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How to make public procurement smart and sustainable by design

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Written by Warren Smith, Associate Director, commercial lifecycle consultancy

Look beyond the digital and technology functions to deliver impactful, sustainable digital transformation, says Warren Smith in this Amazon Web Services Institute blog

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Whole-of-government digital transformation must be based on internet-era principles, methods and work practices. Multi-disciplinary teams that are user-centred, design-led, data-driven and work in the open are successful. This approach can turn blocks to modernisation, such as procurement, into change accelerators. 

 

Complex, not complicated

Procurement is a critical and under-leveraged area of public policy, governance, transparency, and accountability. With the global cost of corruption, fraud and bribery estimated to cost the global economy US$3.6 trillion every year, public procurement has the potential to ensure vast sums of money are directed towards investment in vital public services.

Procurement isn’t complicated. However, in the public sector context, it is complex for a variety of interconnected reasons.

First, procurement is big business and can be opaque. The Open Contracting Partnership and Spend Network estimate that, globally, governments spend US$13 trillion each year through public contracts, but less than three per cent of that is publicly declared. 

Second, procurement is highly regulated in most countries. This governs principles such as transparency, fairness, equal treatment, non-discrimination and proportionality, information to share publicly via notices, procedures and systems to use, and timescales.

Third, years of organisational custom and practice create bureaucracy: procurement customs become misinterpreted as statutory law.

Finally, procurement carries integrity risks throughout its cycle, from pre-tender to post-contract award. An Organisation for Economic Cooperation and Development (OECD) report Preventing Corruption in Public Procurement found that of the cases reviewed under the OECD Convention of Bribery of Foreign Public Officials in International Business Transactions, 57 per cent occurred to obtain a public procurement contract.

 

Public procurement needs service design

There are four important conditions that produce benefits for citizens, civil servants and governments around the world.

  1. Mainstream, human-centred design, data-driven and open approaches in public procurement;
  2. Invest in multidisciplinary and cross-functional teams, which are founded on the right working practices, behaviours and culture, based on honesty, transparency, collaboration and integrity;
  3. Use public procurement approaches that are fit for the 21st century, as a lever to achieve inclusive, equitable and sustainable policy outcomes that have positive economic, social and cultural, and environmental impacts; 
  4. Seize the opportunities provided by digital government, open data, new technologies, and innovation, throughout the full public spending lifecycle – from planning, informing the market, evaluation and award, and managing delivery.

 

Between October 2018 and April 2021, I led the Government Digital Service (GDS) Global Digital Marketplace Programme. The UK Foreign, Commonwealth and Development Office Global Anti-Corruption Programme funded this initiative as part of the former Cross-Government Prosperity Fund. I worked on projects in Colombia, Indonesia, Malaysia, Mexico, and South Africa. For one project in Indonesia the team collaborated with specialists from World Commerce and Contracting to co-design government contracts for the digital age. This work naturally built on what we had achieved with the UK government. 

I’ve shared the UK story in the full version of this blog, written for the Amazon Web Services (AWS) Institute, and in a short video. The UK story illustrates that even if the challenges can seem great, the significant results make the transformation process worthwhile.

Read the full article with the UK story


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