What Are We Looking Forward to in the 2016 Procurement World? (Part 2)

Today, we're continuing our look ahead to some of the highlights and areas we will be reporting on though 2016.

Procurement Value and Alignment

Pretty much everyone in the procurement world will agree that we have to focus principally on value, not cost reduction, and that the way to do this is to be aligned with the business and key business stakeholders. So let’s hope that CPOs and other leaders reflect and promote that.

What does that mean in practice and what do we hope to see in 2016? One of the prime indicators of a real change would be many more procurement people and functions being measured on a sensible range of performance indicators, not merely "savings". And actually, more intelligence around measuring savings (when they are an appropriate measure) would not go amiss either. Procurement leaders can do their bit too - for a start, don't take a job if all the employer wants is cost reduction. (OK, we will exempt a very few firms / industries from that rule!) Make sure people who work for you aren’t measured principally on “savings”. Report on a range of KPIs and success measures. And let’s all try and promote outside our industry to increase public, media and business understanding of what procurement is all about - and that it isn't just about "doing deals" and "cutting costs".

Public Sector Procurement and Leadership

An era ended in 2015 in the UK public sector with Bill Crothers and Francis Maude leaving their roles. We suspect whatever leadership emerges in the centre (Cabinet Office) it will be less dominant than the Maude / Crothers axis; so there is an opportunity for others to step up and show their leadership credentials. We feel we are beginning to see that in the Health sector, less so up to now in local or central government, although we know there are excellent procurement people there as well. Let’s see more success stories, more collaboration (from the bottom up, not imposed), and better use of technology for a start.

We will also see how the still relatively new EU and national procurement regulations bed down and become part and parcel of daily activity. There has not been much evidence yet of contracting authorities making use of "innovation partnerships" for instance. Less positively, will we see more and more demands for procurement to take into account all sorts of social factors when making procurement decisions? The Scottish guidance on assessing whether bidders are "good employers" was an indicator of just how ridiculous this can get. But as austerity bites, we need creative and innovative suppliers to the public sector, who offer new ways of doing things in many areas, from social care to military equipment. So we also need procurement processes that can help to find such suppliers and contract with them in a manner which supports the right delivery and performance.

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Of course, there are many other areas we could mention. The outlook for the global economy, let alone the political situation around the world, will of course have a huge impact on our jobs in 2016. As well as our somewhat more parochial interests, we'll try and keep abreast of those issues too insofar as they impact on the exciting world of procurement!

 

Voices (3)

  1. Sam Unkim:

    Re: stepping up and show their leadership credentials.

    “We feel we are beginning to see that in the Health sector.”

    2015 was a disaster & 2016 is not looking any better, or are you expecting John Warrington, to pull a “Rocky” and come off the ropes in the 12th round ?

    1. Peter Smith:

      I think some of the developments at Trust level are what encourage me – we’ve featured some good stories here, with innovative use of technology often at the heart of it. I’ll give Pat Mills a bit more time before making a judgement, but really I’m expecting more from the best Trusts and their CPOs than from the centre.

      1. LM:

        Well said Peter. There are a number of quite capable CPOs in trusts. But Sam’s point is also well made. The final Carter report is expected to be published this month and we should use its content to judge the overall progress made in healthcare…and by the DoH.

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