Cathay Pacific (CX) is an international airline based in Hong Kong. CX offers scheduled passenger and cargo services worldwide. In addition, CX’s business also includes investments in catering and ground-handling companies. Business Environments that CX Faces
The macro-economy and price of jet fuel are two most challenging factors significantly affecting CX’s operating results: * Macro-economy: the load factor was adversely affected by macro-economy because people travel less in weak economies. * Price of jet fuel: Persistently-increasing trend. Fuel price accounted for 41.6% of CX’s total operating costs in 2012.
Facing such two challenges, what CX can do is to take measures to mitigate the negative effects. One of the counter-measures that CX takes is to adopt a new procurement system which substantially reduces its procurement costs. Drivers of the System
It is for to build the most efficient purchasing process and capability in the industry. Internet based tools provide better spend and supplier information and access to new suppliers through e-market places. Firms would better manage and control their expenditure and reduce cost of purchasing and of goods purchased. Firms leverage their corporate buying power and suppliers benefit from a more efficient and integrated requisition to payment process. It provides better information for corporate decision making. Intended System Users
Public sector organizations use e-procurement for contracts to achieve benefits such as increased efficiency and cost savings (faster and cheaper) and improved transparency in procurement service. Besides, some other large enterprises e.g. Cathay Pacific also needs the system to manage and control their procurement process in an effective and efficient way. Benefits from the System
* Reduced procurement administration cost
* Improved information intelligence for...