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The 2010 local government procurement landscape; a view
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The public procurement landscape in 2010: a view
Dr Gordon Murray26 March 2010
A view• Commissioning/procurement/purchasing• Co-production• Recession response• Innovation & innovative procurement• Procurement as a shared services• Category management• Strategic eProcurement • Personalisation • Sustainable procurement
The commissioning cycle
Strategic needs assessment
Decide priorities and outcomes
Plan and design services
Optional appraisal
Sourcing
Delivery
Monitor and review
The commissioning
cycle
Strategic needs assessment
Decide priorities and outcomes
Plan and design services
Optional appraisal
Sourcing
Delivery
Monitor and review
Determine the need
Supplier selection
Contracting
Ordering
Expediting
Follow-up/evaluation
The commissioning
cycle
The purchasing
cycle
procurement
Implications for procurement professionals• New roles• Commissioners will have demands for support &
advice• Funding strategy• Understanding co-production• Honouring the commitments of the Compact &
Concordat• Removing the barriers• Engagement with the market• Interpreting the legislation• …
The recession
• Probably the worst recession in >100 years• Four times larger in terms of GDP than
‘Great Depression’• Longest decline in manufacturing output
since ONS records began in 1955• More recessions in last 35 years than the
previous 350 years• 5% of council ‘strategic/critical suppliers
‘at risk’
Critique of current strategy
• Public procurement strategy has changed little to reflect the current recession and may actually be dysfunctional What’s this tell us about ‘strategic procurement’?
• Need to rethink approach to ‘environmental scanning’
• Need to review procurement strategy Short v long term Cost reduction v achieving community benefits Risk profile of suppliers
10 short-term steps to accelerate viable economic recovery
1. Democratic leadership and ownership2. Link with economic development strategy3. Proactively open opportunities, incl. new suppliers4. Short-term contracts5. Multi sourcing making use of ‘lots’6. Encourage innovation7. Make use of social clauses8. Pay within 4 days using p-cards or 9. Pay on delivery10. Provide security of business through forward
standing orders
Innovation & innovative procurement• Strategic objective• Focus on outcomes• Cross-functional teams• Strategic linkage
Cost reduction Sustainable procurement Economic development
• Recognise the market as an asset• Performance manage• Read ‘Innovation Nation’
Procurement as a shared service
• Shared services procurement needs to be included within consideration of structural models
• What about shared services across public sector bodies?• How robust is the options appraisal process?• Do operational shared services procurement lead to
strategic procurement shared services? • To what extent does political procurement curtail
decisions?• To what extent do shared services constrain political
procurement?• Shared Procurement Strategy?• Shared eProcurement strategy?• …
Category management
• Professionalism v protectionism• National/Regional/Local• Have the answers which members
are being encouraged to ask through ‘IDeA Member guides’
• eProcurement is part of the solution
Strategic eProcurement
• The business case• The eProcurement strategy• P2P seamless transaction cost
reduction• Ownership and roll-out across
categories• Strategic information management• Category management
Sustainable Procurement• Member & Chief Officer commitment• Relationship with Sustainable Community Plan and
‘Procuring the Future’• Linkage with
• Strategic procurement management • Cost reduction strategy • Local economic development strategy • Climate change strategy • Category management strategy
• Clear message to be communicated to the market and staff• Commitment to act throughout the procurement cycle• Commitment to on-going improvement• Plans for reviewing effectiveness
Efficiency Exchange
Imagine a tool for …• collaborative knowledge sharing
what works and doesn’t work, but will in certain circumstances
• collaborative problem solving helping find the one person who’s thinking about the same
challenge or has a suggestion which could help or enabling suggestions which could help someone else
• drawing on local government expertise in Drafting a policy, specification, contract ...
• mass on-line conferences, debates and ability to question experts
• Comparative benchmarking on efficiency• …
You follow the link to: http://
www.communities.idea.gov.uk/comm/land ng-home.do?id=436525
And register, it takes five minutes!
What to do if you want to join?
The public procurement landscape in 2010: a view
We lead in exciting times
[email protected]/DrGordonMurray
