A Practical Guide to Transforming Procurement Systems

A Practical Guide to Transforming Procurement Systems

The Task Force on Procurement

The OECD DAC Task Force on Procurement has produced “A Practical Guide to Transforming Procurement Systems” as part of a suite of documents for the High Level Forum (HLF4) meeting in Busan Korea at the end of November 2011.

At a time when the strategic importance of procurement is increasingly being recognized the Guide:

• Provides practical guidance to transforming procurement systems
• Builds on, and is complementary to other Task Force publications, in particular its sister publication “Strengthening Country Procurement Systems: Results and Opportunities”
• Is intended to provide practical guidance on how to manage a procurement reform, modernization and/or capacity development process.
• Can be used at a national, sector or entity level.
• Also provides links to many existing resources from a wide range of organizations that can be used and adapted in support of these processes.

The principle and audience of the Guide is described as;

The fundamental principle of this Guide is that "procurement transformation" is essentially an internally driven process which responds to many factors both internally and externally generated. Therefore the Guide is targeted at those leading change in their own countries or organizations. However, it will also be relevant for others who provide support including donors, development partners and consultants. The Guide is flexible; intended to be relevant to all countries no matter the stage of development or level of maturity of the procurement system.

The Guide provides step by step guidance on the process of, assessment, strategic planning and implementation. It is designed to be contextualized and adapted, by providing focused guidance on the country context, national procurement systems, sectors, entities and individuals. It is intended to be user friendly and to respond to the different needs whether this is; seeking guidance only on part of the process, such as assessment; or those focused on a particular level, such as a sub-national procurement system. Each section provides information on existing tools that can be used or adapted, as well as links to other relevant resources. The annexes contain practical worksheets and tools.

The production of this guide was made possible by the collaborative work and commitment of the Task Force on Procurement. It is intended that the guide will contribute to further procurement transformation and innovation, helping facilitate ongoing adaptation and lesson learning.

It will be good to hear about different approaches and experiences.

Change management for transformation of procurement

Transformation of procurement and procurement systems subscribes to a larger process focused on personnel and the well-being thereof, beyond changing structures and systems. Change management, dealing with ‘transforming the behaviour of individuals’, is essential to the process and ‘not addressing change management can be one of the biggest impediments to the successful implementation of a procurement transformation’.

The ‘A Practical Guide to Transforming Procurement Systems’ highlights the importance of including change management in the transformation process, emphasising 10 key points ;

1. Don’t rush
2. Respect the value systems and foster self esteem
3. Scan locally and globally; reinvent locally
4. Challenge the mindset and power differentials
5. Think and act in terms of sustainable capacity outcomes
6. Establish positive incentives
7. Integrate external inputs into national priorities, processes and systems
8. Build on existing capacities rather than creating new ones
9. Stay engaged under difficult circumstances
10. Remain accountable to ultimate beneficiaries

The Guide identifies 9 reasons explaining why change projects fail;

1. Lack of clear ownership and commitment at appropriate levels in the organisation
2. Lack of a clear and powerful vision for what the outcome of the change initiative, failure to communicate that vision and lack of clarity about what is required in terms of “new” behaviors and approaches that is consistent with the new vision
3. No link to the core objectives of the organisation
4. No sense of urgency or the initiative was not given any serious priority so was under-resourced and everyone had their normal jobs to do at the same time.
5. Not removing obstacles to change
6. Failure to create quick wins and no follow through
7. Lack of effective engagement with stakeholders
8. Lack of skills and proven approach to project and risk management
9. Lack of follow through e.g. not finished, overtaken by the next initiative, lack of budget

6 examples to overcome these pitfalls are discussed; including incentives and leadership for change. The Guide emphasises reducing disincentives as opposed to new ones, and how coalitions of individuals can act as change agents and thereby provide a strong basis for leadership.

What is your experience of what has worked in transforming procurement systems?

How to make the Practical Guide more accessible and end-user friendly

The publication of the OECD DAC Task Force on Procurement, practical guide on transforming procurement systems has received positive feedback. The guide was written to be relevant for country partners to contribute to strong ownership of procurement reform processes. The current challenge is how to make this more knowledge more accessible and end-user friendly.

A recent flash poll of procurement practitioners identified that they most often obtained knowledge from guidelines and manuals (see results below).



In addition the second most common source of obtaining knowledge was an on line search for knowledge resources. A discussion on the types of knowledge and content needed for procurement to move towards a more strategic role can be found on the forum

So to make the guide more accessible and end-user friendly the content of the guide and supporting resources will being used as a key resource in a practical contextualized tool available in web Application(s) or APP. The App will facilitate sharing, rapid updates and ease of navigation, to help reach a global audience of capacity development and procurement practitioners, policy makers and advisers. The App will be supported by an enhanced procurement knowledge platform that includes; 1) searchable knowledge resources; 2) lessons learned; 3) discussion forums; and 4) dynamic content, accessible to end users.

The aim of the platform or web portal is creating a joint space for interested partners. This will strengthen county ownership and help facilitate transformational change as well as supporting going to scale.

The objectives of the web portal and Apps to support effective institutions are:

• To respond to the needs of partner countries and enhance ownership by giving access to and guidance on capacity development processes that supports an endogenous process;
• To create a platform for collaborations with development partners, partner countries and practitioners, that enables sharing of knowledge and good practice, as well as lesson learning;
• To support going to scale by enabling local leadership to own the capacity development process, allowing the partners to provide policy advice and guidance and facilitation;
• To provide a global common good which is an accessible entry point to guidance on developing public sector capacities, that utilizes forward looking technology solutions.

The intention is to finish the design and launch this web portal within a month of the HLF4 in Busan so it can also reflect the agenda and priorities for procurement and effective institutions. Kindly share any suggestions of features or functions you would like to see in this innovative approach so they can be included into the design.

Strengthening Country Procurement Systems: Results and Opportunities

The OECD DAC Taskforce for procurement sister publication to the Practical Guide is the publication Strengthening Country Procurement Systems: Results and Opportunities.

This presents the case material and country evidence from procurement system reform and from applying the OECD/DAC Methodology for Assessment of Procurement Systems (MAPS).
(See MAPS in French and Spanish).

It tells an interesting story of strengthening procurement systems through a series of diverse case studies including;

- Afghanistan: Where new laws have been passed, human capacity is being developed and plans are underway to decentralize procurement authority to key spending ministries.

- Mauritius: A model for procurement modernization in the Africa region and is leading in professionalizing the procurement function.

- Philippines: Where civil society and "people power" has been an engine for reform and to oversee achievement of results.

There are many more interesting and informative cases.

The publication brochure can be downloaded here.

Download the full publication on this link.

Procurement Capacity Development

The OECD DAC Taskforce on Procurement publication ‘Strengthening Country Procurement Systems: Results and Opportunities’ has an interesting chapter on Procurement Capacity Development. It has a series of six diverse country case studies from; Albania; Bangladesh; Bhutan; Kenya; Malawi; and Sierra Leone.

The review uses the OECD definition of capacity development “The ability of people, organisations and society as a whole to manage successfully their own affairs”. Each case is reviewed using the Good Practice Paper on Procurement Capacity Development five principles of; i) Country Ownership; ii) Broad Stakeholder Involvement; iii) Realistic Needs Assessment; iv) Strategic Procurement Capacity Development Planning; and v) Closely Monitored and Flexibly Managed Implementation.

The procurement capacity development review using the five principles concludes:

i) Country Ownership is illustrated as being a key feature for success in all 6 of the country cases, but particularly in the Albania case where the speed of procurement transformation increased dramatically once it became a national priority.

ii) Broad Stakeholder Involvement is a key theme in the Sierra Leone case where early and ongoing multi-stakeholder engagement and sensitisation has been a key feature.

iii) Realistic Needs Assessment is a feature both of the Malawi and Bangladesh cases where interesting approaches have been applied to capacity assessment.

iv) Strategic Procurement Capacity Development Planning is a key element in the Kenya and Bhutan country cases where the approaches have included flexible plans focused on realistic, achievable objectives and with implementation based on real performance indicators.

v) Closely Monitored and Flexibly Managed Implementation is demonstrated in the Bangladesh case where indicators are linked to milestones that trigger specific actions.

Do you have other capacity development cases where the 5 principles would be relevant?

Le post » Focus Areas » OECD DAC Procurement Task Force » A Practical Guide to Transforming Procurement Systems, #5 met en évidence l’appropriation nationale en l'Albanie comme un exemple de succès : ‘….l'appropriation nationale est illustrée comme étant un élément clé de la réussite.1 Le cas en Albanie, la vitesse de la transformation de l'approvisionnement accru de façon spectaculaire une fois qu'il était devenu une priorité nationale.

Le cas d’Albanie nous montre comment, sur une période de 10 ans, plusieurs reformes du système de passation des marches publics sont passe sans vraiment amélioré le system. Malgré de fréquentes réformes juridiques, le développement des capacités du système s'est avéré difficile à atteindre. Cela, jusqu'à la signature de l'Accord de Stabilisation et d'Association (ASA) en Juin 2006, ou l’Albanie s’est oblige de remplir une vaste gamme des objectifs courts, moyens et longs termes vers l'acceptation dans l'UE. Cela à amener l’Albanie a s’engagement d'aller vers le rapprochement avec les directives sur les marchés de l'UE, entre autre ……..‘d’accroître la transparence et éliminer la discrimination ainsi que le renforcement des capacités administratives et institutionnelles à entreprendre des achats en vertu du nouveau cadre législatif’.2

La clé facteur d’accélération du rythme de développement des capacités en Albanie, a été la volonté politique déclenchée par l'objectif de devenir membre d'UE. La question se pose ; peut-on vraiment appeler cela l'appropriation nationale ou est-il plus une question de gain politique et économique derrière un tel choix? Est-ce une incitation économique nécessaire avant que le leadership politique prenne la bonne décision d’appropriation nationale ?

L’approche de renforcement des capacités de PNUD souligne les incitations, soit économiques soit politique, comme clé facteur dans le processus de changement. Dans le contexte d’Albanie, l’appropriation nationale signifie que le Gouvernement a décide d’en faire une priorité nationale et le poursuivre avec tous ce qu’il faut. OCDE identifie l’appropriation nationale ainsi :

‘L'exercice effectif de l'autorité gouvernementale sur les politiques et activités de développement, y compris ceux qui comptent - entièrement ou partiellement - à des ressources externes. Pour les gouvernements, cela signifie articuler l'agenda de développement national et d'établir des politiques et des stratégies d'autorité’.3

• Es-ce-que l’appropriation par le gouvernement égale l'appropriation nationale ?
• Pourrait l’appropriation nationale aller plus loin ?
• Comment pourrait le peuple être représenté dans la l’appropriation nationale ; par la société civile?
• Et quel seraient les mécanismes?

Pour des ressources sur ce sujet, veuillez voir les postings sur ce Forum » Focus Areas » Anti-corruption » Civil Society Engagement in Public Procurement Process.

References;
1: OECD DAC Procurement Task Force ‘OECD DAC Procurement Task Force ‘Strengthening Country Procurement Systems: Results and Opportunities’
2: Idem
3:OECD, 2006, DAC Guidelines and Reference Series Applying Strategic Environmental Assessment: Good Practice Guidance for Development Co-operation, OECD, Paris.

Strengthening Country Procurement Systems: Results and Opportunities

The OECD DAC Procurement Task Force in 2011 commissioned:-

Strengthening Country Procurement Systems: Results and Opportunities

This was a retrospective review of progress, especially with regard to use of tools produced by the Procurement Task Force working group and impact of work at the country level.  The publication covers a survey of countries and highlights country examples that demonstrate reform and modernization, capacity development, performance monitoring and donor support in building systems and in using procurement systems.  A final chapter identifies key messages including recommendations for improving outcomes and seeking additional results.

This is an extremely valuable resource for strengthening procurement systems. The Authors summarize the lessons learned to improve the efficiency and effectiveness of capacity development efforts in countries choosing to work towards procurement modernization, as follows:

·         The OECD/DAC benchmarking tool, MAPS, has provided more than sixty countries with useful country specific information that has helped formulate a reform strategy or kick start additional change under an on-going process.

·         Human capacity development remains a key issue as the quality of every system depends on having qualified and knowledgeable people to manage and implement.

·         Decentralization presents challenges that affect a well functioning procurement system as capacity and skills are usually less developed when moving away from the center. 

·         Effective use of technology increases transparency, contributes to efficiency and provides information to stakeholders and managers that can be used to monitor and manage performance.

·         Reforms require resources, take time and require long term government commitment in order to bring about successful change.

·         The most successful procurement reform initiatives are country led and part of a broader public administration reform process which helps to ensure integration and prioritization of reforms.

·         The role of donors is evident in supporting reform initiatives and in providing advice and knowledge to countries, but lack of donor coordination and a reluctance to use country systems can have a negative impact on reform.

·         Stakeholders from civil society and from the private sector play an important role as drivers of change and overseeing results.

Are these lessons in line with your experience?

Can you apply them to country systems reforms that you are involved in?