Procurement innovation may sound like an oxymoron, but government spending is a common thread in all of our most important policy debates: healthcare, infrastructure, tech. You name it. This post is a response to Jen Pahlka’s call for ideas leading up to Code for America’s 2018 Summit to improve how governments work with technology vendors to deliver better services and more cost-effective outcomes for every taxpayer dollar. That’s a goal we whole-heartedly support, and below are our suggestions for accelerating procurement innovation beyond the tech sector. This post was originally posted on Medium.
By Shalini Vajjhala, CEO of re:focus partners & co-founder of The Atlas Marketplace.
Communities across the country are looking for ways to leapfrog to smarter, more sustainable solutions and reach better outcomes for their residents. And in many communities, tech is beginning to trickle down to the everyday operations of departments traditionally unrelated to IT, like police and housing & redevelopment. But government procurement — the process of actually buying services and products like smart sensors, microgrids and flexible flood barriers — is often a stumbling block. If we don’t make major improvements to the procurement tools that government agencies are required to use, governments officials at all levels are inevitably going to replace failing systems with the same old fixes rather than transitioning to better, cheaper, more sustainable systems.
That’s a terrible outcome for taxpayers and residents alike.
Because our mission The Atlas is to help local governments scale proven urban innovations, we’re unabashedly enthusiastic about improving procurement processes too. It’s impossible to separate one from the other.
We have been working on innovative infrastructure procurement in the energy, transportation, and water sectors from inside and outside government for over a decade. And we’re incredibly excited about the energy that has emerged from all corners to fix broken procurement systems.
Trickle down tech
With smart sensors and IoT discussions entering every sector from energy to water to waste management, tech has begun to permeate nearly every city department. Public works, housing, police, transit…technology has begun to trickle down to all of these. As difficult as technology procurement is, the tech sector has one major advantage over lots of other sectors: iteration. IT systems evolve much faster than other large conventional infrastructure. For all those IT officials and vendors who have struggled through brutally slow and difficult procurement processes, we’re not saying the procurement in tech is fast or nimble, only that it has the potential to learn and improve more quickly in comparison to other sectors. As a reference point, just think about how much more frequently a city replaces software than it does a public transit system.
The comparative speed of turnover and tech service innovations offers an opportunity to experiment, iterate, and continuously improve procurement processes, where other more static sectors don’t have the same luxury. Water infrastructure is perhaps the most compelling counterpoint. The battle to replace 150-year old pipes is quietly raging under our streets, as various vendors and industry associations are working furiously to tilt the balance of hundreds of local procurement decisions. You can update a government website or replace servers on a fairly regular basis, but the stakes are higher with once-a-century procurement decisions. A city (hopefully) only buys a whole water system once in a generation.
We would love to see the kinds of govtech procurement innovations CFA is seeking through its Summit reach professionals from other sectors, like water utilities and transportation agencies, and to have the lessons learned from IT Directors, Chief Innovation Officers and vendors alike translated for small and medium sized cities that are all eager to leapfrog to smarter, safer, and more sustainable infrastructure solutions.
Procuring the wrong thing well is not a good outcome.
In our work in the water sector we’ve seen first hand the difference between between asking: “How can my city get the best value on a new water treatment plant?” and “What options do we have for reducing flooding in our city?” Both questions could be the starting point for streamlining procurement. They each frame an important problem, but the former presumes a narrow end outcome that limits possible solutions and the latter creates space for game-changing innovations in design and financing.
All procurement is a means to an end. Procurement innovation isn’t an end by itself.
It’s easy to lose sight of that, given how complex large procurement processes have become. Lots of efforts have focused on streamlining various rules, regulations, and purchasing processes. These things are all important, but less discussed and even more important is how to identify the ideal outcome and turn that vision into a clear scope of work (SOW). The sweet spot between focus, efficiency, cost-effectiveness, and creativity is tough to find. Government officials need better resources to help envision the best possible ends, not only support in streamlining the means.
Groups like the X-Prize Foundation have lots of experience in framing problems and competitions to generate the widest, most innovative, and relevant sets of possible solutions. Let’s bring these folks — the people with the most experience in framing problems to encourage creative problem-solving — together with government officials to frame better desired outcomes and scopes of work, before governments get into the weeds of procurement processes.
The best defense is a good offense.
Procurement is all about managing risk and liability. The risk of awarding contracts to inappropriate providers (a councilmember’s brother-in-law) or ending up far short of a prescribed outcome or service (the half-built transit system) are two among many that keep public servants up at night. Cities like Boston have flipped this dynamic on its head by using innovative procurement tools, like Requests for Ideas, to put the onus on vendors to show how their cool new thing can help Boston solve its core challenges. Boston had to do a lot of work to frame these challenges well (see above), but tools like RFIs, competitions, and performance-based RFPs can and should be far more widely tested and applied to attract new ideas, new partnerships, and new resources.
We’re tackling this problem now, in partnership with the Kresge Foundation and US Water Alliance, by working with six cities across the US to translate big city procurement experiments into replicable tools for smaller cities looking to tackle legacy water system issues.
Kudos to the Code for America team for reaching out widely. We’re glad to have the chance to #weighinonCfASummit and eager to hear what other folks think.
One of our favorite sayings is: “In theory, there’s no difference between theory and practice. In practice, there is.”
So here’s to fixing procurement in practice and making life better for government officials, vendors, and most importantly, the communities they both serve.
Want to learn more? Here are some more articles that may be interesting to you:
- Legacy infrastructure and the challenge of procuring urban resilience — by me and my colleague Aleka Seville: https://www.brookings.edu/blog/the-avenue/2017/06/05/legacy-infrastructure-and-the-challenge-of-procuring-urban-resilience/
- The Perils of Procurement by Jon Marks (Jon on Tech): http://jonontech.com/2009/08/25/the-perils-of-procurement/
- New Thinking in How Governments Deliver Services by Mark Headd: http://beyondtransparency.org/part-5/new-thinking-in-how-governments-deliver-services/
- Buzzword Bingo — by my Atlas co-founders Elle Hempen and Ellory Monkshttps://medium.com/cityspeak/buzzword-bingo-94cb1e32eef8