Public sector procurement needs a serious rethink
Shaun Gomm of Sigma would like to see SMEs involved at every stage of the process
It’s pretty easy to argue that the current public-sector procurement model is broken. Despite many civil servants boasting that our national model is the envy of the world, much could be done to improve the process and its outcomes.
Considering that approximately a third of government money is spent on contracted goods and services, the fact that we’re currently not doing everything possible to optimise and improve this process is deeply frustrating for all involved.
This is particularly true in light of the much-publicised recent failures of major suppliers, such as Carillion, it has never been more critical for the public-sector procurement model to be reconsidered, to better fit the current business and economic landscape.
There are certainly smart, progressively-thinking people in Government who are trying to instigate the shift towards flexible, fit-for-purpose procurement processes. However, they’re fighting an uphill battle against a tide of institutionalised poor practice and opacity.
The current culture is somewhat counter-productive, essentially removing the ability for individuals to apply any common sense and, unfortunately, also allowing the ‘old boys’ network of huge outsourcing companies to dominate the market, to the detriment of smaller suppliers.
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Sadly, this doesn’t look like it’s set to change anytime soon. As it stands, only 21% of civil servants believe that there is inclination within their department or organisation to increase involvement of SMEs in the tech procurement supply chain, according to figures from techUK.
Considering this, the Government’s target to spend a third of its procurement budget with SMEs by 2022 is looking ambitious at best.
This is why we need to break up the monopolies created by these huge systems integrators and services firms, in order to create a more level playing field in which SME suppliers – which can offer greater flexibility, innovative approaches, and in some cases better value for money than the more established players – can thrive.
In order to bring about long-lasting, meaningful change we must begin treating procurement professionals as empowered individuals who are capable of exercising some judgment, rather than just rigidly following a set of archaic rules that don’t reflect modern digital thinking and practice.
Whilst it is inadvisable to throw out the rulebook entirely, it could be treated as a framework for good practice, with helpful checks and balances, rather than a binding set of regulations.
If procurement teams are not allowed to exercise any discretion in procurement processes – subject to those checks and balances – they may be unable to explore important issues and considerations on an ad hoc, bid-by-bid basis. This, in turn, undermines their own decision-making capability and could potentially lead to the wrong supplier being picked at the end of the tender process.
Communication is key
A great way to foster trust and create closer relationships between both sides is to communicate, early, openly, and often. Suppliers should be invited to offer their feedback more regularly – ideally at each stage of the process – to pinpoint any issues, share success stories, and improve the process as a whole.
The procurement process needs a serious rethink, and this process needs to start now.
In light of the recent failures involving the larger outsourcing firms, increased scrutiny is likely to be on major suppliers and projects. This in turn will hopefully create opportunities for smaller suppliers to shape the market, and give it a much-needed shake-up.
A major step towards fixing the procurement process, particularly in the digital industries, is to seek more input from SMEs and providers, taking full advantage of the wealth of knowledge held by our thriving tech sector.
While I’ve outlined some ways in which we can go about fixing this, the solutions are long term, and will take time to effectively implement.
I believe that there’s certainly a desire within government to make this better, but this motivation must be matched with action if we are to see the meaningful, long-term change we severely need.
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