IT Makes Karnataka State Procurement Process Transparent

In a country like ours, where the government often kicks off large-scale initiatives, it has been seen that corruption and bureaucracy that have seeped into all levels of functionality in the system, often spoil the broth and lead to slower realisation of projects and in turn of the benefits that citizens may enjoy from the same. Having said that, we have to admit that IT is changing these age-old practices and giving the government a chance to put up a fresh, new face before citizens.

Biztech2.com brings to you one such success story where inclusion of the best practices in IT in a public sector undertaking (PSU) has led to greater transparency and fast approval and movement of tenders and contracts.

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It all started way back in 2003 when the then government of Karnataka chalked out an effective e-governance plan for better governance and ‘procurements’ was one of the areas identified for revamp. For this initiative, the government floated an RFP (request for proposal) and after a long-drawn process of checking the bids and identifying the best partner, HP was finally selected. The government was facing a lot of challenges with respect to the procurement process.

“Initially, the government carried out a slew of strategy workshops to identify the problem areas, which needed to be reworked. During the course of these workshops, it was realised that making the process of ‘Public Procurement’ efficient and transparent needed immediate attention,” says Jayraj P, project director, e-Procurement, HP India.

The public procurement process was in a mess and was asking for a reform in many areas. Due to non-transparency, the contractors and suppliers along with the officials in the procurement process, had built a nexus, which meted out a preferential treatment to some bidders. Malpractices were a common sight too and as expected the e-procurement process was met with stiff resistance from both contractors and officials in the government.

The implementation started in 2007 and is based on a similar solution that HP had implemented in Japan. An end-to-end e-procurement solution, it has been implemented on a Public Private Partnership (Build, Operate, Transfer) model. To start with, the government decided to inculcate the PWD, Sarva Shiksha Abhiyaan, Karnataka Drug Logistics Warehousing Society and Center for eGovernance in the project. All the agencies who are involved in the procurement process viz. contractors, suppliers etc need to sign-up to login to the interface and pay a transaction fee, which gets delivered to HP.

Incidentally, this is also one of the first pay-per-use models being implemented by the government. “The government gets this solution at practically no cost as the suppliers pay for the transaction,” says Jayraj.

The whole process of tendering, bidding, selecting the right contract and bidder is now carried out online. Performance of the supplier right up to the delivery of goods is also monitored online.

The project is hosted at the database and storage servers provided by the government, while the application servers (32 bit Intel-based HP Blade servers) are provided by HP. “This being one of the largest end-to-end e-Procurement deployments in the country, the project demanded creation of a single, comprehensive platform that is scalable, reliable and also manageable,” says Jayraj.

The implementation was first tested with a pilot project for one of the departments for a duration of six months. HP realised that the solution needed to be tweaked a bit to suit the government’s requirements. Subsequently, the solution went live for other departments.

One of the challenges that HP faced during the implementation process was connectivity to remote areas. “The government’s procurement process involves departments, which operate in remote locations, for example, PWD. Procurements in such scenarios happen in field offices and offering them connectivity to the solution was a big challenge,” says Niranjan DelaVictorie, country head, EDS India Marketing.

Apart from that, providing training to users and getting them comfortable with the solution, in addition to overcoming the resistance from rogue officials, was also a deterrent.

Once the government went live with the solution, the benefits were immediate. Earlier, it had to shell out close to 30-40 percent in premiums as compared to what it does now. Also, public money is being rightly used now and soon there are plans to make all the details of procurement transactions accessible to citizens.

“In a typical scenario, the government official in charge would open the tenders, evaluate the same, and then travel to the state capital to get an approval. This would ideally take anywhere from 30-60 days while now the whole process gets wrapped up in a matter of two to three days. We have been able to greatly reduce the turnaround time,” says Jayraj.

Also, as all records of transactions are now maintained online, this percolates to huge savings in terms of maintaining those records manually and the workforce needed for these jobs.

In future, the eProcurement solution would be integrated with the state treasury ‘Khajane’ to help directly debit any payments to be cleared. Also, there are immediate plans to integrate it with other information management systems, ERP systems and inventory.

Inclusion of IT in governance can surely pave the way to weed out the totalitarian authority that babus have enjoyed all this while in government functions and help make the latter accountable to the exchequer.