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Public procurement professionals often need to ask themselves, “Should we innovate, or can we use our traditional sourcing methods more effectively?” Many state central procurement offices have answered “Both!” to this question with much success.
Innovation continues to be a buzzword. We often hear calls for government innovation and rethinking public procurement, especially due to budget constraints or to keep up with the fast pace of innovation in technology.
Innovation can mean implementing new or better solutions. These could include changes as simple as a facelift to a traditional procurement method, adopting a new approach such as modular procurement, simplified multi-step bidding, communications with the supplier community prior to issuing a procurement opportunity, or allowing the state to test new technologies before procuring them. Sometimes, the most innovative ideas come from procurement professionals in the trenches who work closely with stakeholders and can offer helpful feedback.
$180 billion – that is the estimated economic loss the United States will experience by the end of the century if no action is taken on climate change. States are increasingly interested in implementing sustainable purchasing practices and can often use their unique geographical locations and physical attributes to their advantage. Thinking creatively is key when diving into the world of sustainable purchasing, and in this post, we will explore some of the ways states are setting exceptional benchmarks in the pursuit for clean and storable energy.
In 2016, the “House Bill to Promote Energy Diversity” was signed by Massachusetts lawmakers. This bill, in part, directed utility companies to solicit offshore wind contracts by June 2017, requiring output every two years of at least 400 megawatts (MW) each. Each megawatt is equal to one million watts, which means that each MW can translate into power for hundreds of thousands of homes, depending on usage. Massachusetts’ ultimate goal is to generate 400 MW of storable wind energy, every two years, off the coast of Martha’s Vineyard by placing wind farms in federally-owned waters.
Have you ever been frustrated at the slow internet speed, or experienced buffering while streaming a live ball game, or your favorite TV, Netflix, or Hulu show? We’ve all been there. In many cases, the slow speed is not intentional, but due to poor server configuration or high traffic providers are experiencing at a particular time. Now, imagine this has become the norm, because of government deregulation that now allows Internet Service Providers (ISPs) to dictate which customers get faster or slower traffic depending on how much customers pay for their services. Welcome to the network (net) neutrality debate!
To some, net neutrality may seem like just another new buzzword, but it is not a new concept. Back in the 1960s, AT&T had a monopoly of the phone industry, and the Federal Communications Commission (FCC) had to step in so that market competition was fostered to give consumer more options, as well as lower prices.
Those in favor of net neutrality believe that ISPs and network providers should treat their customers (a.k.a. “traffic”) equally as they navigate to and from any web site, application, or device. Being “net-neutral” refers to ISPs not artificially slowing down, speeding up, throttling, or setting data limits for any resources the customer is trying to access through the ISP’s connection. Keep in mind, a “customer” in this context can refer to a consumer in their home, a business, or a government agency. In other words, proponents of net neutrality argue that ISPs should not be allowed to play favorites and allow online content providers (or content owned by the ISP’s parent company) preferential treatment over another, especially if one provider pays more than another for traffic. What does this all mean? Large private businesses with deep pockets could get faster internet while the rest of us watch the buffering icon spin.
Welcome to Procurement Pulse!
Procurement by federal, state, and local governments in the United States amounts to $7 trillion dollars of annual spend, and state procurement makes up a significant portion of that number. With a dollar amount that contains that many zeros (twelve of them, to be exact), it’s not hard to see why discussing and sharing ideas on best practices and emerging issues in state procurement is of utmost importance.
NASPO’s Procurement Pulse aims to be your go-to resource for emerging and horizon issues in state procurement. NASPO staff and members will be bringing you engaging and relevant content on a myriad of procurement issues, including, but not limited to NASPO’s Top Ten Priorities for State Procurement and Top 3 Horizon Issues. Check out these key rankings for 2018 straight from state Chief Procurement Officers (CPOs) at the bottom of this post.
Procurement as a profession is evolving at a pace that is increasingly in step with technology. While procurement was once seen as a transactional, process-driven function, technology is freeing us up to play a much more strategic part in driving organizational efficiencies and savings. Gone are the days of hanging out in the basement, pushing through stacks of purchase orders, and making purchasing decisions based on hunches. We are now being brought to the forefront, breaking out of silos and using data to make smarter decisions that drive savings for the enterprise.
As this transformation occurs, procurement leaders need to recognize the shift in skills that is needed for their office to stay in front of the wave. Much of what we looked for in a procurement officer in the past came down to several soft skills, which still form the foundation of what we look for today: Are you a good problem solver? Can you work with a variety of personalities? How do you handle stress? With these soft skills in place, a resourceful and hard-working new hire could hit the ground running and learn the technical aspects of a procurement job on the fly.
If you’ve ever been faced with the frustrating situation of having a Phillips head screwdriver in hand when you actually need a flathead, then you know what it’s like to not have the right tool when you need it. To deal with the myriad of issues they face on an almost daily basis, state procurement officials need all the tools they can get their hands on, and modular or iterative procurement is a key addition to the toolbox.
Modular and Agile methods can be game-changers in procurement offices, especially when it comes to IT procurement. Recently, NASPO and NASCIO joined forces by bringing State Chief Procurement Officers (CPOs and State Chief Information Officers (CIOs) together to talk about how to improve IT procurement. One of the key recommendations of the task force of CPOs and CIOs was to “use iterative/non-waterfall procurement methodologies when appropriate to improve procurement cycles, add flexibility, and reduce risk.” Everyone agrees that Agile and other iterative procurement methods are the future of state procurement… but how do we get there from here?
The road to true iterative procurement can be a rocky one, and if a state procurement office doesn’t plan well, those rocks can turn into boulders. It is key to think through the switch-over to non-waterfall methods, communicate with staff and key stakeholders about the changes being made, and constantly re-evaluate whether what is happening is working toward the betterment of the procurement process.