NEPO – Successful Regional Procurement Collaboration Comes Of Age (Part 2)

We touched on the NEPO Business Club in part 1 yesterday and the collaborative buying organisation’s work with the local North-east business community. In terms of that supply-side work, when we recently met Steven Sinclair and Nicola Shelley of NEPO, they were rightly and clearly proud of the Club, which is part-funded by rebate income from sales to Associate Members.

“We provide support to local firms, such as training in how to bid for public sector contracts. We’re getting emerging evidence that firms who have undertaken this training are doing better and succeeding in winning work. The aim is that should be not just contracts in the North-east but more widely”.

Coming back to the core NEPO procurement operations, there are now 21 people working in the organisation and about 70 contracts in place, across categories including social care, fleet, IT, construction, food and professional services. Around 50 of those are delivered centrally and 20 are shared, so set up locally by the different authorities on a hub and spoke model, but let and managed using the NEPO standard tools, templates and contracts.

“That is important so suppliers still see these contracts as part of the overall NEPO approach and family”, says Shelley. There is a “gateway” approach to the operational work, with due diligence carried out to check on progress at key stages for both centrally let and local work.

The NEPO Portal e-tendering system is powered by Due North software, that firm now being part of Proactis, and spend analytics software comes from Atamis. But while contract opportunities are advertised formally on the portal, Sinclair stresses the importance of early market engagement, “which is embedded in our process”.

“We start thinking about a requirement 18 months ahead and we use the NEPO Business Club to help us shape our procurement and contracts. We use engagement approaches for different categories - it might be a large supplier open day or one-to-one discussions, but getting this right is key to meeting user needs”.

The team are also very aware of the focus on social value and “next level social value” is a high priority initiative. “We want to get the balance right here – gaining benefits without it getting too onerous for suppliers”, Sinclair explains. He acknowledges that “we have perhaps allowed too many different approaches to social value in our contracts. It has been very bespoke and inconsistent at times, and sometimes it has been hard to ensure delivery of what suppliers have promised. But we have had some successes and some creativity too – like sausage-making competitions in schools, run by our meat supplier!”

But NEPO is now working with the national social value initiative and the social value portal, piloting an approach using that to define outcomes and measures more clearly.  This forms a key part of NEPO’s strategic objectives, Shelley explains, “It is imperative we secure the maximum value from every pound that we spend to benefit the communities and local business that we serve. Embedding social value across our organisations and becoming part of how we do business is an essential part of how we can maximise the value.”

The team also has an appetite to work on the national stage where appropriate, collaborating with the LGA and the university sector for instance, and with over 300 Associate Members largely outside the region now using their contracts. But they are keen not to be seen as just a framework factory, and look to use diverse contractual models, as evidenced in their flexible approach to supplier rebates we mentioned yesterday. Their framework for Specialist Professional Services (known as NEPRO) is a good example of this innovative approach – and we will have more on that in the third and final part of our series tomorrow.

The proof of the pudding is in the results of course, and NEPO is seeing steady growth in spend from both core and Associate Members, as well as more rebate income and greater engagement with the local supply base – all encouraging metrics, and signs of an organisation that you get the sense is very clear on its purpose, strategy and operational model.

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