Potential pitfalls exist throughout the process when procuring services. From getting the requirements right all the way to negotiation and contract management, procurement professionals need a clear plan for executing the process.
Planning the process
Upfront preparation is key to the success of any procurement exercise. So analyse and clarify the need thoroughly. Don’t enter into a procurement process until the requirement itself, and the intended result, are clear. The success of a procurement process should be measurable, so try in advance to define what a successful outcome will be.
Two of the most common risks in any project relate to time and money. In services procurement this is even more crucial. A project which gives tenderers insufficient time to prepare a submission will result in inadequate or inaccurate responses. A project with insufficient funds to meet the established need is likely to result in sub-standard delivery and/or delays in making purchases. It may even mean the need to re-tender.
Be realistic in planning a services procurement process and keep things transparent.
Communication and clarity
All parties involved in a procurement process need to have a clear understanding of the detail involved and the required outcome. This means clarity amongst those managing the process, buy-in from the end users and stakeholders and a full understanding of requirements by tenderers. Clear, coherent and consistent communication is essential to achieve this.
Poor internal communication could mean misunderstood requirements, leading to mixed messages and a perceived lack of professionalism. Poor communication with tenderers is likely to mean that responses are not fit for purpose, or some degree of advantage has been given to certain companies.
Poor communication with end users and stakeholders could result in an inappropriate purchase being made, an aborted process or even the need to re-run the procurement. If this happens, it means lots of wasted time and money.
The clarity with which your procurement process has been planned should be upheld in the way it is briefed and discussed throughout its duration.
Supporting best practice
In order to maximise the chances of a procurement process running smoothly and effectively, procurement staff should be supported appropriately. This support stems from the environment in which procurement is managed. It’s important to implement and clarify best practice policies and directives and to promote ethical behaviour. Appropriate training should be given, enabling procurement staff to carry out their duties with confidence and to support those non-specialists involved in the process.
Support should be given to process managers during the course of procurement, and a review framework should exist in order to feedback and discuss learning.
The risks associated with insufficient support are great – from inefficient use of resources to unacceptable purchases.
As well as training and supporting procurement staff to improve efficiency and effectiveness, some degree of monitoring also needs to take place to ensure procurement integrity.
A review framework not only allows staff the opportunity to learn and progress, it offers management the chance to keep tabs on staff and standards. Although misuse of resources and inefficient budget spend need to be minimised, the potential for claims of favouritism or unethical conduct are the real concerns and bring with them the risk of litigation and cost.
It may well be prudent to enlist the services of an outside adviser to monitor ‘probity’ – the morals and ethics of compliance – during more high-profile procurement projects.
A checklist for the services procurement process
Consider these key actions, as well as project-specific ones, whenever creating the framework for a procurement exercise:
- Analyse the procurement need thoroughly and accurately
- Obtain a definition of the need, and confirmation that all approvals are in place
- Clarify timeframes and budget available
- Ensure communication with all parties is clear, consistent and ongoing
- Provide appropriate training
- Ensure support frameworks are in place
- Ensure review frameworks are in place
- Ensure the process is properly monitored
- Set good examples – nurture an environment of integrity