1.

The basic concept of procurement, which is to supply resources required for managerial
activities in a more economical and effective way, is the same both for the public and private
sector, but what is different in government procurement is that the financial resource to purchase
public goods for the public activities of a nation mainly comes from the taxes collected from its
citizens.KONEPS is aiming to

establish a nationwide web-based procurement system, dealing with whole procurement process
including acquisition of all the information on the national procurement projects, procurement
request, bids, contracting and payment for public organizations and private firms registered with
KONEPS. KONEPS handles all procurement works electronically, thus eliminating any room for
possible corruption scandal by getting rid of supplier's unnecessary visit to public office.
Opening the procurement information on website ensure the highest level of transparency and
fairness in procurement administration. how Korea has increasingly incorporated sustainable
procurement principles into procurement policy, attempting to foster innovative and
environmentally friendly companies, as well as those led by individuals belonging to socially
disadvantaged groups. The chapter concludes with a discussion of some of the historical and
organizational factors underlying Korea’s successes in public procurement in order to better
understand the extent to which currently developing countries can draw upon the Korean case to
improve their own procurement-policies.

2. The benefits brought forward by KONEPS:

● (Growth into the world’s largest government e-Marketplace) Through such efforts, starting
from the commencement of the service in Oct. 2002, to developing various contents, amending
laws, etc., KONEPS quickly became widely used as a single window. - (Transaction amount) As
of the end of Dec. 2015, KONEPS accounts for 67% (USD 74.56 billion) of the Korean public
procurement market (USD 111.9 billion) - (Supplier users) 50 thousand user entities and 320
thousand suppliers are registered with KONEPS to use procurement services

● (Significantly improved efficiency of government procurement) The greatest achievement of

implementing KONEPS is the enhanced efficiency of procurement by enabling the whole
process to be digitalized and reducing time and money spent by suppliers and public entities. -
According to a study conducted in 2008 by Hanyang University in Korea, KONEPS’s electronic
procurement services save about 8 billion dollars annually. Among the 8 billion dollars, the 6.6
billion dollars was the amount saved from the private sector and the remaining 1.4 billion dollars
from the public sector. The saving effect from the private sector was mainly due to a reduction in
time and money spent through personal visits, while the saving effect from the public sector was
owing to a reduction in administrative costs from enhanced work efficiency, the reduced amount
of paper documents used, etc.
 (Saving Effect of KONEPS by Public/Private Sector and Procurement Category)

In the past, suppliers had to apply for a bid published by a public entity and then later visit the
entity to submit their bids. Now, however, they are able to check tender notices on the KONEPS
system and simply electronically submit their bids in time, which will not take more than a
minute. ⇒ In the case of public entities, it used to take more than 30 hours to review bidding
documents to select a winning bidder. However, using KONEPS, the same process takes them
less than 2 hours. - Before KONEPS, suppliers had to spend 100 to 300 dollars annually to
obtain their credit rating certificates and additional costs had to be made such as issuance fees
required documents for bid participation and transportation costs when visiting related entities,
etc.

3. Transparency: Decrease face-to-face contract and Provide real-time information.

It is possible to prevent in advance procurement public officials from making arbitrary
interpretations of complicated contract-related provisions and to provide predictable procurement
services.

Saving budget: Commonage system for public enterprise

Also, it is possible to disclose to the public in real time each bidding process from bidding
notice to evaluation and selection of the successful bidder. Suppliers do not need to check every
notice announced by each public agency, but simply see the comprehensive information on
KONEPS and participate in any ongoing public biddings in Korea.

Efficiency: Electronic and automatic process of entire procurement

KONEPS significantly enhanced the administrative efficiency of procuring agencies and

suppliers’ convenience through linkage between various procurement data and automated
processing of the data without requiring to submit any paper documents. Once documents are
submitted, they can be reused by other agencies and for other biddings, so suppliers do not need
to get reissued the same documents every time. With the supplier’s consent, online confirmation
can be made through the linkage between the related agency systems.

So, these features of KONEPS can be implemented in Bangladesh’s public procure system.
4. My opinion of implementing blockchain will make their system more efficient. There are
some reason of that:

 Greater transparency: Transaction histories are becoming more transparent through the
use of blockchain technology. Because blockchain is a type of distributed ledger, all
network participants share the same documentation as opposed to individual copies. That
shared version can only be updated through consensus, which means everyone must
agree on it. To change a single transaction record would require the alteration of all
subsequent records and the collusion of the entire network. Thus, data on a blockchain is
more accurate, consistent and transparent than when it is pushed through paper-heavy
processes. It is also available to all participants who have permissioned access. To
change a single transaction record would require the alteration of all subsequent records
and the collusion of the entire network. Which can be, you know, a headache.

 Enhanced security: There are several ways blockchain is more secure than other
record-keeping systems. Transactions must be agreed upon before they are recorded.
After a transaction is approved, it is encrypted and linked to the previous transaction.
This, along with the fact that information is stored across a network of computers instead
of on a single server, makes it very difficult for hackers to compromise the transaction
data. In any industry where protecting sensitive data is crucial financial services,
government, healthcare blockchain has an opportunity to really change how critical
information is shared by helping to prevent fraud and unauthorized activity.

 Increased efficiency and speed: When you use traditional, paper-heavy processes,
trading anything is a time-consuming process that is prone to human error and often
requires third-party mediation. By streamlining and automating these processes with
blockchain, transactions can be completed faster and more efficiently. Since record-
keeping is performed using a single digital ledger that is shared among participants, you
don’t have to reconcile multiple ledgers and you end up with less clutter. And when
everyone has access to the same information, it becomes easier to trust each other
without the need for numerous intermediaries. Thus, clearing and settlement can occur
much quicker.

 Reduced costs: For most businesses, reducing costs is a priority. With blockchain, you
don’t need as many third parties or middlemen to make guarantees because it doesn’t
matter if you can trust your trading partner. Instead, you just have to trust the data on the
blockchain. You also won’t have to review so much documentation to complete a trade
because everyone will have permissioned access to a single, immutable version.