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Procurement process gets no respect

by Michael Asner

Over the last few months, I've given my workshop, "Bullet-Proofing Your RFPs," several times. The government buyers attending were mostly from smaller agencies, municipalities, cities and counties - not from major players such as the federal or provincial governments.

At these sessions, I was once again reminded of the complex, and at times frustrating, world of public purchasing. Our discussions focussed on a variety of issues, most of them related to managing the Request for Proposal (RFP) process, such as making the process more effective or managing vendors. Some of the "hot topics" of interest to buyers these days include:

  • How to handle debriefings - how much information should be released;
  • How to deal with the contract process and negotiations with vendors;
  • How to avoid negotiation gridlock;
  • The importance of past performance in judging suppliers and the questions to ask;
  • How to use information obtained from references - what if you actually rely on it;
  • What to do with unsolicited proposals - can you use the ideas and not the proposal;
  • How to structure Best and Final Offers;
  • How to establish effective evaluation processes; and
  • How to structure RFPs for professional services when everyone is qualified.

These issues are important, and elicited strong and sometimes opposing views from different participants. But by far the most frustrating topic, producing the most emotional responses, was working with internal information technology staff.

Several participants took great pains to describe their reality: the chronic tug-of-war between purchasing and information technology (IT). These buyers truly believe that IT staff see little value in the role of purchasing; they see purchasing only as an obstacle keeping them from doing their very important work. Purchasing, in turn, sees IT as the favoured, indulged child of management that bypasses proper process and does not understand public policy issues.

The role of IT is clear: to provide computer-related infrastructure to deliver programs. Purchasing's role is just as important. The trouble is that it is often unstated. Purchasers are the custodians of public policy related to procurement. They must ensure that vendors can compete fairly for the agency's business. They must ensure that the law is followed. Furthermore, as experts in the RFP process, negotiations and contracts, they must ensure that the agency gets value for the money spent. To purchasers, IT staff often proceed with haste. They are often quick to throw out the safeguards mandated by well-established business and purchasing practices for the sake of expediency. Purchasers remember what IT forgets: a decades-old legacy of failed IT systems and major projects delivered late and over budget.

The IT version of this reality is different. IT staff are always under pressure to deliver more and deliver it sooner. They often perceive purchasing as "holding up my project" and are impatient about waiting, wanting to "start now - why do we have to have the contract signed?"

In some of these agencies it is clear that IT staff have little time for, and perhaps little awareness of, the public policy issues. To make the situation worse, they may be unaware of the public scrutiny that procurement undergoes and of recent successful legal actions brought by suppliers against public bodies for failure to provide fair and open competition.

Many of these public buyers also recognized that purchasing's role as owners of the process and guardians of public policy in the procurement process is not considered important in their organization. One participant explained that both purchasing and IT reported to the same executive and that there was an ongoing conflict between the departments brought on by the lack of a clear definition of the role of each group.

While the problem is serious, the solution is not difficult. The role of procurement in the organization - its responsibilities related to law, public policy, value for money spent - should be described in detail. And this mandate should be broadcast throughout the organization, from the most senior politicians to the heads of each department and to every employee. Staff should be told about recent court cases related to "fair and open competition," informed about the duties and obligations that the courts have imposed on the buying organization, and the risks they face by ignoring their procurement staff. They should be aware of all the value-added services that buyers introduce into complex purchases.

In my opinion, public agencies need ensure that the critical role of purchasing is valuable part of it their culture, not an impediment. Not doing so wastes resources and undermines the agency's effectiveness.

Michael Asner (asner@compuserve.com), based in Vancouver, is internationally recognized as a procurement expert. He authors The RFP Report, published in Canada and the US; he contributes a regular column in Reseller magazine, a Sacramento-based publication; and he has authored several books on procurement, including The Request for Proposal Handbook and Selling To Government. He recently launched www.proposalsthatwin.com and www.proposalworks.com.



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