P-card utilization in municipal government: advantages and concerns
| DOI | https://doi.org/10.1108/JOPP-03-01-2003-B004 |
| Date | 01 March 2017 |
| Published date | 01 March 2017 |
| Pages | 75-94 |
| Author | John L. Daly,Michael A. Buehner |
| Subject Matter | Public policy & environmental management,Politics,Public adminstration & management,Government,Economics,Public Finance/economics,Texation/public revenue |
JOURNAL OF PUBLIC PROCUREMENT, VOLUME 3, ISSUE 1, 75-94 2003
P-CARD UTILIZATION IN MUNICIPAL GOVERNMENT:
ADVANTAGES AND CONCERNS
John L. Daly and Michael A. Buehner*
ABSTRACT. P-card (i.e., procurement card) programs have been praised as
innovative means for procurement systems to save fiscal resources for municipal
government while granting greater purchasing discretion for departmental end-
users. Using Hillsborough County (Tampa), Florida as a case study, the authors
identify four critical factors that influence the successful implementation of
municipal P-card systems. In the final analysis, the authors suggest that the
distinction between organizational success and failure for these programs is
likely to be a factor of organizational commitment more than technical capacity.
INTRODUCTION
Effectively managed municipal governments today are increasingly
utilizing advanced technologies to improve services and preserve limited
fiscal resources. Elected officials, appointed administrators, and
taxpaying citizens expect an organization to integrate technology more
effectively for improved administrative decision-making and operational
practices. This movement toward more fiscally lean and resourceful
public organizations is not a revolutionary concept. Clearly, the tax
revolts of the late 70s and 80s, along with more recent “reinventing” and
“reengineering” movements in the 90s, have accelerated this standard.
Given these environmental “pushes,” it was only a matter of time when
emerging technologies would influence public sector purchasing
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* John L. Daly, Ph.D., is Associate Professor, Department of Government &
International Affairs at the University of South Florida, in Tampa, Florida. His
primary research interests include human resource management, strategic
management, organizational change, and public policy in Southern Africa.
Michael A. Buehner, MPA, is a consultant with Tribridge, Inc. in Tampa,
Florida. His areas of specialty include process improvement, performance
measurement and organizational change.
Copyright © 2003 by PrAcademics Press
76 DALY & BUEHNER
practices. Fortunately, many innovative municipal procurement systems
are meeting this challenge and adapting their processes. One
“technology” helping to create considerable savings, while improving
end-user acquisition of needed goods and services, is the introduction of
purchasing cards (also known as P-cards).
This research presents information about the recent implementation
of P-card technology in Hillsborough County (Tampa), Florida’s 4th
largest county government (Bureau of Economic and Business Research,
2000). As will be evident from this work, changing the way an
organization does its purchasing can be demanding, even when the
initiative leads to beneficial outcomes.
THE HISTORY OF P-CARDS
Purchasing card procurement is a relatively new phenomenon. P-
cards are credit cards issued to corporate or government users so they can
transact small-value purchases – usually under $ 1000 – for their
organizations (Gillett, 1997). They were introduced first to American
corporate markets in 1991 and have witnessed rapid growth since
(Milligan, 2001). Some of the early implementers of P-card systems
include: Temple University [1991], PepsiCo [1994] (Garrison, 1997),
ITT Automotive [1993] (Palmer, 1996), Westinghouse Savannah River
Company [1994] (Anonymous, 1998), and Merck & Company [1994]
(Murphy, 1998). The use of credit cards in lieu of traditional purchase
order transactions offers many advantages as well as a few drawbacks.
The benefits of P-cards are discussed below with implementation
challenges and system drawbacks addressed later in this article.
Purchasing card system growth across corporate America has been
substantial over the past decade. Its proliferation is the result of
organizations seeking increased process efficiencies that P-card
implementation affords. For example, it reflects their desire to reduce
delays due to burdensome paper processing, higher labor costs associated
with traditional purchasing practices, and product delivery delays due to
purchase order acquisition. The goal often is to increase purchasing
agility through new and leaner purchasing processes.
Generally, municipal applications of P-card systems have lagged
behind private sector practices. Factors influencing these delays in local
government include: 1) the procurement offices’ desire to maintain
control and accountability over purchasing practices, 2) fears that
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