Many organisations have a slow down through festive seasons as many people head off on holidays and the volume of work often slows. So if you're lucky enough to be working during a quite time, what procurement tasks can you do to take advantage of the extra flexibility and set yourself up for when the pace picks up again?
Last year I noted two significant cases, amongst many others, of poor procurement practices resulting court cases and the payment of damages. Envoy Relocation Services successfully sued the Canadian Government for unfair treatment during successive procurement processes. The court awarded Envoy $30 million in lost profits and also directed the Government to pay Envoys $10 million legal costs; in another case, a major retailer sued a Central NSW coast council in Australia over a faulty process, resulting in damages of around $2 million being awarded to the retailer. The council later appealed and won, but the court, delays and internal staff costs must have been significant. While these commercial horror stories will capture the headlines and provide great examples for frightening clients during probity briefings, are the fines the only damage suffered by organisations through poor procurement practices resulting in low integrity procurement.
Competitive dialogue is an approach to market that is somewhat akin to parallel negotiation, but instead of hashing out the finer points of the final contract, the aim is to have the market refine the specification before it is published to invite final offers. It utilises the additional parameters of shared intellectual property and a collaborative process in a controlled environment that retains competitive tension through to the signing of the final contract. First written into European procurement regulations in 2006, the methodology has become a preferred method of market engagement for complex projects in the UK and it is now written into the procurement policies in New Zealand, but it is largely unheard of in Australia. The process is designed for the strictly regulated public sector procurement environment of Europe, but is there something to be learned for other environments?
The whole concept of a contract is to provide certainty of the agreement between two or more parties, but what do you do if that certainty does not exist and you need to provide a level of certainty in the relationship?
A few years ago I was told by a middle manager to stop referring to the policy "...as the policy is not always right". More recently I was in a procurement reform workshop and the statement was made that we should "...stop focusing on compliance and instead focus on outcome". Back a few years I was chatting to a bio chemist who was traveling the world reviewing quality systems, he said "Australia has some of the best quality systems I've seen anywhere in the world...none of them work, but on paper they look great". These are all symptoms of the same issue and often "reducing compliance" is seen as the answer, but what is really going on?
I have found that generally ten concurrent procurement projects of varying complexity per practitioner is about the upper limit of being able to ensure enough focus is placed on each job. Right now though, with the combination of team members being on leave and the new year projects kicking off, I find myself with closer to 30 concurrent jobs. As I was attempting to review a complex plan, I could see the Outlook popups fading in and out in an almost constant stream. I likened it to sitting in a boat under a waterfall trying to bail it out with a thimble. So what tactics can we use to manage these periods of intense overload?
Spreadsheets are a powerful and commonly used tool in procurement. Whether used to track what contracts we have, calculate cost, score evaluations or tracking projects. However, few Excel workbooks in procurement really leverage the full power and possibilities of Excel. With just a basic knowledge of the Visual Basic for Applications (VBA) language, you can turn your Excel workbook, into an Excel Application with functionality you never considered possible in a spreadsheet. This is the first in a series of blogs covering the development and use of an Excel Application to build a Advanced Excel Contracts Manager for managing Contract Lifecycle Management (CLM).
A critical component in building a powerful contract life cycle management application in Excel is to determine what data you want to capture and then taking steps to ensure data quality is maintained. It is always a balance between usability and the need to build meaningful reporting. While using a standard format spreadsheet quickly becomes arduous when there are more than 15 fields of data, the Advanced XL Contract Manager provides functionality that makes capturing a hundred fields efficient and easy. There are the obvious fields such as the contract number, title, description, start and expiry dates. But there are a few fields you may not have thought of. In this blog, we'll start with defining the Contract fields and validation methods to make sure our data stays clean.
Establishing a detailed and concise set of response criteria not only facilitates the extraction of key information in vendors responses, helping to align their solution with the actual requirements, it also allows easier evaluation and scoring of those responses, but not all criteria has equal importance. This is where applying a method of weighting the criteria provides the ability to define which criterion will have the greatest benefit to delivering the requirement and is therefore more important. But the question is, should the weighting be published as part of the invitation for offer, or should it be for internal information only?
Let me state emphatically off the bat that this "Procurement Made Easy for You" website is not targeted at shortcuts or workarounds, few things will kill process efficiency and effectiveness quicker than taking the easy way out. There is nothing clever or admirable in delivering an outcome by skipping over all the foundations, keystones and frameworks that ensure the outcome is built to last.