StephenBauld.jpgIt is important to understand the process procurement managers go through before they will take the risk to adopt a new product for use in a municipal setting. Not only is it the many rules, regulations, bylaws and municipal documents, it is also how government procurement personnel react to new ideas related to goods and services.

“For government it relates to past performance in other municipalities, or some assurance that the good or service will be measured against some standard that is used to make sure the product is equivalent to what they are using at the present time,” says Stephen Bauld, President & CEO at Purchasing Consultants International in this month’s SmartProcurement.

Underlying any effort at performance improvements must be some form of systematic measurement. Generally, it is necessary to move from a point of known origin towards some intended performance target.

There are critical areas of concern when it comes to the development of an effective measurement system:

  1. The measurement system must be tied to the strategic objectives of the municipality.
  2. The measures must be balanced, including both financial and non-financial information.
  3. Measures should focus on a mix of process data and outcome or impact data, taken over time.
  4. Measures must be based on operational definitions: good measures are based on an organisation-wide system, using clearly defined and understood concepts and definitions.
  5. The measures must be within the organisation’s sphere of influence. (i.e., they must be tied to activities undertaken by the organisation).
  6. Measures must be dynamic, relevant and timely. They must adjust to growing knowledge in relation to the organisation.
  7. Measures must be interconnected and always reported collectively.
  8. Measures must provide a holistic view. It is best to focus on a limited number of key measures that reflect all facets of the organisation.
  9. Measures should be communicated to staff and documented. It is not enough to simply pass the result along: employees must be able to use the information provided to improve performance.
  10. Talk to all the staff, including procurement, the using departments and sometimes the council to convince them that your products will create value for money for the municipality.

To properly sell the concept of performance improvement planning, a purchasing department should gather information relating to many different aspects. In order for purchasing managers and other staff to make rational decisions they must have access to current, accurate and comprehensive data, provided to them on a timely basis.

For new companies the presentation of that information must done in a way that creates interest for the municipality to take the time to do research and development on your good or service.

For information contact Steven on swbauld@purchasingci.com