NIGP Utah Chapter Meeting

September 16, 2014

Trends in Public Procurement

D. Michael Clawson CPPO, MBA

What is a Trend?

• A trend is a measurable or observable tendency or change in direction

• A prevailing tendency or inclination

• A general movement

• A current style or preference

8-Track Tape……a Trend?

New technology in 1983…AT&T passed on this technology at first because it didn’t expect it to ever attract more than a Millionsubscribers!

The mobile (?) phone!

What is a Trend?

• Since we all see the world from a different perspective, it is probable that we observe different things

References

• Don Buffum, CPPO• Darin L. Matthews, FNIGP,CPPO,C.P.M• Michael E. Bevis, CPPO,JD,CPSM,C.P.M.,PMP• John Adler, CPPO• Rick Berry, FNIGP, CPPO• Dr. Donna T. Ginter, CPPO,CPPB,C.P.M• Voight Shealy• Dr. Khi V. Thai, Ph.D.• David E. Dise, CPPO• Dr. Cliff McCue, Ph.D.• Dr. Stephen B. Gordon, FNIGP,CPPO,PH.D.

• “nothing new under the sun…especially in a conservative and risk adverse profession like ours”

• Is it a trend or trendy? A general tendency or the latest fad?

• Some people have been doing it for years; to others it is the newest thing.

• So……some may be trends, some may be old hat, some may not be on the radar.

Trend Buckets

• Tools and practices that have been around a while, are increasing in use while (sometimes) becoming more sophisticated

• Trends that Cause Concern

• Issues impacting Procurement

• True Game Changers

Tools and Practices• Cooperative Contracts

– More good ones available– Easier to access– Cooperative Contract Aggregators– More people are comparing– Asking a supplier to bring us the best

contract for our needs• Also – restriction against cooperatives

(see preferences)

Tools and Practices

• E-Procurement– People trying different aspects (catalog,

bid, quote, rfp, etc) one size does not fit all.

– Not the “cure all;” face to face sales is still important in many industries

Tools and Practices

• RFP– Looking for best value– Faced with more complex procurements– Faced with higher dollar procurements– Price, experience, Leeds, e-procurement

capability, many more criteria– Best value, total cost of ownership

Tools and Practices

• Performance Based Contracting– What is to be achieved; not How to do it

– Fully clarify and agree upon the best proposed solution

– Allows for new ideas, innovation, & creativity

Tools and Practices

• Strategic Sourcing– Looking beyond the tip of the iceberg

(price)

– Total cost, spend analytics, alternatives, supplier community, etc.

Tools and Practices

• Design-Build

• Reverse Auction

• Telecommuting

• Delegation (shrinking staff)

• Public – Private Partnerships (P3)

• Procurement Card

Tools and Practices

• More and better Standardized Practices

• Global Standards• Use of Social Media (facebook,

twitter, LinkedIn, etc)• Automation of non-value added

functions

Tools and Practices

• Performance Measurement• Best Value• Spend analysis• Data Driven Decisions (reporting,

metrics, dashboards, “Big Data”, “Business Intelligence”)

Trends that Cause ConcernState Certification Programs

GoodMore educationCan augment

international certification• CPPO proves

knowledge of over arching body of knowledge, State cert proves knowledge of state specific issues

Bad Limited resources for

training pulled in more directions

Different requirements reduce confidence in any one certification

Confusion

Trends that Cause Concern• Shrinking staff size• Local Preference• Concept that Purchasing is a road

block to stop the villains• An exiting experienced workforce• The issues and opportunities

presented by a new generation• “Over professionalized” work force

(ie. Purchasing Police)

Issues that have Impact

• Energy Efficiency– Was appliances and cars – sounded

good– Lighting – lamps, ballasts, controllers– Heating and cooling– Ice Storage cooling – Geothermal– BIG DOLLARS – Carbon footprint

Issues that have Impact

• Diversity– African American– Hispanic– Women– Veteran– Disabled– Small business– Others

Issues that have Impact

• Sustainability– Was recycled paper– Became recycling– Morphed into Green Procurement– Now Sustainability– Carbon Footprint awareness

Issues that have Impact

• Transparency

• Higher Standard of Accountability

• Reduced Staffing

• Reduced Budgets

• International Contracting

True Game Changers

• More Higher Education– Certificate Programs (Graduate

Certificate Program; Global Standard for accreditation of Purchasing and Supply Management programs

– Procurement Related Courses

– Logistics Courses

True Game Changers

• Professionalization of the Work Force– Certification

– Education

– Knowledge Building

– Research

True Game Changers

• Need for new Skill Sets– Customer service– Communication– Negotiation– Sales attitude– Analytics– Technology– Others…???

True Game Changers

• Maturation of the Procurement Profession

• Global Body of Knowledge– Common language– Common practices– Common skills

True Game Changers

• Procurement as a Strategic Player– At the table

– Providing input / expertise

– Involved earlier rather than later

– The “Go To” source for information

– Perceived value to the organization

True Game Changers

• Social Impact– Economic development

– Reduce hunger

– Provide water

– Improve infrastructure

– Procurement is everywhere and we can Save the World!

What did I Miss?

• Other ideas?

• What do you see?

Thank You!!!

Utah NIGP Rocks!

D. Michael Clawson, CPPO, MBANIGP Governing Board / Talent Council

City of Sierra Vista, Arizona

Michael.Clawson@sierravistaaz.gov

(520) 458-3315