1ines,
newspapers, thesis, and other web articles are essential in broadening the knowledge of
the researchers. These will also guide the researchers to achieve their ob2ectives by
getting ideas on other related studies and make improvements as possible.
The information gathered by the researchers focuses on the development ofnline &idding or -rocurement system and its advantages to the economy, consumers
and businesses. Security measurement information in terms of payment and customer
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2.1 Related 'iterature
This review consists of books, articles, and documents that focus on the same
sub2ect matter or other concepts of the study.
)oreign 'iterature
"nline *idding S%stem+Aesti#a Procurement S%stem+S%stem ,1
Automating a procurement process re"uires procurement software. -rocurement
processes vary. They can include purchase order management processes, receiving,
invoicing, R3 +anagement, and more.
At Aestiva, we use the termprocurement softwareto indicate software that also
manages multi%supplier purchase re"uests. These situations re"uire software tools to split
the purchase re"uests into two or more re"uisitions. An Aestiva -rocurement Software
system, like our -urchase rder systems, can be expanded with the modules you need. A
-rocurement Software system is not really a single product. $t is a family of products that
constitute a system. A -rocurement Software system can stand%alone or be integratedwith an #R- system, for example. $t can be single%currency or multi%currency, single%
language or multi%language. -rocurement systems can be set up for manufacturing or
government agencies for banks or retail chains. They can be installed on your own
e"uipment or cloud.
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"nline *idding S%stem+ex*id Procurement S%stem+S%stem ,2
e&id e=change is an integrated procurement system for supplier management, e%
sourcing, and contract management. !elp the procurement team by providing the
software tools for strategic sourcing to drive process efficiency and cost saving
throughout the organi1ation. The e&id e=change e%procurement platform is an easy%to%
use, affordable, and customi1able software%as%a%service solution used by large and small
businesses and government procurement organi1ations.
"nline *idding S%stem+SAP Supplier Relationship -anagement+ S%stem ,!
SA-has a product that allows a company to manage its relationship with its
vendors more successfully. The SA- Supplier Relationship +anagement 4SR+5
application can connect a company with its supply base which allows multiple levels of
suppliers, partners, and manufacturers to work together while you reduce the cost of
goods sold. There is a number of functions that are found in the SA- SR+ application
including procure to pay, catalog management, and supplier evaluation.
Procure to Pa%
This function is used to enforce procure to pay best practices that will reduce
procurement costs. This is achieved by improving supplier communications, streamlining
procurement operations, and improving cost management. $n this function it is possible to
cut process costs and speed cycle times by automating procurement and leveraging
workflow. >ou can also improve supplier relationship by assisting electronic transactions
and collaboration. ompanies can use the procure to pay data to create strategies with
vendors.
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Catalog -anagement
This function is used to manage the catalogs that are supplied by vendors and
used by the company)s staff to purchase items. The catalog data has to be synchroni1ed
with the SA- master data and the data should be checked for "uality to ensure that it is
correct for users. The catalog data should be maintained so that the data can be cleansed,
loaded, aggregated, and put in a position where the data can be searchable. The catalog
function in SA- SR+ also provides companies with the ability to add images to the
catalogs they use as well as internet and print publishing.
"perational Sourcing
This function allows a company to look across the enterprise to gain visibility
even when a company is using a variety of purchasing solutions. The functionality gives
the purchasing department a view of the demand for goods across the company, even
non%SA-applications so that they can combine the total expenses and improve the
negotiation process with vendors. The purchasing department can work with the data in
the application to co%operate with vendors to improve overall savings.
Contract -anagement
entrali1ed contracts with vendors allow a company to use their total expenses
across a number of locations to help negotiate better prices. The SA- SR+ application
gives a purchasing department the tools to track the money spent and ensure that
employees are purchasing the correct items for the prices negotiated with the vendor.
Sel$ Ser#ice Procurement
This functionality gives employees of a company the opportunity to purchase
items they need from vendors via an internet portal. This allows employees who do not
normally purchase items, to be able to purchase items through the catalogs that are
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available to them. &y developing a set of business rules for the employees, they can
purchase items which can trigger an approval workflow so the items are received in a
timely fashion.
Reporting
The SA- SR+ application contains operational reporting that allows a company
to monitor purchasing activities, measure contract compliance, and review organi1ation
wide spending and sourcing needs. The reports can use data from the SA- SR+ and SA-
#R- systems.
Current Release
The current release of the SA- Supplier Relationship +anagement is version ?.@,
which was released in /@@. The first SA-e%procurement solution was offered in 6,
and over the years, the solution has grown from a Beb%based catalog re"uisitioning
solution aimed at operational excellence to the solution today that offers complete supply
management. SA- SR+ is based on a number of best practices that come from provenbusiness and industry expertise. $t also provides a wide range of pre%configured business
scenarios that companies can "uickly implement and benefit from with improved
efficiency in their business processes.
"nline *idding+ Coupa ProcurementS%stem + S%stem ,&
oupa
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-urchase re"uisitions0 (sers can re"uisition anyitem from anysupplier, and put it
through your purchasing process for approval. -urchase order software0 i&uy lets buyers
place and manage purchases from any ecommerce site. Real%timebudgeting application,
so you
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slowly and painfully onwards to an eventual but unsatisfying conclusion. $t
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Togetherness is a word not often attributed to procurement, but =changing
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cost. A good procurement process should also be delivered efficiently to limit the time
and expense for the parties involved.
-rocurement is also a ma2or activity in government. $n the -hilippines, hundreds
of billions of pesos is spent by the government to buy goods and services to operate thebureaucracy, carry out pro2ects, and deliver services to its citi1ens. The Borld &ank, a
development partner, cites that for the past four years, an average of -6/6 billion worth
of infrastructure, e"uipment, materials, supplies, and services pass through government
procurement processes each year which accounts for 6;H of the country
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'evelopment Agency 4$'A5 as a common portal for registration of suppliers and
advertisement of bid opportunities.
The passage of the 8overnment -rocurement Reform Act in /@@7 further boostedthe importance of -hil8#-S. This law set forth the rules and regulations for government
procurement transactions as guided by the principles of transparency, competitiveness,
streamlined procurement processes, accountability, and public monitoring. $t re"uired allgovernment re"uirements from goods and consulting services to civil works to be
centrally posted through an internet infrastructure which will be called the -hilippine
8overnment #lectronic -rocurement System 4-hil8#-S5.
Bith the implementation of RA 6C:, all *ational 8overnment Agencies 4*8As5,
8overnment wned and ontrolled orporations 48s5, 8overnment 3inancial
$nstitutions 483$s5, State (niversities and olleges 4S(S5 including Local 8overnment
(nits 4L8(s5 are mandated to use the -hil8#-S. Suppliers, manufacturers, contractors
and consultants are also re"uired to register as well. Through the use of the -hil8#-S,
transparency in government procurement is enhanced since opportunities to trade with
government and the ensuing transactions are provided online. $nformation on changes in
terms of references, bid schedules, and the winning bidder and contract amount are all
accessible through the system. $n addition, the electronic catalogue, which providesinformation on pre%approved cost of commonly used items, will help government
auditors check whether the supplies purchased by a government agency are not grossly
over%priced. &efore the enactment of RA 6C:, bid opportunities costing /+ and above
for goods and consulting services and ;+ and above for civil works should be advertised
twice on two newspapers of general circulation. Bith the new law, opportunities are now
re"uired to be advertised only once in a newspaper of general circulation and posted
continuously in the -hil8#-S for seven calendar days. As a result, the government has
been able to save almost -hp I@@ million in newspaper advertisement expenses alone as
of June /@6@.
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As of September 6;, /@6@, the -hil8#-S hosted bid opportunities posted by
66,6:? government agencies and accessed by :;,;; goods and services providers. ver
6,@C@,@@@ bid notices have been posted by various procuring entities in the system.
lobe Telecom e4*id S%stem
The $nternet has provided uni"ue opportunities for 8lobe Telecom to interact with
its suppliers and partners as closely as if they were a single entity. Termed as the Knew
economyK, the company is enhancing its procurement approach and infrastructure in
order to maximi1e the benefits that can be derived in participating in this collaborative
environment.
8lobe)s e%Sourcing -ortal was developed in order to provide our partners an
effective means of 2oining in an KecosystemK that simplifies the procurement processes.
ur vision is to build an environment that promotes stronger business relationship by
utili1ing the advancement in communication technology and enterprise mobility. Truly,
this is e%ommerce in action.
-EC 5ET6"R7 S"'8T"5
They have a wide array of global brands and $T products that uses our
distribution services as to reach the intended market. !ere, they are parked under their
respective technologies. These products under their respective technologies are what
makes up the salient components of every business< $T infrastructure. As a alue Added
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'istributor in the $T industry, they provide their business partners and end clients with
various pre%sales $T services in the fields of wired and wireless data, voice and video
network design $T services, demo facilities, solution proofs of concept, reference
systems and network value engineering design services. These services are $S @@60
/@@C, $T$L and '*& ertified to help feel more at ease when dealing with them. +#
have been in the industry since 6; with their still expanding worth of networks to help
company choose products in the $T, $T industry.
2.2 Related Studies
This section consists of information gathered from thesis and dissertations which
are also relevant to the research.
)oreign Studies
Procurement Procedures 8nder the Pri#ate )inance nitiati#e9 The
"peration o$ the 5e( 'egal )rame(or:
(Dr. Richard Craven, Supervised by Professor Sue Arrowsmith and
Professor David Fraser, 2!2"
Richard
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practice9 perceived problems, including any legal uncertainty and constraints on best
practice9 strategies to conduct the process within the constraints9 and the factors that
influence compliance and approach to legal risk.
The mpact o$ the EC Procurement Rules on Corporate Responsibilit% in the
Suppl% Chain9 a Stud% o$ 8tilities
(#y Dr. $%eanor Aspey, Supervised by Professor Sue Arrowsmith and
Professor David Fraser and Frances Darton of Achi%%es &nformation 'td,
2!!"
'r. #leanor)s thesis examines the effect of the # procurement legislation on theimplementation of corporate social responsibility policies by the (M utilities. The
thesis aims to discover any problems and uncertainties in the area of orporate
Responsibility in the Supply hain within utilities caused by the # rules, any positive
benefits of the rules on designing corporate social responsibility policies, and the
response of the utility sector in practice. The thesis involves legal analysis of the relevant
# rules and empirical research, interviewing those responsible for implementing SR
policies in a sample of (M utilities. !er research was funded by the #SR and Achilles
$nformation Ltd.
Public Procurement and Tied Aid in the European 8nion9 A Critical Anal%sis
o$ the 'egal )rame(or:
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(#y Dr. Annamaria 'a Chimia, Supervised by Professor Sue Arrowsmith,
2"
'r. Annamaria La himia)s thesis provides a critical examination of the legality of
practice of tied aid in the #( +ember States, under regional and international trade rules.
$t focuses on the "uestion of the compatibility of tied aid practices with # rules and
principles and with the international legal instruments relevant for the #(, such as the
BT Agreements.
The thesis is based on the premise that tying of aid is a problem that needs to be
addressed, and the analysis elucidates the legal tools to help address the problem by
identifying the legal rules that are relevant, by considering how they apply to tied aid, and
by highlighting where amendments may be needed to limit the practice of tied aid by
using legally binding international and regional instruments. Two #uropean countries are
taken as examples in order to provide a practical illustration of the real world scenarios
where the law must deal with, namely $taly and (nited Mingdom.
*u%ers; Sellers and *ids The tendering -ar:et in Public Procurement
(#y )enri* Stensson+ niversity essay from #%e*in-e e*nis*a
)/-s*o%a0&nst. f/r industrie%% e*onomi, &$1 2!34"
This thesis studies the function of the tendering market in public procurement.
The effects of the characteristics of buyers, sellers, and bids in the tendering market are
analy1ed. A dataset of construction tenders in the county of Malmar, Sweden is analy1ed
by using regression analysis. Several findings are made about how characteristics of si1e,level of organi1ational knowledge, and location of buyers and sellers affect the
functioning of the tendering market in public procurement. The market for public tenders
is part of the public procurement market which is described in the thesis from a #uropean
and Swedish perspective.
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The roles of public procurement authorities and of the supplying firms in this
market are described and the interactions of these players are analy1ed. Tenderinginvolves an auction procedure and the thesis treats some aspects of auction theory. The
sub2ect of the thesis to study the functioning of the public procurement market based on
the characteristics of the players within it is a new approach, but the characteristics that
are studied in the thesis and their effects on the behavior of the participant in the public
procurement market have all to some extent been described in the literature. A short
presentation of the main findings of the analysis0
The location of a firm here, meaning the site of its head"uarter, has an
influence on the fre"uency with which the firm is bidding. The effect is a small
positive correlation between the firm being local 4in the place where the contract
of the tender is to be carried out5 and its participation in tender. The organi1ational
knowledge of a firm is positively correlated with the fre"uency with which it
submits bids in public tenders. The more organi1ational knowledge there is in the
buying public entity, the smaller will the price variation be in the bids submittedin a tender.
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There is a negative relationship between the si1e of the tender and the
variation in price among the bids received. &eing a local firm slightly increases
the chance of winning a tender. The study gives an indication that the studying of
the described characteristics have effects on the behavior of the participants in the
market and it opens for further research in the area.
Assessment o$ E$$ecti#eness o$ Public Procurement Process9 The Case Stud% o$
-inistr% o$ )inance and Economic A$$airs n Tan
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study in the +inistry of 3inance and #conomic Affairs of Tan1ania. This study has
targeted interviews and observation which have shown there are ineffective of the public
procurement process. These are in2ected by the public procurement Act *o. /6 of /@@:
and others are caused by inade"uate budget to pay suppliers on time, limitation of skills,
and knowledge to the ministerial staffs and -+( staffs.
3urthermore, researchers have recommended that there is a need to amend the
public procurement Act *o. /6 of /@@: and accommodate some key points that will
enhance efficiency and effectiveness of the procurement process which will increase
revenue collection and emphasi1ing training of user -+( staffs. !owever, this Act is not
panacea E solution to everything but it must be dynamic to accommodate new issues as it
will be raised new techni"ues and principles that will ensure accountability and efficiency
on procurement.
'ocal Studies
epartment o$ Heath Customi
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procurement reform activists and a core group of highly competent and honest
professionals and support staff.
The procurement reform is an essential component of our health sector reform
agenda. The 8overnment -rocurement Reform Act or Republic Act 6C: of /@@7 and its
$mplementing Rules and Regulations give us a legal basis for conducting our
procurements. $n addition, the 8overnment -rocurement -olicy &oard wherein the
'epartment is an active member has been issuing standard bid documents and forms,
various resolutions, circulars, opinions, and generic manuals to support compliance,
facilitate the procurement processes and make it more efficient and effective. Bith the
variations in procurement practices in each of the '! procuring entities and specialre"uirements of health goods, services and works, the generic procurement manuals
have been customi1ed to minimi1e variations and ensure that all concerned follow the
procurement law and related laws. 3or your reference and guidance are the four 4:5
customi1ed volumes0 olume $0 8uidelines on the #stablishment of -rocurement
Systems and rgani1ations9 olume $$0 8uidelines on the -rocurement 8oods9 olume
$$$0 8uidelines on the -rocurement of ivil Borks and olume $0 8uidelines on the
-rocurement of onsulting Services. Bith these, we hope to improve the efficiency and
effectiveness of our procurement systems, practices and processes.
(#y$nri7ue . 8na 5D."
Procurement o$ Consulting Ser#ices
These -hilippine &idding 'ocuments 4-&'s5 for the procurement of onsulting
Services through ompetitive &idding have been prepared by the 8overnment of the
-hilippines 48-5 to be used by all branches, agencies, departments, bureaus, offices, or
instrumentalities of the 8overnment, including government%owned andDor Econtrolled
corporations 48s5, government financial institutions 483$s5, state universities and
colleges 4S(s5, and local government units 4L8(s5. The procedures and practices
presented in this document have been developed through broad experience, and are for
mandatory use in pro2ects that are financed in whole or in part by the 8-, Borld &ank,
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or any foreign governmentDforeign or international financing institution in accordance
with the provisions of the $mplementing Rules and Regulations 4$RR5 of Republic Act
6C: 4R.A.6C:5.
The bidding documents shall clearly and ade"uately define, among others0 4a5 the
ob2ectives, scope, and expected outputs andDor results of the proposed contract9 4b5 the
minimum eligibility re"uirements of bidders, such as track record to be determined by the
!ead of the -rocuring #ntity9 4c5 the expected contract duration, delivery schedule andDor
time frame9 and 4d5 the obligations, duties, andDor functions of the winning bidder.
4he Phi%ippine #iddin- Documents, 6overnment of the Phi%ippines"
Transparenc% and Accountabilit% 5et(or: procurement monitoring
n January /@@7, it passed the RA6C: E 8overnment -rocurement Reform
Act provided for *8 observers to the procurement process. The procurement
monitoring is based on 8overnment -rocurement Reform Act 4RA 6C:5 and other
related 8--& issuances and it covers monitoring of competitive bidding, and alternative
modes of procurement. bservers report also provides guide on determining red flags and
utili1es documents such as Annual -rocurement -lan or -rocurement List 4including
Supplemental -rocurement5, $tems to &id, &id Results on ivil Borks, and 8oods and
Services, Abstract of &ids as alculated, etc.
(9incent . 'a:atin 2;
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nput Process "utput
P" -odel
P"
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A system application
that will improve
bidding or auctioning
method with the help
of the procurementprocess
3or #asy and efficient
service to all
7no(ledge Re=uirement
'atabase +anagement
-!-
So$t(are Re=uirement
+icrosoft isual Studio /@6@
+ySL
Adobe -hotoshop S;
Adobe $llustrator$nternet Beb &rowser
perating System
S%stem Anal%sis > esign
(ser $nterface
'ata 3low +odel
#ntity #vent +odel
Testing >Re#isions
'ebugging
(nit testing
-roduct testing
$ntegration testing
Acceptance testing
#nd%to%end testing
Hard(are Re=uirement
omputer Set with
$nternet onnection
nline &idding
System 3or ne
ommerce
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This chapter explains the conceptual model of a general system. $t is a table that
shows a program
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The last stage is the output. $t is the result of the processing based on inputs and
process identified during the actions taken by the researchers through the system
development of the study.
2.& "perational e$inition o$ terms
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System E bounded transformation process, that is, a process or collection of processes
that transforms inputs into outputs. $t can comprise multiple views. 3or the man%made
systems it may be such views as planning, re"uirement4analysis5, design,
implementation, deployment, structure,behavior, input data, and output data views.
'ata E 'istinct pieces of information usuallyformattedin a special way
of instructionsfor manipulating data.
nline E Anything done using the internet or on the web
Transaction E Transfer of data from one personDcomputer with another.
#ncode E $nput data to the computer.
$nputDoutput % is the communication between information processingsystem 4such as a
computer5 and the outside world.
Re"uest for uotation E A way of encouraging contractors to bid against each other in
certain items or products.
Re"uest for $nformation E A kind of the data which comes from the potential seller or
service provider that can determine the availability of products or services in the
marketplace
Re"uest for -roposal E A process of including information
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University of Perpetual Help System DALTACollege of Computer Studies
M$'S E Mnowledge in 'ata System
$D E $nputDutput
S E isual Studio
SL E Structured uery Language
+S E +icrosoft
R3$% Re"uest for $nformation
R3% Re"uest for uotation
R3-% Re"uest for -roposal
S E ollege of omputer Studies
(-S!' E (niversity of -erpetual !elp System 'alta