It’s no secret that the very technologies transforming how we live and work often elude the practices of government. Nowhere is this more evident than in the way government buys things.
The 89,000 agencies making up our local, state and federal government collectively spend trillions of dollars each year on goods and services to support our communities. But look under the hood of government purchasing, and you’ll see a labyrinth of burdensome policies resulting (more often than not) in inefficiency and overspending.
These policies have been created in an attempt to foster fairness, promote transparency, and prevent corruption. But over time, regulation upon regulation has replaced the fear of corrosive practice with widespread inefficiency.
Through the hard work of clear thinking public servants, new approaches are beginning to emerge. But this is happening slowly because the roots of this inefficiency lie in policy, process and regulation. And we know how slowly the wheels of policy change turn.
This should concern each of us – not simply because this violates our 21st century sensibilities. But because it hampers government’s ability to do the very work our tax dollars fund: providing beds for the homeless, food for the hungry, medical services for the sick; making our streets safer, our courts more efficient, our transportation more accommodating.
Since changing policy is more difficult than changing practice, there are several practical steps governments can take now to create greater efficiency – many of which employ modern technologies.
1) Don’t settle for any price – drive towards best price
Governments routinely pay different – sometimes enormously different – prices for the same products (often from the same vendor). Occasionally these differences are justified, but more often they exist simply because they can. The lack of pricing transparency encourages vendors to charge what they believe agencies are willing and able to pay.
Pricing transparency helps buyers make more informed buying and negotiating decisions – and will encourage vendor pricing based more on value than simple opportunity.
**2) Value (and reward) results over process</p>
Buyers are more often rewarded for complying with purchasing policy than finding best solutions. Better said, there are far more negative consequences for missing a step in the process than buying an ineffective solution.
Maybe in some distant past, strict adherence to the process did, in fact, result in better outcomes. But that’s not the case today.
Measuring results – and particularly benchmarking them against similar agencies – can shift the focus back to what matters most. And, when buyers are rewarded for finding best solutions, they’ll find creative ways to get the process to work for them – not they for the process.
**3) Repurpose the best work of others</p>
The business of government in Tucson isn’t terribly different from that in South Bend or Charleston or Burlington. Yet we’re constantly duplicating and reinventing efforts across municipalities and agencies.
Best-in-class RFPs or an Agency’s experience with a particular vendor or the challenges of implementing a new system are all things agencies can share with one another. Repurposing the best work of others makes for better decisions, creates more capacity and increases the collective capability.
**4) Broaden the choice in vendors
The majority of government vendors have been servicing government for the past 40 years. The entrenched vendors have a vested interest in ensuring this remains so.
Despite this, a new class of vendor has emerged – using modern technologies and approaches – whose services often create better outcomes at more reasonable prices. And, despite the barriers that disadvantage them, forward-thinking agencies are finding creative ways to employ them.
5) Unburden government buyers
The broad talents of government buyers focus more often on insuring process compliance than finding best solutions.
Technology can easily automate tasks that consume buyer time – for example, all of the activities associated with finding, verifying, validating and soliciting potential vendors. In so doing, the extra buyer capacity this creates can be focused on understanding needs, evaluating options, monitoring performance and driving more effective results.
These are but a few practices agencies can begin to implement today. Companies are knocking at government’s door to provide tools and approaches in support of these practices. Our government’s work is too critical to not let them in.
Want to learn more about government purchasing? Stay tuned for more posts by Bob Sofman, Executive Vice President – Government Sector, SmartProcure, about the approaches and players who are making these best practices a reality across the country.</i>**</p>