Are Frameworks Doing Their Job? (Part 2)

In the second of two posts addressing what Jon Milton, director of temporary labour supply specialist Comensura, thinks the future holds for public sector frameworks, he now considers how framework providers could work more effectively with suppliers.

In part one I considered how frameworks should change in the future to become more practical  for the public sector. Key to the success of a framework is the suppliers that are selected to go on it. But what’s in it for them?

  1. Are frameworks worth the effort for suppliers?

Just as frameworks are proving to be a complex landscape for users, getting on to a framework as a supplier isn’t without its complications either. Frameworks provide suppliers with a tried -and-tested route to an existing customer base and let’s face it, without suppliers there would be no frameworks. So why make it more challenging and difficult than it really needs to be for suppliers to get on frameworks in the first place?

The challenge for most suppliers, especially SMEs, is the time and effort it takes to go through the tender process to get on the framework. Many find the process unnecessarily complicated and steeped in red tape with no guarantee of work at the other end of it – and that’s even if they successfully make it onto the framework.

There are many things a framework could do better for suppliers:

  • Provide guidance on potential return based on market opportunity, the level of interested buyers and their intentions.
  • Place a significant weighting on technical capability, and test that technical capability in the tender. This will help to award suppliers based on best fit, rather than purely price, as can be the case.
  • Provide a forum for chosen suppliers to network with customers.
  • Listen to, rather than ignore suppliers as they are a vital source of market knowledge and can shape a framework to make it more market relevant.

What frameworks shouldn’t do for suppliers:

  • Promise the world and deliver nothing – over time this will mean the supplier pool will diminish as a ‘lack of opportunity’ realism sets in.
  • Impose onerous, and sometimes completely inappropriate terms, and then expect the supplier to accept the terms or risk being excluded.
  • Encourage low price or poor fit tendering.

The time has come for a root and branch review of tendering processes and communication standards that really help suppliers to understand what a framework can do for them. This leads me on to my next question.

  1. Is the selection criteria for getting on to a framework in the interests of the public sector and the economy?

The selection criteria for getting onto a framework can be wide ranging and, for most tender processes, price will be the overriding factor. Price is of course critical but should not be at the cost of all other factors.

As a managed service provider of temporary staff, we have seen tender processes that have been completely based on price. How can this be right for such a complex category if capability and capacity to deliver services aren’t taken into consideration?

Frameworks are without doubt an essential part of the public sector’s procurement toolkit but they need to evolve to become more versatile and fit-for-purpose. My view is that it is the responsibility of the buying organisations to do a lot more to establish frameworks that are fit-for-purpose and meet market needs and work with their suppliers to achieve this.

 

Voices (5)

  1. Final Furlong:

    Very few frameworks add ‘value’. Many pubic purchasers adopt the use of them because they’re less risky and convenient. The vast majority of the decision-making then rests with those who call-off. They often impede innovation (unless any refresh is frequent). Most buyers who support frameworks do so because, at some stage in their public sector career, they needed something quickly and a framework helped them achieve it. The Digital Marketplace has some way to go, but it does, in a number of ways, align to a private sector model, especially in running a sprint bidding process. The CCS frameworks are littered with text book examples of how the helpless deliver something hopeless to the hapless.

  2. Nick @ Market Dojo:

    The framework is just the start and creates no value. The value comes from the call-off, i.e. when a transaction occurs. However, some frameworks are very poor value. As a supplier, what scenario is going to encourage you to give a better deal:

    A) Someone approaches you saying, “I want to buy £500k of your goods/services, what’s your best price?”

    B) Someone approaches you saying, “Get set up on this framework and we might buy some stuff from you, what’s your best price?”.

    Even for scenario B there’s still potential for creating value by running mini-competitions via eAuction for the call off. A council recently ran one on our software, costing them £500, and saved over £300k compared to their sealed bid process! However it still seems that very few organisations follow this approach and simply call-off at the stated prices, costing tax-payers literally millions.

    1. Dan:

      The value of mini-competitions depends on the framework – if the ‘value’ to be delivered by the framework depends on aggregation of demand then there’s little point in running more mini-competitions as you are effectively aggregating then disaggregating the demand.

      Framework agreements are both contracts and procurement tools. Sometimes they work well. Sometimes the contract is botched. Sometimes the contract is fine, but it is misused as a tool. At the end of the day, it boils down to the acumen of the procurer*

      *sometimes its wilfully misused for political reasons driven from above the procurer e.g. “we really want to use this particular supplier and it just so happens that they’re on a framework….”

      1. Nick @ Market Dojo:

        Hi Dan,

        Great reply and scarily accurate! I would say that there is no aggregation of demand at the point of devising a framework, in that no one has committed anything. The demand comes at the point of call-off, and so is naturally dis-aggregated, unless organisations club together for the call-off.

        For example we’re on G-Cloud, (perhaps) one of the larger frameworks in the UK intended to aggregate demand across the entire public sector for SaaS products. However when a demand does come it’s ad hoc. Our pricing on G-Cloud is actually higher than if the organisation had come to us directly, though that mainly relates to the fees that G-Cloud charge suppliers on call-off. That’s actually a separate bug-bear of mine in that there are a number of ‘procurement’ companies that set up frameworks then charge commission for anyone using the framework, further obfuscating the value for money.

  3. alun@marketdojo:

    Having been part of several frameworks we couldn’t agree more. The inconsistency in the selection criteria and how charges are past on vary considerably.

    Many frameworks are set up to make it easier for procurement departments to buy from them although it makes it more complicated for the suppliers, and most likely more costly for the buyer in the long run.

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