Leveraging Technology in Public Procurement (Post 1)
This is the 1st post in a series of posts that looks at the relationship between public procurement processes and technology enablers.
Public procurement functions have often been perceived as laggards when it comes to technology adoption. This is sometimes a very good example of the old chicken and egg adage – the processes act as roadblocks in the acquisition of a modern best of breed application solution. However, given the complexities of the public procurement processes and the stringent focus on adherence to rules, adoption of a procurement application in a public sector organization is, simply put, like a marriage made in heaven.
To delve deeper into this, let us look, at a high level, the key requirements of a public procurement process (not in a prioritized order) –
1.Transparency: With all the current focus on misappropriation of funds and / or proper utilization of funds, it becomes imperative that there is complete transparency in the procurement processes
2.Reporting: There should be provision to quickly generate reports containing all the relevant information
3.Auditability: The procurement process should be completely auditable and every transaction or action should be traceable
4.Fairness: The system should be fair to all participants
5.Special Provisions: The system should be able to easily account for any kind of special provisions like allocation of a certain percentage to SMEs
6.Accessibility: The process should be easily accessible to all eligible vendors. There should not be any barriers to participating in procurement or tendering processes
7.Sharing and Access Control: There is a need to provide access to different procurement documents and events to different people with varying levels of access
Achieving all of this through a manual process is quite cumbersome and time consuming. However, most of the leading procurement solutions that are available in the market today, provide all of these to a very large extent. Obviously there may exist the need to customize or configure the applications to exactly meet the unique process requirements of each specific organization.
However, once the organization is successfully over the speed bumps of implementation and training of the teams on the application, it more or less a very smooth journey ahead.
While jotting down all the use cases and examples of process where the application can really add value vis-à-vis a manual process is not something we can cover in the context of this blog, let us just jot down a few examples here. The key is to ponder on how much time and effort it may take to accomplish them via a manual process, considering that most of these can be achieved through very minimal effort using a procurement application –
1. We need to post the information of a tender / RFP on the public organization’s official website (under the recent tenders section)
2. We need to able to evaluate the technical section and the commercial section separately across the sections for all the suppliers to decide on the winning bid(s)
3. We need to provide justification on the winning bid of a tender / RFP
4. We need to support the process for disputes to be raised by a losing vendor
5. We want to conduct a reverse auction to identify the best bids and bidders
6. We want to present a report to our senior management on all the purchase orders issued in the last 18 months over a certain monetary value and for some purchasing category
If you enjoyed this, stay tuned as I’ll be soon coming out with my next blog in the series of posts that looks at the relationship between public procurement processes and technology enablers.