Buying successes put states online

Buying successes put states online

But procurers and contractors still have wet e-feet on details

By Claire E. House
GCN Staff

Over the next six months, Massachusetts will move its Multi-State EMall from an online procurement pilot to a full-produc- tion buying system.

Through the yearlong pilot that ended Sept. 30, the commonwealth tested the viability of aggregated, electronic government buying. While demonstrating technological efficiency, it also showed that both governments and suppliers are still finding their footing in the electronic commerce arena.

In addition to Massachusetts, four other states'Idaho, New York, Texas and Utah'participated. In all, the five states generated $386,000 in sales of goods and services using one another's contracts. New York has signed on to participate in the system, said John Harrison, Massachusetts spokesman and supplier coordinator.

Technically, the program worked, Harrison said. Buyers and sellers met through the project's Web site, at emall.isa.us. Science Applications International Corp. of San Diego developed EMall, choosing IEC Enterprise from Intelisys Electronic Commerce LLC of New York as the software engine. Motorola Inc. provided digital certificates.

None of the pilot participants tied major accounting or buying systems to EMall; they just rekeyed any necessary data. Almost all buys were made through electronic purchase orders, although the system will process procurement card transactions, Harrison said.

Buying by rules

Suppliers and buyers tapped into the system using the Open Buying on the Internet standard, a set of business and technical rules developed by a nonprofit consortium promoting Internet commerce.

OBI has two pluses, Harrison said. The first is that the data owner, either a supplier or buyer, maintains its own data.

That keeps data accurate and timely, eliminating the need to send out updates for, say, a new contact name, because that data would come through automatically in the course of a transaction, said David Liggett, chairman of the OBI specifications working group and member of the OBI board of directors.

Secondly, OBI keeps the free enterprise in e-commerce by letting suppliers differentiate themselves rather than be lumped together, Harrison said.

On the downside, buyers often had to route from one supplier site to another to compare prices, which some participants found cumbersome, he said.

Idaho's participating agencies found the process'which was paperless except for check payment'easier than paper buying when everything worked as intended, Purchasing Division administrator Jan Cox said. They did find, however, that grinding through different state and supplier processes required some time and effort, he said.

Suppliers are still finding their e-commerce bearings, as well. For example, Idaho had some difficulty buying from a Massachusetts contract because the company was organized by region and a different office was responsible for Idaho sales. The company eventually figured out how to process the order.

'If this becomes a large-volume setup, that is something that is going to have to be worked out very carefully,' Cox said.

Ultimately, accepted standards will likely evolve for look, feel and navigation of e-commerce elements such as online catalogs, Harrison said.

Still other technologies will enhance EMall. Massachusetts is looking into use of the Extensible Markup Language to add system functionality such as cross-catalog searching. To attain the most effective cross-catalog searching, however, suppliers will likely need to adopt a standard such as the UN/SPSC open global product classifications recommended by the OBI consortium, Liggett said.

Next for Massachusetts is tying its major accounting and buying systems to EMall. It will offer technical suggestions to those interested in doing the same.

Organizers found that the success of joint procurement hinges on the laws, procedures and buying culture of each state.

'That wasn't news to the founders of the EMall, but the impact was something that had never been explored,' Harrison said.

For example, Massachusetts has a reciprocal buying policy for competitively bid government contracts. Idaho, which was granted reciprocity for pilot contracts, would require legislative permission to carry it over in a full-production system. It will likely ask for reciprocity in 2001 as part of a purchasing reform plan, Cox said.

Back and forth

The evolution of aggregated buying, however, remains to be seen. If the states want to combine buying power, they will have to figure out how to consolidate requirements and bidding, Cox said. If each is still bringing its contractors to the site, the states will not be able to get the best possible pricing, he said.

'It's one of those things that would be wonderful if we could do it, but it could be one of those things that just gets too complex and dies under its own weight,' Cox said.

One bellwether is the increased commercial interest in systems supporting government online buying. Five of Massachusetts' EMall project leaders, including the comptroller and deputy state purchasing agent, left the state in the past year to develop a comparable system for American Management Systems Inc. of Fairfax, Va.

'That to us spells success because it means that yes, in fact, we've hit a need and this did not just sound good on paper,' Harrison said.

Cox lauds EMall as a tremendous concept that has prompted much interest but said Idaho is still keeping an eye out for other ideas.

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