Procurement case studies – good news from the UK public sector frontline?

I had a day off from Spend  Matters duties this week and with my consultancy / training & development hat on, spent the day with an English local authority - well away from the London area. I don't usually write about my consulting work here, for obvious reasons, and I'll keep this anonymous, but there were some thoughts I really wanted to share.

For a start, it is refreshing to see public procurement from somewhere other than London and Whitehall, and it was also very good to hear some of the success stories from that authority. They face challenges, like pretty much every part of the public sector in the UK and probably elsewhere. Not enough money to do everything they would like to do; taxpayers who expect better services at lower costs; an ageing community needing more care and attention.

But their response to this seemed to me intelligent and there were some examples of creative and appropriate procurement related projects. I use the word 'appropriate' having recently emphasised in another article the need for every organisation to ensure that  its own procurement strategies (and indeed business strategies) meet its own specific needs. So in this case, the success stories include a major capital investment project that the authority chose to fund itself, rather than using PFI (as some in central government were suggesting). Borrowing costs are very low at the moment, so this move alone saved tens of millions. That case also included some impressive stakeholder management and communication work and a very effective construction procurement.

Another recent example featured what appears to be a very appropriate use of the Competitive Dialogue procedure, much disliked by Francis Maude and Cabinet Office but effective in some cases without a doubt. And the third case study has won awards already as an innovative approach in a major spend category,  developing good supplier relationships but aligned with strong cost management (open book provisions, target pricing, gain -share contracts, etc).

I'd also wondered whether I might find a somewhat parochial approach to the 'buy local' issue, which is understandably high on the agenda for elected representatives at local level, just as national politicians get excited about the national 'buy British' issue. But the evidence was of a pretty considered approach to this too - trying hard to do the right thing for their locality, and to meet the politician's goals, but being aware of both potential legal constraints and the fundamental need to obtain best value for money. Sometimes difficult goals to reconcile - but awareness of the nuances and issues is a good start.

It wasn't all high-fives and pats on the back. I was interested to hear that that contract management is an issue, given how much I've written about that recently and over the years. Some in the organisation (not in the group I was with of course) still apparently don't get the importance of that topic. We went through the whole 'good procurement + bad contract management = bad results' argument, which I seem to be using a lot these days.

So a couple of generalisations. Thinking hard about what works for your organisation, and not being afraid to challenge Whitehall or indeed other conventional wisdom, seems to be admirable when considering complex commissioning and procurement issues. Stakeholder engagement is always important in any procurement exercise of any complexity. And whilst there are no easy solutions to difficult issues (like the potential dichotomy between local supply and value), really understanding and thinking about the issues in the round gives you some chance of achieving a successful balance and outcome.

 

First Voice

  1. Trevor Black:

    It’s regrettable that many local authorities are delivering excellent projects which are saving the tax payer millions but don’t get any publicity. They have excellent and committed procurement professionals who do not get the recognition they deserve. Central government could learn a lot from them. I don’t really care what Francis Maude thinks about Competitive Dialogue, if it is the ideal solution then use it. The last place to look for strategic procurement advice is Whitehall where despite all the disasters are just playing at it!

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