Cathay Pacific Airways Assignment-2 Questions

1.What are the benefits of the e-procurement systems for the Airlines Purchasing Department?

Amongst all benefits some of the top benefits for e-procurement for the airline purchasing
department are:

 There would be better information about spending that could be catalogued and there would
be an enhanced criteria and presentation of data that would allow us to select better
suppliers. Since the supplier information is successfully structurally managed the process
would increase in efficiency as the accuracy increase
 Efficient process of sourcing would allow us to increase value and allow us to meet individual
and department wise requirement that will also be accessible
 Enhanced visibility in the market along with better management of price both purchase &
procurement and the exact management time as there would be a real time management of
information this will improve how ordering can improve as the cycle time and management
improves

2. Mention the concerns of key managers in Cathay Pacific regarding the e-procurement system
implementation?

 Absence of inventory function as in the previous version of the supported e-procurement

systems along with the integration of EMPACS and FMIS with the traditional system
 It would be a difficult process to sit with the suppliers and other stakeholders and negotiate
with them to streamline their and our systems for higher efficiency. Similarly, there would be
a problem while asking the internal departments of our company to streamline and
collaborate with each other and the company
 One of the critical problems being restocking problem being in capacity within same and
different product categories
 It would be a time-consuming job for everyone and additionally there would also be a problem
in managing the approval framework for the indexes and spend limits
3. What kind of financial metrics can be used to quantity the benefits?

 Money
o The decrease in the administration cost will allow strategic financial management and
diversion towards more important task
o Strong negotiation relationship with suppliers will allow a balanced distribution of
power
o Similarly allowing the employees to focus on strategic activities rather than redundant
one will create strong revenue opportunities

 Time
o Streamlined information process and activities will allow better and improved
information management
o Cutting back on cheque cycle time
o Adherence to policies, indexes and contracts will improve organisational and external
compliance

4.How can Cathay’s e- Procurement strategy contribute to its mission?

 Streamline all the departments with decentralising along with the process and automate all
redundant tasks such as requisition and procuring processes
 Centralisation of budget and optimal allocation while collaborating with different department
heads
 The two strategies will allow to reduce administration cost and allow the system to work
efficiently
 Streaming the compliance operation between supplier with contracts, reducing the amount
of time for cheque cycles and organising policies over spending limit and indexes will allow
better will allow better supplier relationship
 Creating and adopting new systems can allow more employees to not focus on redundant
activities but will allow them to pursue important and strategic tasks