Raj Sharma, on Public Spend: ‘The government market is one of the most closed in the world’
A sense of frustration — and optimism — comes through when Raj Sharma speaks about the state of public procurement, or government contracting.
“Government markets are supposed to be open — the fact is, the government market is one of the most closed in the world, with significant barriers to entry,” says Sharma, co-founder of Public Spend Forum, a sister site of Spend Matters. “Many suppliers find it too difficult to penetrate, and end up walking away from the complexity, costliness and unyielding regulations.”
In an interview with Nancy Clinton of Spend Matters UK/Europe, Sharma details how he has dedicated much of his professional life to finding ways to improve government contracting and ways people can better interact with government.
In addition to public spend being difficult for suppliers, those on the inside have it tough too, he says.
“Government buyers and government contracting professionals have neither the time nor the resources for sufficient market research,” Sharma says. “Add to that an environment where avoiding failure at any cost is better than smart risk-taking, and we are stuck in a cycle of suboptimal outcomes.”
In 15 years of tackling public sector issues, Sharma has learned a lot and has developed some tools and ideas about how to improve interactions and results in public spend.
One of those tools is GovShop, a way for people to get free market research and supplier information.
In the interview, he also said his months of meetings and talking with buyers in government about their challenges has lead him to believe there’s a universal set of issues related to government market research. His list has three challenges:
- Lack of time — government market research, and the funding required to train to do it well, is not treated as a critical aspect of public procurement. Complying with rules and “paper pushing” takes precedence over spending time on more high-value tasks, like searching for and engaging with suppliers. Time is one key issue and people don’t have enough of it.
- Fast-changing markets — by nature this applies to both the public and private sectors. From what he’s seen, government doesn’t have a defined role for market research. Where people might have a responsibility to build contracts, work with customers and manage supplier relationships, they aren’t necessarily monitoring the market at all times. The market is moving, and as suppliers enter and leave it, it’s impossible for someone to keep track of it all.
- Data fragmentation — even if they had the time to do the market research and keep an eye on market movements, the fact is, data around suppliers, in terms of who is out there, what they do, their experience and real credentials, including certifications for the critical regulations governments may have, is patchy. While some open data sources exist, many are incomplete, often with surface-level information that is not useful towards qualifying and selecting suppliers.
Sharma believes there’s power in having government work well for the people it’s meant to serve.
Governments around the world are the custodians of $10 trillion that are not being spent efficiently, and public procurement has the power to broadly influence change, he says.
“Even if we could improve the effectiveness of a small proportion of that spend,” Sharma says, “it could do a lot of good to a lot of people, and I believe create a better world for everyone.”
Read the full interview here: Working Toward a More Open and Accessible Public Sector Marketplace — for Suppliers and Buyers