e-Procurement use in the South African construction industry

Abstract

The advent of internet technology has resulted to increasing use of e-Commerce applications, particularly e-Procurement systems in supply chain management by firms across the different industrial sectors. However, there is a paucity of empirical studies on e-Procurement use in the construction sector of African countries. This study therefore investigated the use of e-Procurement in the South African construction industry. The data were derived from an online questionnaire survey involving 603 respondents and interviews with seven experts conducted in South Africa between March and July 2014. Descriptive statistical and content analyses were used to analyse the data. Findings show that the four categories of e-Procurement used were e-mail, static websites, web.2.0 technologies and portals that have capabilities of supporting the execution of functions limited to intra and inter firm communication and exchange of project information and data. Consequently, between 11 percent and 12 percent of the respondents used these e-Procurement technologies for communication of information, exchange of bill of quantities, CAD drawings and project specifications. Whereas the factors with the highest positive impact on the use of these technologies in the firms were the speed of transactions, lower transaction cost and ease of use; unreliable IT infrastructure, established cultures and security concerns were the main impediments to the uptake of these e-Procurement technologies in the South African construction industry. The study implies that construction firms in South Africa predominantly use e-mails and websites to support the execution of pre-award phase of construction procurement; and that the factors that affect the adoption of these e-Procurement technologies in the South African construction industry can be explained using Rogers’s diffusion of innovation theory. It also implies that in addition to technological issues, culturally related challenges are hampering the adoption of e-Procurement in the South African construction industry. The study suggests that to accelerate the rate of uptake of e-Procurement and maximize its benefits in the South African construction industry, there is a need to improve the quality and quantity of ICT infrastructure across the country; and to embark on aggressive enlightenment campaigns, training and skill development programmes in the use of e-Procurement in the construction industry in this country. It also suggests that future studies be carried out to identify how the existing e-Procurement technologies and tools can be innovatively used to suit the needs of the construction sector and people of diverse cultures.

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