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What public sector procurement reform means for you

In recent years, public sector procurement in the UK has undergone major reform – with collaborative working being promoted as a key way to cut costs, increase efficiency and transform working practices. 

The thrust of these reforms is being driven by the Crown Commercial Service (CCS), the new Cabinet Office executive agency that has assumed the functions of both the former Government Procurement Service and procurement management teams within Whitehall departments.

The CCS has been tasked with guiding the public sector as it strives to make major savings from a combined annual procurement budget of £227 billion. It aims to improve the quality of commercial and procurement activity across the sector in a number of key ways, including:

1.    Centrally managing procurement of common goods and services
2.    Providing specialist resource for managing complex procurements
3.    Improving supplier and contract management
4.    Sharing the benefits of aggregation across the wider public sector

The CCS is certainly riding a wave. In recent years, the pendulum has swung towards a more centralised approach to procurement. And thanks to new technology, this doesn’t necessary mean less choice for smaller public sector organisations.

Indeed, initiatives like the G-Cloud prove that the opposite is often the case. The G-Cloud procurement model allows you to access an online ‘CloudStore’, where you can buy a huge range of government-approved Cloud services from over 1,500 vendors, large and small. Any UK public sector organisation can source cloud software or hosting infrastructure from this online G-Cloud catalogue without the need for a full tender or mini-competition, making procurement cheaper, faster and a lot simpler.

G-Cloud procurement is built on collaboration between public sector organisations and private software vendors. And increasingly the public sector is being challenged to extend the principles of collaboration to all of its procurement activities – particularly because it allows organisations to make significant savings that don’t affect front line services.

It’s a challenge the sector has largely embraced. A 2010 National Audit Office / Audit Commission survey found that of those interviewed, 45 out of 48 local authorities, 76 out of 82 central government organisations and 53 out of 57 health trusts had undertaken spend using collaborative arrangements. The majority felt there were clear benefits to doing so:

•    84% said collaboration had helped achieve better value for money
•    83% felt there was further potential to improve value for money
•    82% said collaboration reduced the number of contract tenders
•    73% felt it resulted in faster procurement

Since this survey was completed, advances in technology have made it even easier for public sector organisations, potential suppliers and contract holders to collaborate throughout the procurement cycle. In many cases, use of cloud collaboration software has not only made procurement cheaper and more efficient, but it has also resulted in innovative new methods of procuring goods, works and services.

Why? In the words of Dan Rowinski, mobile editor at ReadWrite, Internet-based systems like cloud collaboration software “enable innovation, allowing people to build efficiently on layers of technology laid down by their predecessors.” For this reason, “the future is built by people exploring the art of the possible… and pushing past it.”

We strongly believe that being able to explore the ‘art of the possible’ via collaborative working is the most significant benefit to emerge from current reforms in public sector procurement. In upcoming posts we will show you how growing numbers of organisations are putting collaboration at the heart of their procurement cycles, and using it to work better and smarter with colleagues, partners, suppliers and contract holders.

As you’ll see, reforms that were primarily motivated by cost-savings and efficiencies are likely to make future public sector collaborative procurement faster, more integrated and – above all – innovative by default. Without doubt, that’s an outcome to be welcomed.

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