Supply Chain Management (SCM) - Gauteng Provincial Treasury - Management Assignment Help

Assignment Task:

Introduction

According to Bartlett and Dibben Innovation in the public sector has become an important focus for governments around the world over the last decade. The pressure on governments to do more with less, in response to shrinking budgets and expanding community expectations and obligations, has led to a much greater focus on how the public sector manages change and innovate.

Gauteng Provincial Treasury is a provincial department in the Gauteng Province, a overarching role is to ensure that all provincial financial resources are managed effectively, in a manner that promotes the delivery of services to the public. 

As the custodian of the financial resources for the province, GPT supports all 14 national outcomes and is responsible for resourcing the Provincial Programme of action aimed at Transformation, Modernization and Revitalization of the Province.  The Gauteng Provincial Treasury has 5 programmes which support the oversight role: Provincial Supply Chain;

Financial Governance; Sustainable Financial Resource Management; Auditing Services, Provincial Forensic Services. The challenge identified is in the Provincial Supply Chain Unit.

The Supply Chain Management (SCM)  and Financial Governance unit has a mandate to ensure that procurement is in compliance with regulations and  expenditure does not exceed budget allocation from the 14 provincial departments. The challenge with the  COVID 19 pandemic is the increase of expenditure for PPE expenditure which was not there before and non-compliance when the suppliers are contracted, Secondly we do not have an end-end view of the overall expenditure from procurement planning to paying and a monitoring tool of the compliance of the service providers for the commitments in terms of their supplies. This end to end view will help in ensuring that the monitoring is effective and we do not overcommit or buy products at inflated prices.

Amongst other challenges are procurement administration process which are manual and done outside the system, which is not integrated and is hindering progress toward exploiting opportunities made available by automated Procurement systems. Whilst the province processes all the financial transactions in the financial systems, there is no price marketing tool to find out the commodity prices charged by different companies when we buy goods and services from them, and such the department finds it difficult to track suppliers spend at a unit price level for different or  for the same product by other organization. In addition what is difficult is when the suppliers split the purchase orders and not using the approved threshold of procurement.

The maverick buying from the different suppliers result in challenges of paying too much for the same product, whilst if there was visibility the department could negotiate prices and convert the purchases to contractual obligations. Lastly monitoring the performance of suppliers in terms of delivery can also be monitored and avoiding  buying of suppliers that could not deliver when they have received the order. The monitoring of purchase orders daily can also assist on what is bought when and the consumption of the goods and services.The data that will be used for the prediction is historic data from the financial system of commitment and invoice information data which is recorded on SAP Financial System this include prices paid to suppliers by the state on contract or data based on procure to pay data. A data dump for  a specific period can be requested from the source owner for  supplier information which host the supplier personal information for example address information of suppliers, size of company, when was the company registered and tax compliance information of the supplier. 

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