Chapter 5. Implementing electronic mechanisms to support Nuevo León's procurement system

This chapter discusses information technology (IT) tools and the public procurement system of the State Government of Nuevo León (SGNL). It focuses specifically on the availability of these tools, and how they can be utilised by Nuevo León’s public procurement system. The chapter analyses the degree of implementation of IT services, and their use in public procurement activities as compared to the recommendations set by the 2015 OECD Recommendation on Public Procurement. Furthermore, the chapter assesses how the use of an e-procurement system in the SGNL is bringing it closer to achieving some of the major objectives of public procurement, such as transparency and efficiency. Finally, the chapter addresses how the SGNL could further reap the benefits of the e-procurement system as well as data and information that could be collected through IT systems in order to improve the functioning of the public procurement system overall.


Governments around the world are increasingly incorporating information and communication technologies (ICTs) into their daily activities and operations. ICTs are also incorporated into public procurement processes through implementation of e-procurement systems.

E-procurement is an effective tool for improving administrative procedures, and, perhaps more importantly, it can also help officials uphold several principles that are central to public procurement. These core principles include transparency, access, efficiency, integrity and accountability. Implementation of a sound e-procurement system allows timely diffusion of information with lower transaction costs to relevant stakeholders. These stakeholders include: contracting authorities; tenderers; other suppliers in the market; oversight bodies, such as control and audit authorities; civil societies; and citizens. The use of ICTs can facilitate the participation of more suppliers, especially small and medium enterprises (SMEs), in public procurement processes. This occurs because e-procurement can give procurers and suppliers improved market access with reduced marketing costs. Increased competition helps governments find the goods, services and works they need. It can also result in better terms and conditions for procurers, and increased value for money of purchases. Over the course of the whole process, e-procurement systems also provide better traceability of information and higher transparency, which in turn enhance integrity and accountability of actors and the system as a whole. The OECD Recommendation of the Council on Public Procurement (henceforth referred to as the OECD Recommendation) recognises the diverse benefits governments can derive from harnessing digital technologies throughout their procurement cycles (Box ‎5.1).

Box ‎5.1. OECD Recommendation of the Council on Public Procurement

The Council:

VIII. Recommends that Adherents improve public procurement system by harnessing the use of digital technologies to support appropriate e-procurement innovation throughout the procurement cycle. To this end, Adherents should:

i. Employ recent digital technology developments that allow integrated e-procurement solutions covering the public procurement cycle. Information and communication technologies should be used in public procurement to ensure transparency and access to public tenders, increasing competition, simplifying processes for contract award and management, driving cost savings and integrating public procurement and public finance information.

ii. Pursue state-of-the-art e-procurement tools that are modular, flexible, scalable and secure in order to assure business continuity, privacy and integrity, provide fair treatment and protect sensitive data, while supplying the core capabilities and functions that allow business innovation. E-procurement tools should be simple to use and appropriate to their purpose, and consistent across procurement agencies, to the extent possible; excessively complicated systems could create implementation risks and challenges for new entrants or small and medium enterprises.

Source: (OECD, 2015[1])

The State Government of Nuevo León (SGNL) has begun taking steps to digitise its procurement processes. Some of these steps include online publication and digital storage of procurement information and increasing use of e-reverse auctions. As previously discussed, e-procurement systems could contribute to economic development in the state. E-procurement could make the system more transparent and efficient. Coupled with the economic power of central purchasing, e-procurement could help spur economic development. Furthermore, an e-procurement system could help Nuevo León build a more effective and transparent government. These two goals are core objectives of Nuevo León’s State Development Plan (Plan Estatal de Desarrollo) for 2016-2011, and the Strategic Plan for the State of Nuevo León 2015-2030 (Plan Estratégico para el Estado de Nuevo León 2015-2030). This chapter analyses the implementation of e-procurement systems in the SGNL. It then discusses ways in which e-procurement can result in diverse benefits, such as transparency, accountability, efficiency and performance management.

5.1. Developing informational e-procurement platforms that can better store and disseminate public procurement information

5.1.1. Increasing transparency of the public procurement system through the use of e-procurement

An adequate degree of transparency is essential to a well-functioning public procurement system. Because of this, many OECD countries have placed transparency at the heart of recent reforms of their public procurement systems. The 2013 OECD report, Implementing the OECD Principles for Integrity in Public Procurement: Progress since 2008 recognised this trend. The report described how many countries seek to ensure a degree of transparency “that does not impede the effectiveness of public procurement” (OECD, 2013[2]). In order to increase transparency, many countries have implemented e-procurement systems.

Publishing and disseminating public procurement information has been one of the main motivations for the implementation of e-procurement systems in OECD countries, including in Mexico. In 2016, the state of Nuevo León approved the Law on Transparency and Access to Information of the State of Nuevo León (Ley de Transparencia y Acceso a la Información Pública del Estado de Nuevo León). It extended the transparency and access to information law that was already on the books to more public agencies and institutions. This was a great step forward in terms of ensuring transparency in the public sphere. This reflected the changing perception on public information. As the anti-corruption NGO Transparencia Mexicana explains, “In Mexico, public information has increasingly been conceived as the property of citizens, rather than as a prerogative of politicians” (Transparencia Mexicana, 2012[3]).

At present in Mexico, transparency in public procurement has been widely recognised as “an effective deterrent to corruption” (Transparencia Mexicana, 2012[3]). Increased transparency ensured through the use of e-procurement systems enables oversight of public officials’ procurement decisions by more stakeholders. Thus, e-procurement systems provide greater accountability. The crucial role transparency plays in procurement systems is further described and also highlighted in the OECD Recommendation (Box ‎5.2).

Box ‎5.2. OECD Recommendation of the Council on Public Procurement

The Council:

II. Recommends that Adherents ensure an adequate degree of transparency of the public procurement system in all stages of the procurement cycle.

i. Promote fair and equitable treatment for potential suppliers by providing an adequate and timely degree of transparency in each phase of the public procurement cycle […]

ii. Allow free access, through an online portal, for all stakeholders, including potential domestic and foreign suppliers, civil society and the general public, to public procurement information […]

iii. Ensure visibility of the flow of public funds, from the beginning of the budgeting process throughout the public procurement cycle […]

Source: (OECD, 2015[1])

While the installation of an e-procurement system can increase accountability and oversight, it is not a cure-all. As the anti-corruption civil society organization, Transparency International, puts it, “the establishment of an e-procurement system as a stand-alone reform is unlikely to bring about positive transformational results. Transparency and accountability must be built into e-procurement specifications and design in order to allow for a meaningful analysis of the information generated” (TI, 2014[4]). In this sense, implementation of an e-procurement system should not be an end in itself. Governments must take measures to ensure that transparency, accountability and information analysis are built into all steps of the process, thus contributing to the sound functioning of the public procurement system overall.

Public procurement information recorded by the Electronic System of Public Procurement could be more clearly presented and made more easily searchable

Nuevo León’s Central Purchasing Body (Unidad Centralizada de Compras, UCC) centralises purchasing in the state, and conducts all public procurement processes of goods and services for centralised entities. It also conducts procurement of goods and services for some decentralised entities with which it has signed a cooperation agreement. The Electronic System of Public Procurement (Sistema Electrónico de Compras Públicas, SECOP) publishes information related to public procurement processes that are carried out by the UCC via open tender, restricted invitation, e-reverse auction and framework agreement.

The SECOP has the objective of: 1) disseminating relevant information to potential suppliers, such as calls for tenders, clarification meetings and minutes of procurement events; 2) being the means by which electronic procurement procedures are developed; 3) promoting transparency and monitoring of public sector acquisitions, leases and services; and 4) generating the necessary information that allows adequate planning, programming and allocation of the budget for public procurement and the creation of all reports related to the evaluations. In view of these objectives, the main webpage of the SECOP1 displays links to the following information (see Figure ‎5.1):

  • laws and regulations applicable to public procurement of the SGNL

  • current and past public procurement opportunities by open tender

  • current and past public procurement opportunities by restricted invitation

  • communiqués on framework agreements

  • e-reverse auction portal2

  • annual procurement programme

  • registry of studies

  • registry of suppliers

  • registry of social witnesses.

Figure ‎5.1. Display of the main page of the SECOP

Source: (State Government of Nuevo León,(n.d.)[5])

These webpages contain information related to all the public procurement processes that have been carried out since the implementation of the SECOP in 2016. Each page on public procurement processes provides the complete list of subjects related to each type of procedure, along with a set of documents in PDF format. This list contains specific information on the procurement process; the number of the process, which also indicates the year of the process; and a description of the process. The description of the process includes information on whether it was open to international participation, whether it was carried out in a physical way or electronic way, and a short description of the good or the service that was (or will be) procured. This list is also complemented with links to documents that are associated with each process. For instance, for all concluded open tenders, one can consult the SECOP website for information regarding: the call for tender, technical specifications, minutes from clarification meetings, the opening of the proposals, evaluations by the procurement committee and the final judgment and award notice.

The way the SECOP website presents information could be altered to better reflect what the SGNL wants to communicate to its stakeholders. Currently, the number of tender processes the SECOP publishes on line is relatively low compared to other national e-procurement platforms. Yet, it is still difficult for users to access the information they need without prior knowledge about a specific process. For example, in order for any party to look for information on a public procurement process, it needs to plug in which procedure was used to carry out the process. Furthermore, the interested party needs to know whether the process of interest has been awarded, as well as the year it was undertaken. Put simply, it is difficult for interested parties to search the website if they do not have prior knowledge. Thus, the SECOP website’s current layout does not facilitate access to information for those without information on specific processes. In light of these facts, the SGNL should consider what information would be of interest to its stakeholders, and how this information could be best communicated to them. For instance, some search functions and filters could be added to the lists of processes. In addition, some key information regarding the public procurement process overall could be displayed on the SECOP main page and on each page using PDF forms.

The SGNL could consider improving how it communicates annual procurement programmes

Publication of an annual procurement programme is obligatory for governmental entities in Nuevo León. Article 12 of the Law on Acquisition, Leases and Service Contracts of the State of Nuevo León (Ley de Adquisiciones, Arrendamientos y Contratación de Servicios del Estado de Nuevo León, LAASNL) stipulates that the annual procurement programmes of all governmental entities need to be made available on the SECOP and its websites by 31 January of each year. These programmes are meant to serve only as prospective references. They do not create any commitment, and can be modified with any additions, changes or by cancelation after informing respective procurement committees.

Currently, annual procurement programmes of 16 central government bodies are published on the SECOP. The programmes are published in PDF format, which can be consulted and downloaded directly from the platform. This way of displaying programmes only allows interested parties to search by individual entity and to look for the good or service of interest. Furthermore, the annual procurement programmes do not specify which year they correspond to.

The way the SECOP presents information needs to correspond to the communication objective of the information. For example, both government entities and suppliers rely on information provided by annual procurement programmes. These programmes help government entities plan their procurement activities for the forthcoming year and organise their spending in more structured and predictable ways. These programmes also possess crucial information for suppliers. Suppliers need this information in order to be informed about upcoming procurement opportunities so that they can organise bids. Thus, the presentation of information about annual procurement programmes needs to contain information that are useful both to government entities and suppliers.

Nuevo León’s current communication methods are not optimal, especially in achieving the latter objective of informing suppliers. Most suppliers do not know which entities need their goods and services. Furthermore, a one-year range (as delineated by the annual procurement programmes) is too broad for suppliers to plan effectively. In light of these facts, the SGNL could assess what information, and how much advance notice suppliers need to increase their participation and access to public procurement opportunities. During the OECD fact-finding mission to Nuevo León, shareholders asserted that certain suppliers approach government entities individually in order to understand their needs and upcoming procurement opportunities. This creates information asymmetry between public officials and suppliers, as well as among suppliers. In order to reduce this information asymmetry and facilitate and increase participation of suppliers, the SGNL should communicate better with all suppliers, not just the select few that have the means or drive to reach out in person. The SGNL can improve its communication by creating annual procurement programmes based on assessments of suppliers' needs. The Annual Procurement Plan List in the Australian Government procurement information system, AusTender, could serve as a model for these changes (Box ‎5.3).

Box ‎5.3. AusTender - Annual Procurement Plan List

AusTender, the Australian government procurement information system, provides suppliers one central point to find publicly available business opportunities and planned procurements advertised by the Australian government.

On AusTender, suppliers can browse annual procurement plans by agency, or search procurements by keyword, category, date of approach to market and/or agency. If, for example, a supplier sells office equipment, it can filter procurements by this category and then browse planned procurements across the government. Suppliers can also add procurements of interest to their AusTender “watch list” in order to receive updates and notifications.

Source: (Australian Government,(n.d.)[6])

As a long-term strategy, the SGNL could publish public procurement information from all governmental entities, including information from parastatal entities, on a single portal

In addition to the SECOP, the government of Nuevo León uses a few other channels to publish information related to public procurement opportunities. It is mandatory in the state that information related to public procurement processes that are not carried out by the UCC be recorded on the State Transparency Portal3. The information that gets recorded on the Transparency Portal is similar to the information available via the SECOP. In particular, the portal provides public procurement information by entity, including tender notices, direct awards of public works, purchase orders and e-reverse auction processes. While there are some key differences between the Transparency Portal and the SECOP, both follow very similar publication requirements. The complete list of information available at present via the Transparency Portal can be observed in Figure ‎5.2 The display method of this portal poses similar problems to those of the SECOP. Unless interested parties have information on a specific process, the display is not easy for users to navigate.

On the Transparency Portal, purchase order records are put together by each state government body and agency and published on a monthly basis. The equivalent of this information is not yet available on the SECOP. Certain data records available for download via the Transparency Portal contain different types of information per entity and are not presented in a uniform way.

The SGNL could consider developing a single portal through which all information related to public procurement can be accessed. Such a portal should include all information from central government bodies, as well as decentralised agencies. This could enable the government to better communicate procurement information. It would also foster greater transparency by allowing a larger base of stakeholders to access the system and gain knowledge about public procurement in the state.

Figure ‎5.2. The public procurement transparency portal of the SGNL

Source: (State Government of Nuevo León,(n.d.)[7])

5.1.2. Managing supplier information via the Unique Registry of Suppliers and Contractors (Padrón Único de Proveedores et Contratistas)

The registry should store information on suppliers and contractors using a structured, electronic format so as to decrease the amount of information it has to provide during each procurement process

For any potential suppliers to participate in public procurement, they need to be registered in the state registry first. In 2017, the SGNL launched the Unique Registry of Suppliers and Contractors (Registro Único de Proveedores y Contratistas, RUPC). The RUPC4 unifies the registration processes for suppliers of goods and services and suppliers of works. Previously, suppliers of goods and services were registered through Registry of Suppliers (Padrón de Proveedores), while contractors of works were registered through the State Registry of Contractors (Registro Estatal des Contratistas).

Under the current framework, suppliers and contractors complete their registrations on a single portal, providing general information including:

  • information on the legal representative of their organisation, legal identity documents and general information regarding the company, its address and their proof

  • federal taxpayer registration number and supporting documentation

  • declaration of economic activities

  • geographical location and photographic proof

  • résumé and previous experiences

  • certification

  • financial information based on annual declarations.

On the main dashboard, they can follow the progress of the registration.

RUPC registration is free; however, the amount of documentation that is required of suppliers and contractors to register and participate in state public procurement opportunities is quite substantial. Suppliers and contractors are given a registration certificate that allows them to participate in public procurement processes only once the registration is complete. The Secretariat of Administration reviews and validates the registration process for suppliers of goods and services, while the Secretariat of Infrastructure (Secretaria de Infraestructura) reviews and validates the registration process for contractors of works.

The SGNL should consider ways to lessen the administrative burden for suppliers and contractors once the registration is complete. For instance, the information suppliers and contractors provide within the RUPC could be stored in a structured format that is easily retrievable during public procurement processes. If contracting authorities, especially the UCC, could retrieve general information on each supplier from the RUPC, it could lessen the administrative burden both on suppliers and on public authorities. This is especially true with regards to having to verify the consistency of information during each process. If the SGNL chose to take steps to keep general information on each supplier easily available, it would also be important to ensure that this information was updated on a regular basis.

5.2. Increasing the efficiency of the public procurement system through the use of electronic mechanisms

In addition to facilitating storage and timely diffusion of public procurement information, integrating digital technologies into the public procurement function increases the efficiency of the system. This is the case because data technologies encourage standardisation and automation of procurement processes, as well as savings in terms of transactions, administrative costs and time. Furthermore, in many countries around the world, governments adopt digital procurement tools to increase efficiency. These tools, also acknowledged in the OECD Recommendation as increasing the efficiency of public procurement systems (Box ‎5.4), are increasingly provided on e-procurement systems in OECD countries.

Box ‎5.4. OECD Recommendation of the Council on Public Procurement

The Council:

VII. Recommends that Adherents develop processes to drive efficiency throughout the public procurement cycle in satisfying the needs of the government and its citizens. To this end, Adherents should: […]

iii. Develop and use tools to improve procurement procedures, reduce duplication and achieve greater value for money, including centralised purchasing, framework agreements, e-catalogues, dynamic purchasing, e-auctions, joint procurements and contracts with options. […]

Source: (OECD, 2015[1])

This section discusses how the SGNL could further increase efficiency of the public procurement system through existing e-procurement solutions, as well as electronic tools that the SGNL could further utilise for this end.

5.2.1. Setting strategic objectives for the e-procurement system

Implementing new electronic procurement tools should be linked to strategic objectives

After inheriting the current version of the SECOP from the previous administration of the SGNL, the current administration began to develop a 2.0 version of the SECOP. The new administration’s objective is to use the platform to unify, simplify and digitise the system for registration of suppliers of goods and services, as well as contractors. The administration also hopes to improve the SECOP in order to streamline public purchases and contracting in the state.

The SGNL is increasingly devoting efforts to reaping the benefits of the e-procurement system that go beyond transparency. For instance, the state government has expressed a desire to increase the efficiency of the public procurement system. The development of the e-procurement system in the SGNL supports this objective through simplifying and streamlining the procurement procedures. Colombia has made similar efforts (see Box ‎5.5). The SGNL should ensure that e-procurement developments are in line with the overall development plan of the state, and that e-procurement is not linked to one specific government administration. By doing so, it could ensure the continuity of the system – not only in the minds of public officials, but also for the suppliers that participate in public procurement process.

Box ‎5.5. E-procurement in Colombia

Colombia passed a law in 2007 that made it mandatory for every procuring entity to disclose documents related to procurement on an electronic webpage called the Electronic System for Public Procurement (Sistema Electrónico de Contratación Pública, SECOP). Following the passage of this law, interested suppliers could check the SECOP for business opportunities for free. This boosted competition in tender processes.

Colombia Compra Eficiente launched SECOP II in 2015. SECOP II is a fully transactional e-procurement platform conceived as an evolution of the first SECOP. On this platform, suppliers can create a profile and receive updates of new business opportunities. Interaction with procuring agencies is performed through SECOP II. Bids are submitted electronically, and data is disclosed in real time for any interested party. Modules for the publication of annual procurement plans and for contract management have also been included in the new platform. SECOP II improves overall efficiency as it increases competition and reduces transaction costs related to procurement processes. Furthermore, SECOP II operates in tandem with the budget system of the central government.

Note: SECOP II can be accessed through

Source: Information provided by Colombia Compra Eficiente

5.2.2. Use of e-procurement to cover the whole public procurement cycle

The SGNL could consider expanding its use of the e-procurement system to cover the whole public procurement cycle so as to reduce paper-based processes and support public procurement operations

Automation of the procurement process replaces face-to-face interactions by placing them on electronic platforms; this increases the system’s efficiency by reducing transaction and administrative costs, as well as time. Furthermore, replacement of processes requiring the physical presence of public procurement officials with automated electronic processes reduces the room for integrity breaches. Transactional e-procurement platforms that allow interaction with the system are thus highly useful to both contracting authorities and suppliers.

Most of the obligations regarding the use of e-procurement systems in the SGNL are related to the publication of information. Currently, public procurement processes in Nuevo León generally take place via face-to-face interactions not via electronic means (except for the cases of e-reverse auction).

Use of e-procurement systems is pervasive among OECD countries, though the degree of implementation varies. As is true with the SGNL, e-procurement systems in many OECD countries are most commonly used to publish and store public procurement information. The functionalities that are more often provided by OECD countries' e-procurement systems include announcing tenders, notifying suppliers of contract awards and providing tender documents. The functionalities that are related to transactional aspects of e-procurement systems – such as electronic submission of invoices, online catalogues and ordering – are provided by e-procurement systems in a minority of OECD countries. The grand majority of OECD countries simply use e-procurement systems to support electronic submissions of bids.

Figure ‎5.3. Functionalities provided in e-procurement systems of OECD countries (2016)

Source: 2016 OECD Survey on Public Procurement, unpublished.

OECD countries are increasingly making their e-procurement systems more transactional. For example, Canada, Israel and Slovenia have all announced plans to implement electronic submission of bids. Furthermore, the European Commission has developed initiatives to support the transition to an e-procurement system that covers the whole public procurement cycle for all European Union (EU) member countries. This move includes mandatory e-submission of bids in EU member countries by 2018.

Box ‎5.6. E procurement initiatives in the EU

The European Union has taken initiatives towards an end-to-end e-procurement system. Going beyond electronic tools, procurement digitalisation rethinks various pre-award and post-award phases with the aim of making procurement processes simpler for businesses to participate in and for the public sector to manage.

In achieving this end, the new rules on e-procurement in the EU are to be gradually introduced with the following timeline:

  • tender opportunities and tender documents will become electronically available by April 2016

  • central purchasing bodies should move to full electronic means of communication including electronic bid submission by April 2017

  • e-submission should be made mandatory for all contracting authorities and all procurement procedures by October 2018

  • more detailed provisions to encourage interoperability and standardisation of e-procurement processes are forthcoming.

Source: (European Commission,(n.d.)[8])

The SGNL could exploit opportunities to further digitise its public procurement operations. The state could take measures to accomplish this by digitising submission of requisition from the state government bodies and agencies to the UCC, ordering, invoicing and contract management. These processes are already recorded digitally, but they exist mostly in PDF format as scanned copies of documents. Replacing this paper-based process with digital technologies could, in particular, improve administrative delays and burdens on public officials and suppliers. It could also further standardise and streamline public procurement operations.

5.3. Use of the e-procurement system to support data collection, and the use of data to improve the public procurement system

A well-implemented e-procurement system enables and facilitates timely collection of comprehensive and reliable data. Statistical information on procurement using these data is essential in evaluating the policies and functioning of the system. The OECD Recommendation underlines the importance of “driving performance improvements through evaluation of the effectiveness of the public procurement system from individual procurements to the system as a whole, at all levels of government where feasible and appropriate” (OECD, 2015[1]). It further details that, in order to achieve this end, countries should “assess periodically and consistently the results of the procurement process. Public procurement systems should collect consistent, up-to-date and reliable information and use data on prior procurements, particularly regarding price and overall costs, in structuring new needs assessments, as they provide a valuable source of insight and could guide future procurement decisions” (OECD, 2015[1]).

5.3.1. Assessing the performance of the public procurement system

Automatically collecting and centralising public procurement data from the SECOP and other related systems according to a pre-defined performance framework could help the SGNL assess and evaluate the performance of its public procurement system

The SGNL's public procurement system has undergone a significant reform. This reform focused not only on institutional changes, but also on how the public procurement function was viewed in the state. Previously, the procurement process was viewed as an administrative “tick-the-box” exercise. The reform allowed the SGNL to implement various measures to transform public procurement into a strategic tool. These measures aim to help procurement officials make efficiency gains and create value for money, as discussed in previous chapters. While this transformation is still underway, it is of utmost importance that the SGNL collect meaningful data and use them to assess the performance of the public procurement system.

Currently, the SECOP does not contain functionalities that allow for automatic aggregation of data. Rather, data are rather collected on manual basis in Excel files. At the same time, the SECOP includes a registry of studies. This registry is supposed to include studies based on data and information collected through electronic means. However, no reports or studies have been generated with data collected through the e-procurement system. The registry only lists one study. It is called the Consultation on Preparation of the State Development Plan, and is listed as published in January 2016. That said, the study is not accessible via Internet (Figure ‎5.4).

Figure ‎5.4. SECOP's registry of studies

Source: (State government of Nuevo León,(n.d.)[9])

OECD countries increasingly use the data that are generated through e-procurement system in order to assess the performance of their public procurement systems and to communicate information about their systems to different stakeholders. This means that these systems cannot be not limited to internal use by their governments. Countries increasingly publish data in order to communicate with the diverse stakeholders of the public procurement system, including potential suppliers, civil societies, academics and citizens. The case of Korea’s public procurement data system (Box ‎5.7) provides an example of such use and the communication of public procurement data.

Box ‎5.7. Korea's public procurement data system

Almost 70% of public procurement transactions in Korea occur via the Korean On Line E-Procurement System (KONEPS). The remaining transactions, including defence procurement, procurement transactions by other public enterprises that use their own e-procurement systems and some manual transactions, are not currently practised in a centralised way. In 2013, Korea’s Public Procurement Service (PPS) launched the Public Procurement Data System to close this gap. The project aims to provide policy makers and citizens with complete procurement transaction data across the entire public sector in order to enable a better understanding of the procurement market. The project also includes an analytical study of policy results.

Proper legal authority for the project was established by modifications made to existing procurement laws, including the Government Procurement Act (July 2013) and the Enforcement Decree on the Government Procurement Act (January 2014). These modifications gave the PPS the legal authority to request data, and to establish deadlines for government agencies to submit the requested procurement data.

Total public procurement in Korea encompasses procurements that occur in both electronic and non-electronic ways. Electronic procurement is carried out on KONEPS and 23 other electronic procurement platforms for specific procuring entities. Thus, data integration includes linking of the 24 e-procurement systems, as well as central collection of manual records. A report will be prepared to present the data collected per government bodies, companies, and projects. Data will also be presented in infographics in order to facilitate end user comprehension.

The data integration faces some difficulties due to administrative burdens that affect approximately 28 000 government agencies. Delays in concomitant projects in some government agencies to improve their electronic systems, which were intended to facilitate the data integration, can also slow progress. In order to alleviate the administrative burden on the collection of manually kept data, the Korean government is discussing linking data integration to other financial information systems, including the Educational Financial System, the Local Government Budget and Accounting System, the Local Pubic Enterprise Budget and Accounting System and the National Budget and Accounting System. Additionally, some difficulties have arisen due to the disparity of the information collected at each government agency and across different e-procurement systems. In response, the government provided new code mapping to agencies where data were collected by different standards.

Provision and publication of data statistics on total public procurement on a monthly and annual basis, and 103 specific reports based on the data, are expected to increase the availability of data for companies and the public. It is the hope of the Korean government that the availability of these data will enhance government and budgetary transparency. The reports will be made available on line.

Source: (OECD, 2016[10])

The SGNL could consider making further use of public procurement data and information in order to assess the functioning of its public procurement system. This would necessitate identifying a performance framework for the SGNL's public procurement system. According to this framework, the SGNL could then define the areas where collection and aggregation of data is needed. As acknowledged in Chapter 2, the Secretariat of Administration is defining a set of key performance indicators for the public procurement system. These indicators would provide a performance framework against which the state’s public procurement system could be assessed according to certain objectives and priorities. Colombia’s development of key performance indicators for its public procurement system (Box ‎5.8) could provide some insight. In developing Nuevo León’s framework, the communication between different authorities – including those who define the indicators and those who manage the IT system – would be crucial. The reason for this is that all parties must have a common understanding of the objectives and priorities of the system, as well as the administrative implications and any questions of feasibility.

Box ‎5.8. Key performance indicators of the public procurement system of Colombia

11 key indicators across four key target areas

Along with the development of SECOP II, Colombia's current e-procurement, Colombia has recognised the importance of developing key performance indicators that can be derived from information available within SECOP II and other related systems. 11 key indicators across four key target areas have been identified and defined.


What does it measure?


Value for money

Opportunity of the contracting process

The level of budgetary commitments in a fiscal year

Ratio between the commitments and the appropriation during the fiscal year, which does not include staff costs, budgetary transferences and debt expenses

Changes in value according to specifications

The variation in the value of the contracts between the initial value established in the tender documents and the final value awarded

Average difference between the estimated value of the selection and the final value of the contract

Average time of the selection process according to the award mechanism

Difference in time of the selection process by award mechanism

Period of time between the signature date of a contract and the starting date of the process

Integrity and transparency in competition

Average of new contractors

Percentage of new contractors in a public entity regarding the former year

Ratio of new contractors of a public entity to the number of contractors working in the public entity in the previous year

Concentration of the contracts’ value by contractor

The concentration of resources by contractor that perform for a public entity through public procurement

Concentration of a public entity’s budget by contractor measured by the Gini coefficient

Percentage of contracts awarded to plural bidders

Frequency of awarded contracts to plural bidders by a public entity

Ratio of the contracts and the value of the contracts awarded by a public entity to plural bidders

Percentage of contracts awarded in non-competitive processes

Percentage of public contracting that is done under non-competitive processes

Percentage of awarded contracts without a competitive process, not including inter-administrative contracts, reserve spending of the defence sector and professional services


Percentage of public entity users of the SECOP

SECOP use by the public entities that are obligated to use it

Percentage of public entities using the SECOP

Percentage of public entities that publish their annual acquisition plans on the SECOP

The progress in the compliance of the publication of the Annual Acquisition Plan on the SECOP

Percentage of public entities that publish their Annual Acquisition Plan every year on the SECOP

Percentage of publicity of the contracting processes in the SECOP

The level of publication on the

SECOP of the contracts signed in a fiscal year

Percentage of the value of the procurement processes that a public entity publishes on the SECOP

Risk management

Percentage of contracts with modifications in time or value

Proportion of contracts modified after their signature regarding the total of contracts done by a public entity

Proportion of contracts modified in the value or in the duration of their performance after their signature

Source: (OECD, 2016[11])

5.3.2. Use of data to improve the public procurement system

Analysing historical public procurement data and annual procurement programmes could help the UCC better manage public resources spending and exploit opportunities for efficiency gains

As discussed in previous sections of this chapter, publication of procurement plans not only benefits suppliers by informing them and helping them prepare for upcoming procurement opportunities. It also aids public authorities to better plan their spending activities.

Current annual procurement programmes used in Nuevo León include the product or service code, a description of the good or service, the procuring unit and a quantity. These programmes are available on the SECOP in PDF formats. They are not binding, and state government bodies and agencies can modify them throughout the year. The Administration and Communication Headship of the Ministry of Administration is responsible for collecting projects for annual procurement programmes from various agencies and administrative units of the state government. However, during the OECD fact-finding mission, officials asserted that insufficient analysis was carried out on annual procurement programmes.

In addition to considering how the government communicates with shareholders about annual procurement programmes, the SGNL needs to think about how annual procurement programmes could be used to improve the public procurement system. Together with historical data on public procurement spending, they could be further analysed to explore more consolidation opportunities. These programmes could also be used to monitor gaps in terms and conditions, especially prices, of similar goods and services. Furthermore, in cases where a relatively high number of changes are made to annual procurement programmes, the UCC could provide guidance to help the government bodies and the agencies plan their purchases. Such guidance from managers could also help officials within the UCC have more predictability with their work flow.

Detailed management of product and service categories could further help the SGNL bring value for money to public procurement

Interviews carried out during the OECD’s fact-finding mission identified some hesitation among suppliers to register with the RUPC. One main reason was that suppliers believed the government offered an uncompetitive business relationship in comparison to the market – mainly because of delayed payments. Sometimes, decentralised agencies in Nuevo León have their own lists of suppliers who are not registered with the RUPC. Agencies use these suppliers because they can offer more competitive terms and conditions for the goods and services being procured. In order to ensure sound functioning along with the centralisation of public procurement, the UCC needs to be able to establish competitive terms and conditions between the state government bodies and agencies that they procure for, and the suppliers. More detailed management of product and service categories through the e-procurement system, and improved data collection could aid the SGNL to achieve this end.

Collecting data in a more structured and systematic way, as stressed in this chapter, could help the SGNL identify the types of procedure that are more suitable for each product and service category. Data collection could also help the SGNL establish more competitive prices. In order to do so, information needs to be managed by different product and service categories. Subsequently, public procurement authorities could be assigned to manage, accumulate and further develop knowledge according to established product and service categories. Furthermore, the SGNL is currently developing an e-catalogue module on its e-procurement system to support purchases of goods and services of smaller value. For this development, it would be crucial to have a sound understanding of the market, as well as the needs of the government bodies and agencies for each product and service group.

5.4. Proposals for action

The SGNL has made important progress in the use of electronic mechanisms to support public procurement processes. Publication of public procurement information through the SECOP has increased transparency of the public procurement system. Despite these advances, however, this chapter has discussed the SGNL’s lack of strategy with regards to communicating information on the e-procurement system. This is important, as the SGNL needs to make diverse public procurement information available to various shareholders via this platform.

In addition to transparency, the SGNL is also exploring further opportunities to gain efficiency through e-procurement systems. The state government has unified suppliers' and contractors' registration processes and started developing e-catalogues. Data collection in a structured and automatic way could help the SGNL increase the efficiency of the public procurement system. In particular, it would be crucial for the SGNL to use data to assess the functioning of the public procurement systems in a more sustained way.

In this regard, the SGNL could consider undertaking the following actions in order to reap certain benefits from using electronic mechanisms:

Develop an informational e-procurement platform that can better store and disseminate public procurement information

  1. Increase transparency of the public procurement system through the use of e-procurement

    • Public procurement information recorded on the SECOP could be more clearly presented and made more easily searchable.

    • The SGNL could consider improving how annual procurement programmes are communicated.

    • As a long-term strategy, the SGNL could publish public procurement information of all governmental entities, including that of parastatal entities, on a single portal.

  2. Managing suppliers' information: The Unique Registry of Suppliers and Contractors

    • The registry should store information on suppliers and contractors in an electronic and structured format so as to decrease the amount of information requested for each process.

Increase efficiency of the public procurement system through the use of electronic mechanisms

  1. Set strategic objectives for implementation of the e-procurement system

    • The implementation of new electronic procurement tools should be linked to strategic objectives.

  2. Use e-procurement for the whole public procurement cycle.

    • The SGNL could consider further use of e-procurement system to cover the whole public procurement cycle so as to reduce paper-based processes and support public procurement operations.

Use e-procurement system to support data collection and the use of data to improve the public procurement system

  1. Assess the performance of the public procurement system

    • Automatically collecting and centralising public procurement data from the SECOP and other related systems according to a pre-defined performance framework could help the SGNL assess and evaluate the performance of its public procurement system.

  2. Use data to improve the public procurement system

    • Analysing historical public procurement data and annual procurement programmes could help the UCC better manage public resource spending, and exploit opportunities for efficiency gains.

    • Detailed management of product and service categories could further help the SGNL bring value for money to public procurement.


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European Commission((n.d.)), E-procurement, (accessed on 15 September 2017).

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