Demystifying Agile Procurement (Industry Perspective)

Moving away from the stale and dated modes of procurement can drive efficiencies and make for better outcomes for all involved.

by Jim Bard, Accenture Health & Public Service / May 16, 2018
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When most people in government think about the procurement process, terms like "bureaucratic," "requirements-driven," "rules-focused" and "lengthy" often come to mind.
 
Public-sector chief procurement officers today have a tremendous opportunity to apply agile thinking to government procurement processes, even for complex services and solutions, to deliver targeted outcomes faster. The first requirement is that senior leaders, agency program managers, IT professionals, government lawyers and procurement experts must shift from a process-focused to an outcome-focused mindset.
 
The change in mindset starts at the point when a need is identified within an agency. The critical first step is for the relevant program experts and leadership to clearly articulate in writing the desired outcome of the procurement, with a heavy focus on end-user perspective. For instance, the focus might be on providing more actionable information to social service caseworkers in the field, or on a solution to better enable planning, development, execution, storage and management of contracts across an enterprise. 
 
To help capture how the success of the solution will be measured, the next step is identification of specific performance metrics with minimum target thresholds. Examples could include solution availability percentage, data completeness and accuracy percentages, solution response time and process cycle times. 
 
Procurement staff can then take this type of high-level, outcome-focused framework and develop a short RFP inviting vendors to co-create solutions with the agency to deliver the targeted outcomes at acceptable target thresholds. Included in the RFP can be the agency terms and conditions that are required by statute or rule. An initial question-and-answer process can be conducted for interested vendors to clarify and better understand the government’s need. 
 
Vendors can use the information in the initial RFP and question-and-answer period to develop and submit a proposed solution to showcase their delivery approach, relevant experience, and to differentiate themselves from competitors. An evaluation committee composed of key agency stakeholders (e.g., program managers, IT professionals, procurement professionals) could then review the responses and move the best ones to a short list.
 
With the short-listed vendors, a series of iterative working meetings could focus on co-creating the best-value solution. During this part of the process, vendors and agency staff would work side-by-side to openly exchange information and develop a better understanding of the agency’s operating environment, needs, wants and priorities. Assumptions would be jointly discussed and agreed upon, and innovative ideas from both government officials and vendors considered. 
 
At the conclusion of the working sessions with the short-listed vendors, some or all could be invited to submit final offers to capture the details of the mutually developed solution, specific pricing and defined approach to delivery. Vendors remaining in the running can also provide with their final proposal any requested additions to the agency’s standard terms and conditions based on the scope of the final offer.
 
This type of more agile approach would be in stark contrast to the predominant procurement approach in most government agencies today. Instead of procurement offices putting a great deal of time and effort into conducting extensive market research, developing detailed specifications and requirements, creating elaborate solicitations and conducting time-consuming reviews of voluminous proposals, there could be a much tighter process of government-vendor collaboration to more efficiently and quickly co-create best value, innovative solutions to address agency and citizen needs. 
 
Procurement statutes or rules should not stand in the way of this proposed agile procurement approach, since it still involves using open competition to help drive best-value solutions for taxpayers. The agile approach maintains competition among vendors while helping government better harness private-sector innovation and creativity through the focus on desired outcomes rather than detailed specifications or requirements.
 
Agile procurement is based on a greatly streamlined and more collaborative processes than is currently found in most state government agencies. It provides vendors with the detailed information they need to understand government needs and priorities, on a more focused path to targeted outcomes. Applying the agile approach to government procurement is about overcoming outdated modes of operation, to evolve agencies to meet citizen demands faster, more effectively and at lower cost to taxpayers.
 
Jim Bard is a principal director for health and public service for Accenture.