UK Innovation Plan – Public Procurement Culture Change Needed

The UK’s Department for Business, Innovation and Skills (BIS) has launched a “National Innovation Plan: Call for Ideas”.  This is an appeal to the public for bright ideas that can help the UK become more innovative, address societal and economic challenges and drive UK jobs, exports and economic performance ultimately. Here is how the initiative is introduced.

“The UK has a long and strong history in science and innovation, and a world-leading reputation, being ranked second in the Global Innovation Index in 2015. But there can be no complacency about the global challenges we face and the increasing levels of competition. At the same time, the nature of innovation is changing towards greater use of digitally connected technologies and data. This is changing how goods and services are produced and delivered, and transforming established markets.  This survey seeks views on how the UK should further develop its innovation framework and system.  This will help us to develop a National Innovation Plan”.

The survey on the government website here asks for input to an innovation framework that:

  • builds and supports an open business environment that encourages innovation
  • promotes collaboration and the sharing of ideas to drive innovation opportunities
  • provides businesses with the confidence to invest in R&D and supports them to diffuse and scale the best ideas
  • uses the power of procurement and customer demand to stimulate the development of innovative products

One of the questions in the survey is all about public procurement. It says this;

How can we deliver real culture change within public procurement?

The public sector is one of the main customers in the UK economy spending around £240 billion per year: equivalent to around 14% of GDP. This demand also has the potential to drive up innovation and productivity in suppliers, many of whom are SMEs. Government can act as a "first customer", embedding a challenge based approach to procurement and substantially increasing the amount of government spending that results in innovative products, services and processes for citizens and tax payers.

Issues to consider - What can government do differently? What works well?  What challenges do businesses face when government is their customer?  How can we work with innovative businesses to ensure innovation flourishes?  How can we work together to be more innovative in our procurement approaches to achieve maximum value”?

The first point we might raise is whether we really need a “culture change” in public procurement, and if so, a change to what? We suspect what is meant is a change to a more risk-taking, innovation-focused approach to spending money. But is that really appropriate? There are risks there, both to value for money and in terms of the potential for fraud and corruption.

But we wouldn’t want to be too negative. Of course procurement should be open to innovative ideas and proposals that result in “innovative products, services and processes for citizens and tax payers”.  There are huge issues here though, ranging from skills, to regulations, to attitudes and, yes, culture.

And as we have said before, many of the wider aims of public procurement cut across the fundamental strategy that has been adopted in the UK public sector in recent years – to aggregate, centralise and standardise.  It’s worth noting that this is a BIS initiative; are Cabinet Office and Crown Commercial Service engaged, we wonder? Because if we really want to drive innovation, some of those fundamental approaches will need to be reviewed and adapted.

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First Voice

  1. Sam Unkim:

    Psst.. wanna buy a pretty pretty bridge, I give you very good price, you buy today only Yes ?

    Being open to ideas from potential or incumbent suppliers is one thing. Being a passive lap-dog for some customer (with no commercial nous) hell bent on squandering millions, is entirely another

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