Explore the influence of UK procurement reform on eSourcing. Gain valuable insights into evolving strategies, tools, and practices. Discover how procurement reform will navigate changes for optimised procurement in the digital age.
The much-anticipated Procurement Bill is still months away from being enacted, but buyers are being encouraged to start preparing now for the changes on the way. After all, failing to prepare is preparing to fail.
The Procurement Bill is expected to launch in the spring of 2024, which seems like a long way away, but when buyers have to revamp their procurement and eSourcing in supply chain management, that time can pass by in a flash. But, where to start? What functions and features will be affected? How can staff be prepared to work with the new regulations?
We’re going to explore procurement reform and take a look at how eSourcing might be affected.
First Things First
Appoint one person to manage the preparation and implementation of the process. This person is responsible for all things reform-related, for example, tracking the Bill’s progress, training staff, and implementing the changes once they’ve been defined.
The manager can work with a small team to plan how the changes will be rolled out. Team members also carry out essential actions, for example, ensuring the changes meet the reform’s primary aim, and comply with the new legal requirements and standards.
The Primary Aim
Transparency.
Transparency throughout the public procurement process so that anyone interested in public sector procurement can see at a glance the status of projects, the suppliers registered, and the buyers actively sourcing services, works, and products via tender opportunities.
Very importantly, buyers can pull up reports regarding supplier performance, delivery, and exclusion or debarment.
(Note: Exclusion is relatively rare and suppliers at risk of exclusion are given opportunities to rectify the problems.)
Objectives
The intention is to make all of the data more accessible through one platform, using a ‘noticing’ regime that covers the procurement process from planning to completion.
The transparency that results from the “noticing” regime and accessibility of information has a range of benefits for buyers.
- Buyers are exposed to a bigger group of suppliers, including SMEs and the global market.
- More suppliers equals greater competition, which enables buyers to benefit from lower prices.
- More competition drives innovation as suppliers work to stand out in the crowd.
- Buyers have greater negotiating power with suppliers.
Furthermore, transparency will be extended across all stages of procurement – planning, tender, award, contract, and implementation. For example:
During the planning stage, buyers must publish notices about upcoming procurement contracts.
- During the tender stage, buyers must publish all of the information about the contract, including requirements and bidding.
- During the award stage, buyers must publish supplier-related data, including the winning proposal and the factors that led to their selection, like bid and benefit analysis.
- During the contract stage, buyers must publish information related to the finalised contract, like total value, duration, tools, and KPIs (Key Performance Indicators).
- During the implementation stage, buyers must publish data on overall contract management, including KPI delivery and budget.
Impact on eSourcing
Esourcing is an essential step in the procurement process. In essence, it sets the stage for procurement to take place.
Much of what eSourcing does is related to tendering, from publishing the tender on the single procurement platform to awarding the winning bid. As a result, the strict focus on transparency impacts almost every function eSourcing serves.
ESourcing to procurement
Buyers advertise the project via the platform and a flood of interested suppliers respond. Using automated software, buyers select the suppliers that pique their interest and send out RFIs (Requests for Information).
Based on clearly defined criteria, automated technology sorts through RFIs and sends out Invitations to Tender (ITT) or Requests for Proposal (RFP). In the interests of transparency, these steps are published on the portal. This enables unsuccessful bidders to see where their proposals need some work and where they can emphasise their benefits to buyers.
It also enables other parties interested in responding to future tenders from the buyers concerned to see how to construct a proposal with a relatively good chance of advancing beyond the RFI stage.
From the proposal pool, suppliers are either sent a Request for Quotation (RFQ) or invited to an eAuction. A lot of eSourcing software automatically carries out these tasks, including eAuctions, to streamline the eSourcing process, saving time and money and facilitating smooth progress along the supply chain.
ESourcing specialists will analyse the quotes or the auction results to evaluate the suppliers according to the new criteria, which include social value in the assessment. They can also use the portal to find out more about the shortlisted suppliers, especially performance, delivery, accreditation, and regulatory compliance.
The winning bid
Buyers’ processes differ, so the final step, awarding the contract, can be managed by either the eSourcing or procurement teams. The information related to the final decision and awarding of the contract is particularly important from a transparency point of view.
The information supplied explains how the decision was made – the assessment and evaluation criteria and can also include the elements in the proposal that swayed the result in the winning supplier’s favour.
EProcurement Specialists Help You Manage Procurement Reform
New Procurement Reform practices will have a significant effect on eSourcing and procurement tenders and awards, most of which are based on the new focus on transparency in supply chains.
However, not all buyers have the time – or resources – to implement the changes that procurement reform will have on their eSourcing and procurement processes. Delta eSourcing can manage your entire eSourcing and procurement system, ensuring the changes are implemented properly and that you comply with new requirements.
For a smoother, more efficient, and cost-effective supply chain, contact Delta eSourcing and book a free demonstration to see how our services can help you.