State-of-Practice of E-Commerce Application in the Construction Industry

Standardization is an extremely important area that will require review and modification accordingly. This area has two primary aspects for review: business processes and information technology systems integration.

1. Business processes will need to be reviewed in relation to the procurement aspects that are subject to automation and therefore subject to a change in work process.
2. Information technology systems will need to be reviewed to ensure they are (or can be) integrated to meet the needs of the changing business processes. Many large ERP solutions may lack the ability to accept a new interface or in the instance where they do accept the interface it may be found that future updates are severely hampered.

Expecting the e-Commerce tool to “magically” resolve inadequate or unmodified work processes or IT tools will not yield the desired benefit. (RR180-11, p. 67)

This is a rapidly changing area and the construction industry as a whole lags the manufacturing industry, which has had success with e-Commerce platforms, by 10-20 years. As technology changes and the adoption rate increases more updates will be necessary. There were no best practices available at the time of this research since e-Commerce was too immature to have any actions or processes as a “best practice.” (RR180-11, p. 99)

e-Commerce cannot to be dismissed as a fad.

Relationships are an important aspect of the buyer/supplier relationship and it is necessary that any IT-based solution still allow the human interaction. This can be accomplished by including the suppliers in the scoping, design, and implementation phase of the e-Commerce solution as well as engaging suppliers more strategic activities requiring face to face interaction such as long-term contracting strategies. (RR180-11, p. 98)

Describes how four companies in the construction industry have implemented e-procurement initiatives. Case studies examine topics that include: (RR180-12)

• Deployment strategy and metrics
• e-Procurement of catalog-type items
• Reverse auctions
• Private third-party exchanges

RR180-11, E-Procurement Scorecard

A robust scorecard of performance measures is essential for monitoring key drivers of e-procurement adoption, and ultimately at improving e-procurement adoption. A scorecard captures actual results and key performance metrics related to the progress and success of a particular program. Scorecards are frequently used to assess the status of the project over time and across comparative categories of performance.  (RR180-11, p. 90)