Procurement 2.0: Are You Ready?

Procurement 2.0 is still a hush-hush topic that has reached the office corridor discussions. There are still many unanswered questions. Will it be different from the aging e-Procurement? As one procurement manager even mentioned; it could offer a more robust solution than e-Procurement. This article is about the possibility of Procurement 2.0. What is it? Well, the Wikipedia will not give you any description just as yet.

In the US, the series of stimulus packages that have recently been rolled out will unleash a surge of dynamic and transformative changes in governance and how the government will transact business in the future. First, the government’s throughput must be improved to take-in the unexpectedly large loads. To make this happen, there will be massive streamlining of governance structures at hyper-speed. Transparency will be paramount in all dealings. Oversight functions will be strengthened. And as soon as new projects in transportation, public highway construction and other infra related projects start in many states, these transformation processes will ripple through. Donald McDonald is tracking how the States are using the American Recovery and Reinvestment Act of 2009 (ARRA) stimulus funds in his blogsite.

Procurement systems will not be spared. There will be pressure to improve, build-on if not totally replace the aging enterprise based and web 1.0 systems . In fact, the fusion of this need for dramatic innovations and the Web 2.0 technologies will create new possibilities that have never been before possible. Here are a few changes which are already feasible in the current state of the art:

1. Collaboration will be tightened. What started as a humble “sharing of best practices” in the 90s is ready for take-off in Procurement 2.0. Government learn how to openly share and streamline sharing using off-the-shelf solutions, the way Facebook and other social networks did. As an example of how quickly a professional network can establish itself through a viral growth process, look at GovLoop. This procurement forum is another initiative in this direction.

2. Procurement intelligence structures will be built. Intellipedia was created by the US Intelligence to share information on some of the most difficult subjects and to bring cutting-edge technology into its ever-more-youthful workforce. Its success will rob-off to procurement systems that will allow information to be assembled and reviewed by a wide variety of sources, agencies, experts pool and peer bodies. Click below for a brief introduction.

3. Transparency on steroids. Textual documentation of proceedings for bid meetings and openings which require a lot of time, papers, and whatever happens will always be incomplete will be replaced by videos which are deposited in a Youtube (and others, like Vimeo) channel for everyone to see and review. This can likewise percolate to other processes such as RFP announcements, pre-selection, pre-qualification, and so on.

4. Interactive documents. The concept of the “smart” documents of yesteryears will be greatly improved. Gone will be the days that we need to do more retyping of the static PDF files rather than thinking through the procurement issues. Future documents will be more intelligent and interactive. They will likewise be placed in secure web repositories where intended users can access them at specified time wherever they might be.

These changes are supported by U.S. President Barack Obama’s recent pronouncements on how the U.S. government is changing how government contracts are awarded and who can get them. The president says the move will make the process more competitive and will save taxpayers up to $40 billion a year.

How can the DMCs start preparing for these transformative changes? What capacity building challenges would are needed? What capacity assessment questions can we formulate right now?

Posted by Ed Canela, Consultant

Photo Source: Australian Department of Finance and Deregulation