Abstract
Background: The South African public sector uses procurement and supply chains to address service delivery mandates. This approach must be based on a system that is inclined to ‘value for money, open and effective competition, ethics and fair dealing, accountability and reporting, and equity’. The current system is plagued by biasedness, poor record handling and insufficient contract administration.
Aim: The study aimed to link the Internet of Things (IoT) and cloud computing with sustainable public procurement and supply chain management (SCM). Furthermore, the study investigates how Industry 4.0 technologies can improve process efficiency in public procurement.
Setting: This study focuses on public procurement within the South African context.
Methods: The study followed an exploratory qualitative methodology approach. Data were collected by one-on-one interviews and analysed through ATLAS.ti 24 following a thematic analysis approach.
Results: The research revealed that IoT and cloud computing bring sustainability, stability and efficiency to the process. Furthermore, the study revealed other useful technologies such as artificial intelligence, machine learning, robotics and blockchain.
Conclusion: Utilising IoT and cloud computing in public procurement and SCM is best option for the South African government. They do not only bring efficiency to the process but also improve the advancement of preferential procurement and improve green economy initiatives.
Contribution: This study contributed to the body of knowledge on the usage of technology in public procurement and to the sustainable development goals of reducing inequality and climate action.
Keywords: Internet of Things; cloud computing; procurement; public sector; supply chain management; sustainability; efficiency.
Introduction
Background
Uniform standards and centralisation by the buying institutions are the primary trends in public procurement that have emerged in recent years (Mircea, Stoika & Ghilic-Micu 2022:63355). According to Akaba et al. (2020:3), public procurement is a principal purpose of government actions that catalyse economic development and advancement, if the actions are performed efficiently and transparently. National Treasury (NT) highlighted that public procurement depends upon the fundamental principles of behaviour, which, if one of them is broken, collapses the whole procurement and supply chain management (SCM) system (NT 2015). These are ‘value for money, open and effective competition, ethics and fair dealing, accountability and reporting, and equity’ (NT 2010). On the other hand, there is a development in global technology that is seeing significant growth, with Industry 4.0 serving as a means to facilitate this progress (Javaid et al. 2022:203). Industry 4.0 is commonly depicted as a revolutionary force that aims to bring about significant transformations in both societal and economic realms (Thani 2020:82). Moreover, Bhagwan and Evans (2022:3) argue that the implementation of Industry 4.0 in South Africa presents the potential for enhancing production and distribution processes, while at the same time facilitating the attainment of the United Nations Sustainable Development Goals (SDGs).
According to Thani (2020:82), Industry 4.0 can potentially address South Africa’s service delivery challenge and concurrently enhance its global competitiveness and significance. The feasibility of this proposition arises from the fact that Industry 4.0 is distinguished by a novel array of technologies that can integrate the realms of the physical, digital and biological (Ng et al. 2022:4). Accordingly, in the context of public procurement in South Africa particularly, Industry 4.0 can be seen as having the potential to enhance efficiency, transparency and effectiveness. These are the core attributes emphasised by Section 217 of the constitution of the Republic of South Africa (RSA) as well as Section 38 of the Public Finance Management Act (PFMA) of 1999. In agreement with, Koh, Orzes and Jia (2019:9), Industry 4.0 needs a paradigm shift in how production and manufacturing are performed and ultimately how the distribution of products is conducted across the supply chains. Thus, it will drive significant structural theoretical evolution and revolution for operations and SCM. As stated by Mabinane and Edoun (2022:1391), governments across the world are subjected to digital disruptions from technologies that have obliged them to review their processes in an attempt to remain relevant and responsive to the challenges. Notwithstanding, various reforms carried out to date on public procurement in South Africa and the application of SCM as a strategic policy tool are not yet realised. The system of South African public procurement continues to face various setbacks and has been greatly critiqued (Fourie & Malan 2020:1). In South Africa, the challenges that face public procurement in this era include a lack of accountability and non-compliance to legislation (Maramura & Ruwanika 2023:6). In addition, Zindi and Sibanda (2022:2) confirm that biased procurement process, poor record handling in supply chains and insufficient contract administration are equally contributing factors to public procurement inefficiencies. All these setbacks owing to poor planning in the procurement process are defeating the intention of the NT to strengthen the principles of procurement and SCM. Theoretically and practically, the use of cloud computing has not been thoroughly explored as a topic within public procurement and SCM (Ageron, Bentahar & Gunasekaran 2020:133).
The major setback in the procurement and SCM in South Africa is the result of the legacy system, which has made a conducive environment for interference and caused delays in service delivery. Moreover, Sibanda, Zindi and Maramura (2020:3) conclude that the exacerbated problems in SCM and procurement are because of the failure to develop an effective monitoring system for reporting and accountability. To counter these issues, Mafungwa and Ngcobo (2019:12) suggest that the automation of the procurement procedures is imminent, where budgets need to be correlated to the demand and procurement planning, while scrutinising changing markets in real time. Accordingly, this study aimed to investigate how Industry 4.0 technology can be used to sustain procurement and SCM in the South African public sector. Moreover, the study sought to explore the usage of Internet of Things (IoT) and cloud computing in terms of process efficiency improvement in procurement and supply chain operations.
While with Industry 4.0 comes many technologies that have the potential to disrupt operations on all ends, this study focuses on the IoT and cloud computing and the potential benefits they bring to procurement operations in the South African public sector. The study sought to investigate how these two technologies can bring sustainability to procurement and supply chain operations in the South African government. The utilisation of a dynamic procurement system is imperative in facilitating the advancements in public procurement. In addition to this prevailing primary trend, there is a growing emphasis on the concept of sustainability in the context of public procurement, as well as heightened attention towards the utilisation of emerging technologies to modernise public procurement This study submits that sustainability in public procurement will have to address two concerns, strengthening the pillars of SCM in the procurement process and improving efficiency in the procurement and supply chain processes.
Literature review
Principles of supply chain management and public procurement in South Africa
Recently, the effective use of public funds for procurement reasons has increasingly been conceived to be a pedal for progressing the efficiency and effectiveness of public spending. According to Fourie and Malan (2020:1), public procurement plays a significant part in the economy and government spending and can be regarded as a critical indicator of the effectiveness of the administration, because it is a central aspect of public service delivery. Supply chain management has also emerged as a contributing factor towards the improvement of performance in the country’s economy and has been used by South African government as a vehicle for service delivery (Mhelembe & Mafini 2019:1). Correspondingly, Sibanda et al. (2020:2) concede that South African government uses supply chain to obtain goods, services and works from private service providers to fulfil its mandate to the public. Therefore, Mojaki and Chukwuere (2021:14) emphasised the need to continually search for techniques to improve the performance of supply chains and procurement systems by the South African government.
In accordance with Molepo and Jahed (2022:235), to effectively operationalise digital supply chains and procurement as a tool, the system is required to be aligned to the principles of ‘value for money, open and effective competition, accountability and reporting, ethics and fair dealings, and equity’. Public procurement in South Africa is a vital tool that must ensure high-quality service delivery to the citizens (Maepa, Mpwanya & Phume 2023:2). According to Mathiba (2020:649), ‘value for money’ entails the definite prevention of spending financial resources on goods or services of inferior quality. This means that the government must have a system that will ensure cost-effectiveness during the execution of the procurement process. The concept of ‘open and effective competition’ refers to a clear and competitive procedure throughout the procurement process (Fourie & Malan 2020). Molepo and Jahed (2022:235) explain it as a transparent and competitive procurement process.
As claimed by Mathiba (2020:649), the concept of ‘Accountability and reporting’ constitutes a fundamental pillar of every public procurement system. Therefore, without transparent and accountable systems facilitating engagement between governments and citizens in a reciprocally responsive way, the immense resources directed through public procurement systems run the threat of increased corruption and misappropriation of funds. The principle of ‘Ethics and fair dealings’ addresses the distribution of information to all the potential service providers in a non-discriminatory manner and subsequently the evaluation of their proposals without prejudice (Mpehle & Mudogwa 2020:2). Furthermore, Molepo and Jahed (2022:235) argue that this principle compels practitioners to act ethically in executing procurement activities. Lastly, Mpehle and Mudogwa (2020:2) argue that the principle of ‘equity’ is aimed at implementing support measures to accelerate the growth of designated groups that were historically excluded. This is the affirmative action that ensures the advancement of small-, medium- and micro- enterprises (SMMEs) by the government (Mathiba 2020:649). Towards achieving the objective of this study, the following sections examine the features of IoT and cloud computing to curb the challenges identified in the introduction earlier. According to Allioui and Mourdi (2023:1), IoT proved to be a dynamic tool for improving efficiency in SCM operations and procurement systems, whereas cloud computing-based applications and devices compel users to be more efficient in their activities (Amron et al. 2019:1).
Integration of cloud computing and Internet of Things in supply chain management and procurement
Digital transformation has significantly impacted all angles of life, most importantly the economic sphere (Yaqub & Alsabban 2023:1). Thus, the explosive evolution of technology and its integration into business processes has become relevant. In SCM, cloud computing has emerged as a concept of the paradigm shift that has offered businesses opportunities such as scale, flexibility and agility to improve their processes. In agreement with Yang, Kim and Yim (2019:1), a fusion of technological uprisings has necessitated a change in the systems and has created new markets and demands on economic platforms. Accordingly, governments’ support has become significant in business areas in these emerging technologies. Notwithstanding the importance of other technologies, this study highlighted in the introduction that it has focused on IoT and cloud computing’s characteristics towards the improvement of public sector procurement and supply chains in South Africa. Cloud computing is the transmission of digital resources such as storage, databases and servers, across virtual platforms (Yenugula, Sahoo & Goswami 2023:194). On the other hand, IoT is the interaction between humans and machines (Mostafa, Hamdy & Alawady 2019:2).
According to Lampropoulos, Siakas and Anastasiadis (2019:4), IoT is a fast-growing innovative technology that has various functions and applications that are useful for everyday life in supply chain and procurement operations, whereas cloud computing offers a competitive advantage in SCM operations (Yenugula et al. 2023:194). The key function of IoT is connecting people and objects to achieve a common purpose (Seyedghorban & Samson 2019:8). Moreover, Allioui and Mourdi (2023:6) posit that this interconnectivity allows seamless integration of key characteristics that drive physical systems towards a more connected intelligent world. Admittedly, Gothwal et al. (2023:69) theorise that IoT brings intelligence to the systems by using modern essential technologies to improve process efficiency. The literature provides additional applications of IoT in the SCM. In accordance with Ageron et al. (2020:135), another capability of IoT, which is critical for supply chain operations, is the capability to ensure the sustainability of the procurement system, which is brought by accurate data exchange among supply chain partners. Baghel, Dwivedi and Singh (2023:74) stress that IoT-based systems improve efficiency and accuracy in the system and are capable of detecting fraudulent activities. This assertion holds relevance for procurement within the South African public sector, as it aligns with the provisions outlined in Section 217 of the Constitution of the RSA Act 108 of 1996, the Public Finance Management Act (PFMA) 1 of 1999, the Preferential Procurement Policy Framework Act (PPPFA) 5 of 2000, and the procurement guidelines stipulated by the NT. The NT (2017) articulates that there must be proper planning in procurement and SCM in line with the necessities identified in the institution’s strategic plan. Equally, the North-West Provincial Government (NWPG) (2019) highlights that a procurement plan should be developed out of the strategic plan’s input and the various frameworks that give effect to the department’s service delivery mandate. The research conducted by Moodley (2019:6) substantiated that IoT devices can gather, retain and send data to cloud-based storage systems. Furthermore, Kumar, Tiwari and Zymbler (2019:1) suggest that IoT can be used in preparation work when planning in businesses because it gives assurance and improves interoperability. Along with cloud computing, it has demonstrated its effectiveness in various domains, including database administration, and demand forecasting and planning, IoT will improve procurement systems and assist users in planning properly (Aydin 2021:3).
In terms of South African public procurement, optimisation of supply chains and improving the procurement process goes beyond mere planning. In line with the South African legislative framework that governs SCM and procurement, the government wants as many sellers as possible to engage in the bidding process, to ensure the principle of equity as highlighted earlier (NT 2010). To that effect, Koskin and Van Nguyen (2021) highlight that cloud computing offers a multitude of advantages to consumers based on the specific services and models they choose to use. Consequently, this will also equate to a multitude of service providers that offer those options to the market, which is the government-buying entities.
Applying the concept of IoT and cloud computing in SCM and procurement, South African public sector can bring many benefits that can improve efficiency through the entire value chain. For example, the key feature of IoT, which is often referred to as a cyber-physical system (CPS), when integrated with cloud computing becomes self-regulating (Mostafa et al. 2019:1). This means that data can move through digital platforms eliminating the need for physical contact, which mostly is subjected to human error and inefficiency in the process. According to Maepa et al. (2023:1), a high level of human contact in procurement leads to inefficiency in the process and often paves the way for corruption. Thus, Al-Doori (2019:245) argues that digital data exchange allows stakeholders in the supply chain to work on the same data at a particular time and with limited resources. Furthermore, this allows them to perform all activities in the procurement process without error (Al-Doori 2019:245). According to Akaba et al. (2020:4), to overcome the challenges in procurement, an innovative method for tracing all aspects of government procurement for trust, transparency and efficient use is necessary. Therefore, IoT and cloud computing with their characteristics are anticipated to bring efficiency to public procurement. Furthermore, the integration of IoT and cloud computing in procurement is anticipated to yield enhanced efficiency in terms of prompt planning, implementation, and contract monitoring and reporting with procurement and supply chains. As claimed by Molepo and Jahed (2022:233), the transformation brought by digital platforms can improve transparency in the procurement, process, enhance data management, and reduce costs related to procurement.
Adopting technology in the processes is not without flaws. Irsheid et al. (2022:205) argue that cloud storage, which has become popular as an efficient alternative in Industry 4.0, has increased risks and threats to SCM and procurement operations. Certainly, Mohlameane and Ruxwana (2020:1) concede that while cloud computing provides essential benefits for individuals and organisations, it still casts doubt on its adoption because of security and reliability issues. Also, Mathebula (2021:18202) highlighted several cases of security issues in government with institutions such as the City of Johannesburg, the Companies and Intellectual Property Commission (CIPC), and various government departments experiencing security breaches in their systems in recent months. However, Thani (2020:82) attributes the security breach in the systems to infrastructure challenges and technology-based skills. This means that issues related to security can be reduced to individual organisations to strengthen their systems. For instance, organisations need to be extremely agile and have a high level of risk mitigation capabilities and structural flexibility to counter these challenges (Ben-Daya, Hassini & Bahroun 2019:4719). Similarly, Ageron et al. (2020:134) emphasise that when technologies transform, there is a need for industries to adapt to competencies such as data security on the cloud platforms employing IoT devices. Therefore, it can be argued that harnessing IoT and cloud computing functions in SCM and procurement operations must be performed holistically with data security considerations as well.
Research methods and design
An exploratory research approach was followed for this study. This approach is valuable in asking questions to determine what is happening and gain perceptions about a topic of interest (Saunders, Lewis & Thornhill 2019). Kivunja and Kuyini (2017) found that the ways to conduct exploratory research include a search of the literature, interviewing experts on the subject and conducting in-depth individual interviews. The exploratory nature was chosen because it is flexible and adaptable to change. Therefore, this allows a researcher to change direction when new data and insights occur (Saunders et al. 2019). The study population was drawn from managers in the procurement space in the public sector in South Africa. A purposive sampling was applied as the selection technique for data collection. Furthermore, purposive sampling was selected under their capacity to provide richly textured information, relevant to the phenomenon under investigation (Saunders et al. 2018). Data collection was performed through interviews. It has proven to be difficult to predetermine the sample size in a qualitative study. Therefore, interviews were conducted until the data were saturated at seven participants, which according to the researchers was a reasonable number to address the study objectives.
Data collection
The data collection entails one-on-one interviews with the seven participants. As indicated under Section ‘Research methods and design’, the study population comprised of procurement managers from various departments at provincial and national spheres of government. The participants included one from the Department of Public Enterprises, one from the North-West Department of Community Safety, two from the Government Pension Administration Agency, two from the South African Forestry Company, and one from Western Cape’s Department of Environmental Affairs and Development Planning.
Data preparation
The interviews conducted were audio-recorded with Google Meet and transcribed using Microsoft 365. Preparing data involved assigning pseudonyms to the seven participants to conceal their identity. Participants were named Participant A, Participant D, Participant S1, Participant S2, Participant P, Participant M and Participant L. The following step was to read the interview transcripts for understanding and accuracy. Where the transcription was not clear, the researcher revisited the audio to the exact time stamp to get accurate insight. This exercise was followed to ensure confirmability of the findings in which the interpretations are grounded in the data. After checking documents for accuracy, they were loaded as a new project on ATLAS.ti 24. Appendix 1 presents a summary of interview transcripts from seven participants. The interview transcripts of this summary were loaded on the ATLAS.ti 24. This step was necessary for the researcher to be able to identify suitable information that is relevant to the research objectives (Byrne 2022:1398).
Data coding
The data coding in this research involved reading through the dataset loaded on the software and coding sentences and some combinations of words. Therefore, during this process, the researchers assigned ideas to text from participants to provide meaningful insights. Thus, where participants implied the same thing, the same code was used. The coded segments were done through ATLAS.ti 24 and later grouped to identify relationships. The grouping of codes is discussed in Section ‘Code grouping and refinement of code groups’. According to Kiger and Varpio (2020:5), this is an analytic step in the process that helps the researcher shape data at a specific level. In this step, the researchers noticed probable data items of importance and other primary intentions (Byrne 2022:1399).
Code grouping and refinement of code groups
This step was performed by grouping codes to form categories. Code grouping involves reading all the codes on the software and deciding which codes to combine. This grouping was informed by the sustainability of public procurement and SCM through Industry 4.0 technologies. Furthermore, the code grouping involved considering the implementation of Industry 4.0 technologies to improve process efficiency in public procurement. Also, this step encompassed scrutinising the coded and collated data extracts to identify probable themes of broader importance. According to Kiger and Varpio (2020:6), themes are constructed by the researcher by analysing, combining, comparing and even graphically mapping how codes relate to one another. As highlighted, the construction of categories from the code groups was created to pave the way to identify themes.
Creating networks
This stage was approached following two levels of analysis. Firstly, the researcher interrogated coded data placed within each code group to ensure proper fit. At this point, data extracts were sorted and code groups combined to better reflect and capture coded data. This exercise involved adding, combining, dividing or even discarding some information to draw meaning out of the coded networks. Secondly, the research used the set of networks to determine if they fit meaningfully within the dataset. On this level, the researchers created themes from network groups. Thirdly thematic maps are presented under the ‘Discussion of the findings’ section.
Ethical considerations
Ethical clearance to conduct this study was obtained from the North-West University Economic and Management Sciences Research Ethics Committee (Reference no.: NWU-00656/24/A4).
Discussion of the findings
The findings in the following sections are structured according to the interview guide interrogation. The research findings are discussed in line with the objective of the study.
Sustainable public procurement through Internet of Things and cloud computing
The first objective of the study was to link the IoT and cloud computing with sustainable public sector procurement and supply chains in South Africa. The research was guided by the following questions to achieve this objective: (1) Based on your understanding of IoT and Cloud computing what change do you think they can bring to public procurement? (2) How will implementing IoT and cloud computing enhance government initiatives on preferential procurement?
Procurement revolution through technology
The results of the study reveal that the capabilities offered by IoT and cloud computing can bring a positive change to public procurement. Participant A highlighted that features such as real-time data analysis will enhance accuracy in information sharing across the entire value chain. In addition, Participant D, Participant L, Participant S1, Participant S2 and Participant M agree with the importance of information sharing to ensure transparency in the process. Participant D further emphasised the need for transparency, seamless collaboration, continuity and repeatability in the process. The insight shared by Participant L highlighted that these technologies can also bring accountability and traceability in the process because digital record keeping will ensure that there is an audit trail and an error-free SCM system. Furthermore, Participant S1 highlighted that there will also be stability, as the manual processes have proved to be unreliable when it comes to this process Figure 1 shows the impact of IoT and cloud computing on public procurement.
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FIGURE 1: Impact of Internet of Things and cloud computing on public procurement. |
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Preferential procurement enhancement
The data collected through interviews revealed that the participants have conflicting perceptions of the advancement of preferential procurement initiatives by technology. For example, Participant A, Participant L, Participant P and Participant S1 believe that IoT and cloud computing can advance targeted groups in terms of preferential procurement. Participant D believes that these technologies can assist this initiative to a certain extent because the majority of the targeted groups are not digitally ready, as most of the contribution stakeholders are rural communities. Participant M believes that the implementation of IoT and cloud computing on public procurement will not have any bearing as the institutions will still have to determine their specific goal targets. Figure 2 shows the graphical presentation of the enhancement of preferential procurement through IoT and cloud computing.
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FIGURE 2: Enhancement of preferential procurement through Internet of Things and cloud computing. |
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According to the participants, there are four major outcomes that IoT and cloud computing can provide towards this enhancement. These include the reduction of barriers to entry for SMMEs and the improvement of inclusivity. These outcomes blend with the two pillars of procurement, namely ‘open and effective competition’ and ‘equity’. Furthermore, the participants revealed IoT and cloud computing play a significant role in addressing the disadvantages of the past, which were directed at certain groups. Participant L notes that harnessing the capabilities of IoT and cloud computing will eliminate the practices that tend to advance only the enterprises that are well off but they will also include groups that historically were excluded. Finally, the participants reveal that these technologies provide supplier segmentation. This means that these technologies will separate emerging firms from well-established ones when there is a need to advance them. This will be ideal for competing for bids that are not specialised in nature.
Process efficiency through Industry 4.0 technologies
The second objective of the study was to investigate how Industry 4.0 technologies can improve process efficiency in public sector procurement and supply chains in South Africa (Figure 3). The research was guided by the following questions to achieve this objective. The research asked the following questions to the participants: (1) Should process automation in public procurement be considered by the SA government and if yes, why? (2) Are there any emerging trends or technologies that the SA public sector can adopt to improve its processes?
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FIGURE 3: Process efficiency through automation. |
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Process automation in South African public procurement
All participants believe that the government should consider process automation in public procurement. This is because of the number of benefits that can result from this exercise. According to Participant A, automation will improve compliance and effective procurement. Furthermore, it will increase cost efficiency and transparency and reduce biases in the process. In agreement, Participant L, Participant M, Participant S1 and Participant S2 share the same sentiments. In addition, Participant P highlights that accountability, which is one of the crucial components of public procurement, will be improved. On the other hand, while Participant D agrees with all the sentiments shared by others, she further reveals that process automation will reach as far as green economy initiatives. Thus, automation will contribute positively to SDGs.
Emerging trends on utilisation of technology to improve the processes
Figure 4 shows emerging technologies that can be used to improve process efficiency in public procurement. Participant P highlighted that there is a positive implementation of technology in South Korea where all systems in the process are connected to achieve a common purpose in public procurement and this resulted in a drastic reduction in corruption. Furthermore, Participant P reveals that machine learning and robotics can be exploited to run the process to the betterment of public procurement in South Africa. These technologies can assist with the analysis of expenditures, demand forecasting and designing smart contracts. Correspondingly, Participant A supports that blockchain technology is an advanced database mechanism that can improve transparency with business networks that public procurement shares, while machine learning can improve strategic sourcing. In conclusion, Participant D highlights that artificial intelligence (AI) can read correct information and write memorandums. Therefore, this technology will enhance accuracy in the process and improve turnaround time and the time taken to draft reports can be utilised for other activities.
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FIGURE 4: Emerging technologies to be considered for public procurement efficiency. |
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Challenges of automation in public procurement
The participants highlighted the positive impact that IoT and cloud computing can bring to public procurement and the entire SCM (Figure 5). However, the implementation of these technologies is not without challenges. One of the biggest challenges that was highlighted by Participant D and Participant L is the continued digital divide between the urban and rural communities. In contention, Participant P argues that in this digital age, almost every household has a smartphone and that is the starting point of digital inclusivity. However, that being the case there is still a concern as not everyone has access to data. Thus, Participant S1 suggests investment in network infrastructure by the government to cater equitably for all citizens. Moreover, Participant D highlights that the other hurdle of process automation is the data security concerns.
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FIGURE 5: Challenges to technology adoption in public procurement. |
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Recommendations
This study recommends the adoption of technologies in South African procurement processes and SCM operations. This is based on the benefits that they bring as highlighted in the findings of the study. Also, the government should consider investing in network infrastructure to reach the communities that do not have access to the Internet. This will ensure that the digital divide is bridged and every citizen shares equal access to information regarding government procurement. Furthermore, the government should invest in data security to eliminate all challenges that are associated with the implementation of digital procurement processes. As suggested by Participant S2, the State Information Technology Agency (SITA) must be empowered to deal with cyberattacks.
Contribution
This study contributed to the body of knowledge in the existing literature on public procurement by presenting theoretical insight into the usage of IoT and cloud computing to improve processes. The insights shared can be used by scholars in their research and also by policymakers to improve their processes. Practically, the study provides valuable insights into how IoT and cloud computing can be utilised to improve public procurement and SCM. Furthermore, the study shared insight into how initiatives of preferential procurement can be addressed. In conclusion, the study has contributed towards the realisation of SDGs 10 (reduce inequality) and SDG 13 (climate action). These are 2 of the 17 goals agreed upon by world leaders as a shared blueprint for peace, and prosperity of the people, and the planet, now and into the future.
Conclusion
The purpose of this study was to link IoT and cloud computing with sustainable public procurement. In addition, the study sought to investigate how process efficiency can be improved using these technologies. The research embarked on an empirical investigation to address these objectives. Therefore, seven interviews were conducted on procurement management in the public sector. The research gathered insights and compiled a research report that aimed to address the objective of the study. The research began with providing background to the topic under investigation, reviewing the literature, conducting interviews and producing a final research report. This final report is produced from the analysis of data collected and analysed through ATLAS.ti 24.0 software.
Acknowledgements
The first author, Lawrence M. Mojaki, would like to thank Dr Tuyikeze and Dr Ndlovu for their mentorship, supervision, support and guidance in writing this article. This article is partially based on the author’s thesis entitled ‘Developing a digital procurement framework based on Industry 4.0 technologies for the public sector in South Africa’ towards the degree of Doctor of Philosophy in Economic and Management Sciences and Business Administration in the Department of Economic and Management Sciences, North West University Business School, South Africa on 19 December 2024, with supervisors Dr Nkanyiso K. Ndlovu and Dr Tite Tuyikeze. The authors would like to acknowledge the first article published under the above-mentioned thesis by Mojaki, Tuyikeze and Ndlovu 2024.
Competing interests
The authors declare that they have no financial or personal relationships that may have inappropriately influenced them in writing this article.
Authors’ contributions
L.M.M., under the guidance of North-West University supervisors, conceptualised and conducted the study towards his PhD research. The author was involved in writing of the article and handling all comments from the reviewers and the editorial board. T.T. and N.K.N. provided guidance and supervision to L.M.M. and reviewed and recommended improvement where necessary. Also, T.T. and N.K.N. were responsible for editing the final manuscript submitted to the journal.
Funding information
This research received no specific grant from any funding agency in the public, commercial or not-for-profit sectors.
Data availability
The data that support the findings of this study are available from the corresponding author L.M.M. upon reasonable request.
Disclaimer
The views and opinions expressed in this article are those of the authors and are the product of professional research. It does not necessarily reflect the official policy or position of any affiliated institution, funder, agency or that of the publisher. The authors are responsible for this article’s results, findings and content.
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Appendix 1
Summary of interview responses from participants
1. Objective 1: Link the Internet of Things (IoT) and cloud computing with sustainable public sector procurement and supply chains in South Africa.
- 1.1. What change can IoT and Cloud computing bring to public procurement?
- Participant A: ‘… will improve on real-time data collection by ensuring that we reach our stakeholders … also receive accurate information. Also, they will address the delays … and avoid things such as divisions … Able to reach a higher targeted number in real time we can get the response in time.’
- Participant D: ‘… record-keeping … seamless collaboration because other people will be able to work on data… eliminate again the human factor where some keep documents. So when you have the information other people can access it. … availability of information to everyone ensures transparency. Which in the case of South Africa will be good for public servants as one of the procurement pillars. Then, besides the transparency stuff, like I said, for continuity and repeatability.’
- Participant L: ‘They can bring a lot to public procurement like efficiency and elimination of corruption. So it will enhance accountability … it will enhance the cost, the traceability or the audit trail in terms of the events of things… So it will enhance accountability as well as reporting.’
- Participant M: ‘It is important for decision decision-making in the supply chain space … Ensuring that we move towards saving all of our documents on a cloud in some way will ensure that access to information is easily achieved … mistakes that have happened in the past are not repeated … will ensure that an error-free type of supply chain system.’
- Participant P: ‘It is going to increase transparency in the processes … So as a result, transparency by itself reduces corruption… and also the public oversight.’
- Participant S1: ‘… that can be able then to bring some kind of stability moving forward … People in terms of giving people equal opportunity.’
- Participant S2: ‘… it will help for the public procurement to be effective in terms of speed because right now our processes are too long even if it is a small thing it will take like take the whole month with the process.’
- 1.2. How will implementing IoT and cloud computing enhance government initiatives on preferential procurement?
- Participant A: ‘I think because this system can be able to help us to do possible research on supplies information, therefore we can use it to target specific groups. For example, we will be able to advance categories of targeted groups if we can filter the system according to our preferences. For example, aligning our online procurement capabilities to a preferential procurement policy.’
- Participant D: ‘To a certain extent the majority of the country and the inhabitants of the country are not necessarily IT-ready. The majority of the rural communities do not have access to the Internet and they are the people who contribute largely to preferential procurement targets. So, these technologies can address the preferential procurement initiatives provided the government bridges the digital divide that is prevalent in the country.’
- Participant L: ‘They will enhance if the government can do their role in terms of rolling out technological capabilities in the rural areas. When we look at the people that are left behind, when it comes to preferential procurement, it is people with disabilities, black youth, black women, and people in rural areas. Those are the people that are affected in terms of preferential procurement … the spend towards them is still low when you look and most of them are not privy to how public procurement things work.’
- Participant M: ‘I think for me the initiatives around IoT or cloud computing does not have any implication on preferential procurement … insuring that the whole procurement system is digitalized can never have a negative impact on preferential procurement … in the same cloud there will be the service providers designated according to the demographic.’
- Participant P: ‘We are required to publish names within a prescribed period, though it is not a strategic activity it is a compliance issue which often causes problems. But imagine if the system just immediately after you close the publication is done online. The calculation of scores is done is automated, so you know even just a reduction in errors.’
- Participant S1: ‘I think it has an impact in terms of the information which is kept if you look at the recent regulations Preferential Procurement Regulations 2022 in terms of confirmation of demographics as a requirement. Some of these things cannot be confirmed, but if the information can be utilized, I believe that this technology can be able to track these things and being able to confirm whether whatever it is being claimed, indeed is. It is because a lot of information will be in the cloud.’
2. Objective 2: Investigate how Industry 4.0 technologies can increase process efficiency in the SCM of the South African public sector.
- 2.1. Should process automation in public procurement be considered by the SA government and if yes, why?
- Participant A: ‘They should consider it a more compliant and effective procurement. It will also increase transparency in procurement costs and reduce things such as kickbacks. Then all service providers will be able to take part in the procurement process.’
- Participant D: ‘The impact on the environment, I think that is the aspect that also we need to focus on or what will be beneficial for us to move to more electronic and cloud-based practices. Also, the reduction of too much human involvement in the process which is prone to committing mistakes. There’s always a risk because garbage in, garbage out, you know, so it can be beneficial. However, I think the implementation must be right by training the practitioners to implement it.’
- Participant L: ‘Yes, because it will enhance transparency in the sense that the can be an automated list of service providers who submitted bids at the time of bid closing. So, the will not be any chance of bidders entering the process through the back door.’
- Participant M: ‘Oh yes, process automation completely, that should be the government strategy… as having technology ensures that there is less interference and there is less errors on the system. … it will be an error-free process and it will be a process … did not have any influence, any manual influence, as a result, it works better even for auditing purposes.’
- Participant P: ‘If the government is interested… this will be in terms of five pillars of procurement be a big achievement achieved… which is, among other things, is accountability and reporting.’
- Participant S1: ‘I believe that things need to be automated and to eliminate longer processes in concluding a transaction in the procurement process … to conclude a transaction is lengthy and this delays service delivery.’
- Participant S2: ‘Yes, it is a very good idea, for effectiveness and also to avoid fraud and corruption.’
- 2.2. Are there any other trends and emerging technologies in digital procurement that the SA government should consider adopting?
- Participant A: ‘The blockchain is an advanced database mechanism that allows transparent information sharing within business networks … There is machine learning as well to enhance strategic sourcing.’
- Participant D: ‘You know, I think technology such as artificial intelligence (AI) can read correct information and write up memorandums for us. Therefore can help our adjudication committee with automated recommendations. In terms of our internal processes, I think AI will help to speedily conclude procurement processes.’
- Participant P: ‘… what caught my attention is about South Korea where they have an online tracking system… among other benefits that the nations, is that it reduced opportunities for corruption in Korea online.’
- Participant P: ‘So, technologies such as robotics will ensure that procurement intentions are easily realised … AI and machine learning will assist with spend analysis, predictive analytics, and demand forecasting. Also, these technologies will assist in drafting smart contracts.’
- Participant S2: ‘There are other ERP systems used by private companies like systems applications and products (SAP) software, though they have their challenges they still offer more benefits than in the public sector in that most functions are integrated.’
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