Enterprise Resource Planning (ERP) systems have become an essential tool for complex organizations, but when it comes to procurement in the public sector, they aren’t enough. 

As public procurement partners, we speak to many procurement professionals at public sector agencies, and we frequently hear one common refrain—that they feel imprisoned by their ERP. For many of them, their organizations have invested a lot of time and money in ERP systems that do many things well and are there to stay. But to make them work as general admin tools requires a lot of finessing and fitting square pegs into round holes—leaving too much of procurement up to error-prone manual processes. If that sounds familiar to you, it’s because procurement in the public sector involves unique challenges that ERP systems built for corporations were never designed for.

Here are the specific areas where they tend to fall short:

1. Limited supplier reach: ERP systems don’t go far enough when it comes to reaching and managing suppliers. There’s often little visibility into supplier performance and risk, limited supplier collaboration and communication, and little or no ability to manage supplier contracts and agreements. Not to mention, ERPs can’t connect you with the vendor communities and networks that sometimes come with a dedicated procurement solution, which means that fewer qualified vendors see and bid on your agency’s solicitations in the first place.

2. Contract management frustration: ERP systems might have basic contract management capabilities, but they can’t handle the whole contract lifecycle, from creation to execution and renewal. Procurement software offers a one-stop solution that covers the whole range of contract management challenges.

3. No integrated workflows: ERP systems don’t provide integrated workflows or automatic approval management, making it difficult to set up and maintain efficient procurement processes. On the other hand, purpose-built procurement software gives you control over your workflows and approvals, often with added features like notifications and integrated messaging, all of which makes it easier for you to get your job done.

4. Spend analysis shortcomings: ERP systems don’t provide detailed and actionable spend analysis to help you and your stakeholders save money, but specialized procurement software gives you a complete view of your procurement spend, helping you track and find cost-saving opportunities.

5. Weak vendor performance tracking: ERP systems don’t provide robust vendor performance tracking capabilities, making it difficult to make sure your suppliers are living up to their obligations. Meanwhile, purpose-built procurement software collects feedback from stakeholders and gives you real-time data and insights to help you monitor supplier performance and ensure compliance.

6. No collaboration: ERP systems don’t provide support for collaborative procurement, making it difficult for procurement or evaluation teams to work together. Purpose-built procurement software provides a platform for collaboration, helping procurement teams achieve better and faster results.

7. No eSourcing: ERP systems often don’t have eSourcing capabilities, making it hard to manage sourcing events electronically. There isn’t a place for procurement and its stakeholders to build solicitations and RFPs collaboratively, no place for suppliers to see your solicitations or submit bids, no support for sealed bids, no bid evaluation tools, and no integrated way to track internal and external communication that may be needed later to support a purchasing decision.

8. No supplier diversity tracking: ERP systems don’t have the capability to track supplier diversity, making it difficult to monitor diversity goals and initiatives or even comply with regulations. Purpose-built procurement software has tools to help procurement professionals meet diversity goals and requirements.

9. No support for strategic sourcing: ERP systems don‘t offer support for strategic sourcing, which is critical for optimizing spend and driving savings. They’re not tied in to co-op and piggyback sourcing opportunities, and they can’t bring all your sourcing data together to help you make better purchasing decisions. Purpose-built procurement software has the tools and insights you need to support your agency’s strategic sourcing efforts.

10. No audit trails: ERP systems aren’t equipped to collect and store all the data and communications an agency needs when facing a supplier dispute or regulatory trouble, but a built-for-purpose solution will record everything important, and even guide users towards defensible decisions – by flagging outlier evaluator scores or requiring written justifications from evaluators, for example. 

ERP systems are great for many things, and are integral to many public agencies’ core functions, like finance management and HR. But when it comes to procurement, they simply don’t have the capabilities needed to support procurement professionals. Luckily, there are alternatives built just for public sector procurement, coming with all the tools and capabilities you need to achieve procurement excellence. And you don’t have to give up your ERP, either. Many procurement software packages offer integrations that can exchange data with your ERP, making purpose-built procurement software the perfect ERP complement.

Mitigating risk is one of the most important responsibilities an organization’s finance leader has. So why do so few pay close attention to procurement, an area bristling with risk? Can they trust that others in their organizations are looking after those risks, or is this a potentially dangerous blind spot for them?

In this blog post, we’ll take a look at the risks inherent in public sector procurement and why finance leaders should care. Finally, we’ll show that it isn’t all doom and gloom by outlining some steps public sector finance leaders can take to assess and improve their agencies’ procurement risk profiles.

 

Ten risks intrinsic to public sector procurement

The risks inherent in public sector procurement are wide-ranging. Here’s what it looks like when they’re not well-managed.

• Procurement requests are frequently delayed or forgotten entirely. When there’s no formal system to receive and track procurement requests, they can sit unaddressed for a long time, wasting time right from the outset that can’t be recovered.

• The right vendors don’t see your solicitations, so you can’t get the best services, goods, and value for your stakeholders. The best solicitations in the world can’t get results for your agency if they’re hard to find.

• Unqualified vendors are allowed to bid because there isn’t a system in place to screen bidders for necessary qualifications and certifications. That means you waste time sorting through bids that can’t be considered or, worse, you get all the way through the evaluation stage before realizing not all bidders meet the qualifications.

• Evaluations are unintentionally corrupted. For someone trying to mitigate risk, evaluations are one of the most challenging areas of procurement because evaluations are often qualitative and subjective. An evaluator’s failure to understand the evaluation criteria, a hasty reading of the bid details, or unconscious cognitive bias can all lead to suspect evaluations that can’t withstand scrutiny.

• Evaluations are deliberately corrupted. In addition to unconscious bias, there’s also deliberate bias to worry about, which leaves an agency open to accusations of unfair or discriminatory dealing. If evaluators can score bids any way they like, with poor reasons or no reasons given, it becomes impossible for an agency to defend its procurement decisions.
  
  In the absence of risk-mitigating controls (like requiring evaluators to provide reasons for their decisions), even well-intentioned evaluators can let their assumptions and biases lead them towards counterproductive and risky habits that eventually become organizational norms.

• Approvals create bottlenecks that disrupt procurement timelines. Procurement is often the last thing on approvers’ minds, so without a system to keep approvals moving, they languish. At best, time is needlessly wasted; at worst, critical services and supplies aren’t procured as promptly as they’re needed.

• Poor record-keeping exposes the agency to regulatory and PR risks. To avoid an uncomfortable spotlight, public agencies have to be above suspicion and ready to respond to questions and disputes with credible records and facts. Without help from automation and technology, this is a practical impossibility.

• Rogue purchases occur because nobody wants to work with procurement. It’s human nature to go around obstacles that get in the way of our goals. When people treat the procurement department as an obstacle rather than providers of a valuable service, they cut corners that expose the organization to risk.

• Important knowledge doesn’t become institutionalized. In many organizations, people know how to do their jobs well, but nothing’s written down or systematized. This leaves an agency vulnerable to losing key people and finding itself unable to function.
• Poor vendor performance goes unnoticed or unaddressed. This risk is one of the most dangerous because it quietly drains value from a community, year after year, while remaining just under everyone’s radar. It’s usually only when something really egregious happens that this problem gets attention, but by then the damage is done.

What to do about procurement risk

While the list of procurement risks can be daunting, there are software solutions available to manage them. 

Procurement software offers a range of benefits, including streamlined procurement requests, vendor qualification, and minimized corruption in the evaluation process. It can also speed up approvals, reduce bottlenecks, and maintain reliable records to avoid regulatory and PR risks.

Moreover, procurement software can encourage cooperation with the procurement department, institutionalize critical knowledge, and ensure poor vendor performance isn’t overlooked. By using benchmarks and community data, the most capable software solutions can identify and solve common procurement problems.

It’s important to note that not every agency needs cutting-edge functionality in every area, and the most expensive solution is not necessarily the best. The key is to find software that addresses your agency’s specific needs. The best way to know what your needs are is usually through an internal risk assessment that compares the current state to the desired state and identifies the gaps between them.

Public sector procurement simply has too many moving parts for people to keep track of and manage without some help from technology, which is why procurement software is an essential tool for public sector agencies. By identifying and investing in software that meets your agency’s specific needs, you can achieve significant improvements in your procurement processes while reducing risk at the same time.

We recently chatted with seasoned procurement pros at our OntarioTalk event, and they had some great compliance advice that applies to all jurisdictions.

Our panelists included:

• Hend Salem, Manager of Strategic Sourcing – Non Clinical at The Ottawa Hospital
• Carol Izzio, Director of Procurement at Sheridan College
• Christine McParland, Director of Residence and Ancillary Services at St. Lawrence College
• Luca Del Grosso, Manager of Procurement at Technical Standards and Safety Authority

They all shared their experiences and what worked well in their agencies. Find the summary of their advice in this article or watch the full conversation here.

 

 

2. Leadership support

Like most things, procurement compliance starts at the top. While procurement can create the initial policies and procedures, leadership gets the final say.

If you’re pushing compliance across all departments that you work with, making sure your leadership team has your back is essential. This ensures your internal stakeholders understand that you’re not forcing them to follow made-up rules, but adhering to corporate-wide policies to make sure things run smoothly, are risk-averse, and follow the law.

Ask yourself these questions:

• Has my leadership team reviewed and approved all policies?
• Does leadership have a process for enforcing policies?
• Does leadership support procurement education for other departments?

 

3. Internal client education

Educating internal clients on procurement compliance is incredibly important—which all our panelists echoed. They need to understand what they’re complying with, why, and how to stay compliant, or else they’ll do what they feel is best. Educate on the benefits to both them and the organization if the rules are followed—such as spending budget efficiently, increased transparency, avoiding legal issues, streamlined workflows, etc.

Ask yourself these questions:

• Are there any educational sessions on procurement for other departments?
• How are new hires introduced to the procurement process?
• Is it clear to everyone how procurement works and their role in the process?
• Do others understand why policies exist and how to adhere to them?
• Do all other departments have easy access to policy and procedure documents?
• Do others understand the risks associated with not following policy and procedures?

 

“We are not policing [internal stakeholders] or policing how they are spending budget but they are accountable for the budget, the risk, and the spend. It’s not a procurement policy, it’s a corporate policy. Everyone has to buy in.”
– Hend Salem, Manager of Strategic Sourcing – Non Clinical, The Ottawa Hospital

 

4. Checks and balances

Making sure there are processes in place to catch mistakes before they become problems is a crucial part of the procurement compliance process. Your team—and your whole organization—can land in hot water if policy and procedure aren’t followed to the T.

Regulations like Ontario’s Broader Public Sector Procurement Directive give a list of requirements for certain documents, and our panelists have baked these into their own review processes. Many regulations also have requirements for segregation of duties and approval responsibilities that can help you craft your own procedures.

Ask yourself these questions:

• Are there already review processes in place? Are they working as intended?
• Are my documents version-controlled?
• Is my recordkeeping system organized, centralized, and easily accessible?
• Do you do regular internal procurement audits?
• Are there designated people to review procurement documents?
• Do you have a checklist of document requirements to use in your review?
• Do you use any tech that has compliance checkpoints?

 

Compliance and risk management is a team effort

Procurement compliance and risk management doesn’t just fall to the procurement department—it’s everyone’s responsibility. But it is procurement’s duty to make sure policies and procedures are standardized, accessible, and easily understood by internal clients.

Procurement technology is your ally. It helps you centralize and manage documents, create compliance checks, follow custom approval workflows, collaborate with your team and internal stakeholders, and so much more.

Get eProcurement with compliance built-in. Learn how Bonfire can help—book a demo.

So you want to create a vendor diversity program. Where do you start? What pieces should you have in place for success? The most common thing preventing procurement teams from creating these initiatives is not having a starting point.

Recently, we had the pleasure of sitting down with DeNita Lacking-Quinn (Supervisor at City of Dallas Procurement Services) and André McEwing (Supplier Diversity Manager at Tarrant County College) during our TexasTalk event to get their tips on creating an effective vendor diversity program.

Keep reading to find the five key takeaways from this conversation or watch the full recording here.

 

Identify gaps, opportunities, and goals

The foundations of any vendor diversity program come from identifying gaps in procurement accessibility, finding opportunities to help develop disadvantaged business enterprises (DBEs), and setting out which goals you’d like this program to achieve.

During TexasTalk, DeNita mentioned the City of Dallas’s Availability and Disparity Study, which looked at the number of minority and women-owned business enterprises (M/WBEs) who were ready, willing, and able to perform work with the City and how much they were utilized compared to other businesses. The results became the City’s guide when creating their vendor diversity program.

Another way to get more information is to reach out to organizations that represent DBEs in your area such as The Women’s Business Enterprise National Council (WBENC) or see if your state has a framework to guide vendor diversity initiatives. The state of Texas has its Historically Underutilized Business (HUB) program, for example.

 

Gather, store, and use your data

One critical piece of any procurement department is a system to collect vendor diversity data. Rather than trying to secure budget for new tools, André advises working with tools you already have, like your eProcurement system or even Excel.

When it comes to the data you’ll collect, our panelists recommend considering:

• Vendors in your geographical area
• What category they fall into (construction, professional services, etc.)
• What certifications they have (M/WBE, DBE, SBE, etc.)
• What kinds of contracts are they winning
• The award amount for each group of businesses

 

Build relationships

“It’s not an island—you won’t be in it alone,” says DeNita. Creating a program like this isn’t a solo activity. There are four types of relationships our panelists touched on during TexasTalk:

1. Work with certifying organizations and professional associations

Working with certifying organizations and associations that represent DBEs is a mutually-beneficial way to build your program. Since they work with your target businesses daily, they have a lot of information that can help you ensure you have the elements.

2. Facilitate relationships between subcontractors and prime contractors

Both DeNita and André encouraged fostering business relationships between your subs and primes. One way to do this is to invite both groups of vendors to pre-bid meetings and encourage networking. Look at different ways you can help connect your primes to DBE subcontractors.

3. Create champions in your organization

Demonstrating the value of the program to those in the C-suite, on city council, your direct leadership, or whoever will listen can make sure you have a network of support. These allies can help advocate for more resources, be sounding boards for problem-solving, and help drive your program forward.

4. Make friends at other agencies

Talk to your counterparts at other organizations and share knowledge. They may have experience with a similar challenge, possess wisdom to help you optimize your program, or introduce you to key contacts at other organizations.

 

Make your procurement more accessible

Getting bid opportunities in front of your target group of vendors requires a multifaceted strategy, as there are quite a few internal and external barriers for your team to address.

Here are a few touched on by our panelists:

• Many vendors aren’t aware that government contracts are a viable avenue of business for them.
• Vendors don’t understand the procurement process and what’s required of them to start bidding.
• Your bid processes or vendor-facing documents are unnecessarily complex or inaccessible.
• Some vendors either don’t see the value in or aren’t aware of DBE, SBE, and W/MBE certifications.

One way DeNita’s team has addressed a gap is translating vendor guides into multiple languages, opening up the process to more ethnic groups. Both DeNita and André discussed education as a key piece, stressing the importance of working with vendors to understand procurement processes.

 

Set up reporting and review cycles

All the data you collect is going to be valuable for both program optimization and demonstrating results, so setting up regular reporting processes—whether it’s monthly, quarterly, or whatever works for you—helps you track progress. This also provides transparency to leadership, council, the public, and other project stakeholders.

Another way is creating a process review cycle. Leaders at the City of Dallas review each process with their data team annually to cut out fluff, review language, streamline processes, and otherwise make procurement more accessible. This is a great way to continually grow and evolve your program.

Both André and DeNita say you don’t require a complex program right off the bat. Growth of these programs can come in as many phases as you need.

 

See the benefits of vendor diversity initiatives

As you continue to build and grow your program, you’ll start seeing the benefits not just for your community, but internally as well. Our panelists weighed in on the changes they’ve experienced since working on vendor diversity initiatives.

“Bid competition and best-value within that bid competition is the number one benefit the college has seen,” André said. “And innovation would probably have been second.”

Bonfire can help you build vendor diversity into your procurement processes—chat with one our experts to learn how!

Public water utilities around the country are facing the monumental task of updating aging water systems. But trying to fund a persistent list of deferred and priority projects in an era of shrinking local government revenues, staff constraints, and heightened constituent sensitivity to rate increases makes for a challenging environment.

There’s never been a better time to explore creative solutions for stretching budgets further and turning federal infrastructure funding into transformative investments in efficient and sustainable water management. This is a topic municipal finance expert and former mayor of Kansas City, Mark Funkhouser, recently sat down to chat about with seasoned finance and water utility leaders. Funkhouser, who is currently the President of consulting firm Funkhouser & Associates, joined Jennifer Presutti, COO and CFO of the Pittsburgh Water & Sewer Authority (PWSA), George Hawkins, former CEO of District of Columbia Water and Sewer Authority (now the Founder and President of Moonshot Missions), and Anthony Berry, Director of Sales at Bonfire.

Here are 4 a-ha moments from their conversation that should be on the mind of every finance professional.

1. There’s always going to be more work than money to fund the work.

Federal funding initiatives in the U.S. are creating opportunities for teams to address maintenance that has been deferred for many years, as well as kickstart innovation on new projects. The goal shouldn’t be to simply fund projects. There also needs to be a focus on making your utility more efficient, permanently reducing operating costs, and looking through a strategic lens at where to funnel capital dollars.

“During the years I was running [District of Columbia Water and Sewer Authority], our economy was growing but our proposed capital program was three times the size of the money we had to fund it,” says Hawkins. “This is true of every community in every jurisdiction anywhere in the world. How that money is invested becomes the most important question, because you’re never going to have enough. I learned that the hard way at DC Water.”

2. Rate increases are easier to swallow when coated in equity and a strong value prop.

80% of webinar attendees indicated that their organizations have implemented, or are in the process of implementing, rate increases. It’s no wonder equity is top of mind for the panelists. Presutti shared a few ways PWSA addresses the equity question, including working with their finance team to roll out a phased approach to rate increases.

“We’re contemplating when we go back to the PUC for that next rate increase, but always front of mind is the affordability for our customers,” says Presutti. “And, so, working with the PUC, with other entities, and then internally, we have a very robust customer assistance program. We’re always mindful of those folks who are most vulnerable in our communities.”

During his tenure as CEO at DC Water, Hawkins had subsidy strategies in place to protect low-income constituents. He’s also a big proponent of ensuring the citizens absorbing rate increases clearly understand the value proposition of the additional cost, something he personally presented at more than 65 rate hearings during his tenure. It’s an approach that was highly effective in gaining unanimous support for every rate increase he ever brought forward.

“I had two justifications I had to make every time I was presenting a rate increase,” says Hawkins. “First, I had to be able to prove that we were doing more with the money they were already sending us than we did last year. That’s the only way I get to ask you for more money. Second, I had to prove that we’re more efficient…because we’re implementing innovative solutions that are less expensive than our prior practices.”

3. Modifying your approach to procurement can make your business permanently more efficient.

A lot of agencies view procurement as a transactional tool for negotiating with suppliers. But the truth is, making a strategic investment in procurement and sourcing can stretch dollars further and help uncover new supplier partners who ensure you’re getting the most value for the money you spend.

In Pittsburg, they’ve expanded their procurement team from one person to six people and invested in technology that widened their vendor pool, increased supplier diversity, and streamlined their overall procurement process.

“When we had a team of one, it was emails, it was phone calls, it was in person, it was paper, it was disorganized,” says Presutti. “Now we have a system that will take our procurement all the way from solicitation to contracting, (with) one source of truth. And when you’re looking at a capital program with $300 million or $1.4 billion over the next five years, procurement is essential. We need to have transparency. We are a public organization. That is absolutely non-negotiable, and our Bonfire system has helped us achieve that.”

Hawkins also discovered that more streamlined procurement at DC Water was a path to funding projects that would permanently make the business more efficient to operate. “We hired our first ever Chief of Procurement. I sat him two doors away from my office and I was in there every single day because what we were able to do was so dictated by procurement.”

The other element DC Water staff started including in every procurement process was business planning. It was no longer just a question of making a choice based on lowest cost. They implemented a formal review factor around whether any option on the table would be the most efficient over time. This was a game-changer.

“As soon as we implemented that business planning component in procurement things began to change over the enterprise,” says Hawkins. “Procurement started driving innovation because it asked the right questions. In the public sector, most procurement systems don’t do that…but it turns out sometimes you can pay a little more up front and then permanently have a system that’s cheaper, and it’s far better for your ratepayers. I think that was one of the single-most important elements to the success we then saw at DC Water.”

4. The biggest barriers to implementing technology are people and time.

The desire to invest in technology to improve your procurement is one thing, but old perceptions can create barriers to implementing new technology. Innovation has been historically viewed as risky because it’s difficult to know whether a new approach will work. In Hawkins’ view, that’s no longer an issue.

“Many of the innovations we’re talking about, like Bonfire, are well known. These are not brand-new things that we think might not work. There’s a tremendous track record of how it works in a utility, and you can call and talk to someone if you’re interested to know how it works,” says Hawkins. “I think the bigger issue that I’ve seen with utilities is having the personnel time to evaluate, selecting, and implementing new technology, because that is all time that people need to add to their work schedule.”

Berry concurs that the people element is important. In fact, he advocates considering three key elements if you want to create change: process, people, and technology.

• What is the process we’re trying to change?
• How will the technology impact that process?
• Do we have the right people in place, and do they have the bandwidth to actually own the change?

Once you look at these three factors, you may conclude that you’re not ready to embrace the technology (yet). But going through a careful consideration process shows you where the gaps are, so you can create a plan to solve for them to support positive change in the future.

Driving efficient and sustainable water management requires a new mindset

Federal grants are opening doors for water agencies to invest in large contract projects aimed at making significant improvements to existing infrastructure or adding new infrastructure that has been sitting on the back burner due to lack of funds. There’s also an opportunity to make strategic one-time investments that will reduce operating costs for the long run.

“We must look at this through the lens of ‘how can these investments fundamentally alter the balance sheet?’” says Hawkins. “My guess is that a lot of smaller water utilities are going to have to band together and submit applications so they can share costs, implementation, and expertise in putting in some of these new approaches. But the whole notion of transformation is front of mind. That’s absolutely the opportunity before us and we’re excited to see how it’s going to happen.”

Procurement can be a critical driver of sustainable efficiency in how your organization builds, operates, and maintains water infrastructure. There’s never been a better time to look at how you can extract more value from your procurement workflow.

If you’re interested in exploring how modernizing procurement can drive transformation in your organization, reach out to schedule a chat with one of our experts.

Interested in hearing the whole conversation between Mark Funkhouser, Jennifer Presutti, Geroge Hawkins, and Anthony Berry? Access the recording here.

Innovations shaping our future—that was the theme of this year’s NIGP Annual Forum hosted in Boston from August 21st to 24th. Getting together to share knowledge and experiences while tackling new challenges is something so fundamental to public procurement and we love to see the collaboration and passion for the profession at these events.

This year, we’re celebrating the (usually unsung) superheroes in public procurement and, between our booth and the events we hosted, we were able to truly showcase those superpowers at the conference. We hosted our first ever Bonfire Procurement Awards reception to honor our clients who are moving mountains in their organizations. Then in our case study session, we heard how public procurement teams are using Bonfire to drive their organizations forward and positively impact the communities they serve.

At the Bonfire booth, we had the pleasure of speaking with hundreds of attendees from all sides of public procurement. We asked visitors to participate in a poll and tell us what procurement superpower they’d like to unlock in their organization with 120 overall respondents. Digitization won by a landslide and that’s fitting considering procurement digital transformation was a large focus of this year’s conference.

Throughout all these conversations and sitting in on educational sessions, there were three points we heard over and over:

• The benefits (and trials) of procurement digital transformation
• Prioritizing vendor engagement and experience
• The future of work, and how to attract and retain new staff in today’s context

Keep reading for the details of what we learned from NIGP Annual Forum 2022.

Procurement digital transformation

The first common thread we encountered was frustration around digitizing procurement processes. A lot of people vented frustrations over paper-based manual processes, legacy or homegrown systems, and overly-complicated ERP procurement modules.

One session touched a lot on ERPs and asked the audience if they were satisfied with how they were performing. The answer was a resounding ‘no’. We talked with many attendees about challenging the idea that procurement needs to go through an ERP and the barriers to moving towards purpose-built solutions. Many of the tools procurement teams are searching for (contract management, evaluations, vendor engagement, etc.) simply don’t exist in ERPs.

One barrier that came up frequently was buy-in. Aversion to tech in the public sector is nothing new and reasons vary, but it’s becoming more painful to overcome. Challenging the “this is how it’s always been done” mentality can be incredibly frustrating. To frame procurement technology in a different light, in the session titled “What’s Next for Procurement”, Lisa Mehalko, Director of Procurement for Georgia Tech Authority, made a point to say that tech isn’t going to replace a procurement professional’s job. What it will do is free up time so procurement pros can understand the market better than anyone.

Prioritizing vendor engagement and experience

Building strong alliances with vendors has taken a front seat for many organizations and was a strong focus at NIGP this year.

One common topic was streamlining vendor experience and increasing vendor engagement through technology. Many stated a system that makes it easier for vendors to submit bids has increased engagement and vendor satisfaction.

As an added benefit, easier bid submissions removes barriers for small and diverse businesses—which is an emerging priority. The importance of engaging these businesses was summed up in our Innovation for Impact case study session by Glenn O’Steen, Manager, Procurement at Columbia County, Georgia: “Without small businesses, we wouldn’t have an economy. If we neglect this group of businesses, our economy would shut down.”

Watch the full session to gain more insights from Glenn and his co-panelists from diverse areas of public procurement.

Staffing and retention: The Great Realignment

The shift from the ‘Great Resignation’ to the ‘Great Realignment’ was an interesting topic. The term ‘Great Realignment’ comes from examining the needs and values of today’s workforce and adjusting to meet them. We attended a session that explored the ways different generations view their employment—including the disconnect between what older and younger generations value in a job.

Attracting and retaining talent has been a huge challenge for procurement. Many employees are retiring and younger employees are more selective when choosing jobs that fit their core values. Unsurprisingly, this theme ties closely with digital transformation. Younger employees are leaving in search of jobs that use more tech in procurement—citing efficiency frustrations and a more reasonable workload as reasons.

Gain insights for the future of public procurement

Public procurement teams are facing a host of new challenges in a post-pandemic world that’s forcing a lot of change all at once. Stay on top of things by getting insights into procurement technology, vendor engagement, and so much more in the 2022 State of Public Sourcing report. Get your copy here.

One of the most challenging parts of putting together an RFP is getting stakeholders involved in the build process without creating chaos. If you’ve ever had different document versions from multiple editors get stored in different locations, or you’ve experienced painful approval processes that take place through endless email chains, you know how frustrating and time-consuming that chaos can be.

Eliminating that chaos reduces aggravation and waste, but also leads to happier stakeholders, more engaged vendors, and better solicitations that lead to better outcomes. With demands on public sector procurement teams increasing all the time, the need for effective RFP collaboration will continue to increase, too.

In this blog post, we’ll take a look at why RFP collaborations tends to be so chaotic, and how Bonfire helps transform the chaos into productive teamwork.

The sources of RFP collaboration headaches

The process of creating and posting solicitations is intrinsically cooperative; requesters, procurement professionals, evaluators, and approvers each have their own concerns, tools, and processes. Shoving them all together creates challenges that you may be all-too-familiar with, including:

• Tracking changes and comments: Keeping track of document edits becomes difficult when people prefer different editing tools and approaches.
• Managing document approvals: Approvals become cumbersome and slow the procurement process down because approvers have other jobs; they become a procurement bottleneck.
• Compliance and version control: Good change histories are hard to maintain, contributors are working on different versions of the same document, and viewing or rolling back to earlier versions is hard or impossible. This isn’t just inconvenient; it’s a serious compliance risk.
• Time management: Inefficient communication and unnecessary extra cycles make it hard to scale procurement operations up to the increasing demands stakeholders make on procurement teams.

These are the collaboration headaches we hear about most often from the public sector organizations we talk to. As part of our commitment to make public procurement teams as effective as possible, we decided to develop a solution.

Solving RFP Collaboration

In looking for a solution, we quickly found our way to a list of capabilities we knew procurement professionals needed – capabilities that, together, would make RFP collaboration easy by helping procurement professionals to:

• Maintain one source of the truth by keeping RFP documents in one place; no more fumbling through cloud and network drives.
• See who changed what, and when, and keep an auditable record of edits.
• Control access to documents from one place, granting viewing or editing privileges as needed.
• Do more with templates, including better template searching and a way to cascade template changes down to individual documents.
• Edit documents without leaving Bonfire.

 

The future of RFP collaboration

The need for collaborative tools in procurement isn’t going away, which is why we’re not stopping at these capabilities. Streamlining collaboration is one of the biggest opportunities for improvement that exists in the solicitation building process, and Bonfire is committed to leading the way, so stay tuned as we continue to develop and announce new Bonfire Solicitation Builder features and other collaborative tools in the future.

Learn more about Bonfire Solicitation Builder

We couldn’t be more excited about Bonfire Solicitation Builder, and we can’t wait to hear what you think! Learn more by visiting the Bonfire Solicitation Builder web page or get in touch with us now to book a demo!

Caribbean procurement departments face a lot of challenges that other countries typically do not. Whether it’s moving on from a complex custom eProcurement solution or stewarding public trust, there are many factors that Caribbean procurement leaders need to navigate to see success.

Recently, we set up a panel discussion with Craig Milley, Principal Consultant at Wayfinder Consulting Inc., and Joe Fagan, an eProcurement consultant with many donor banks, who both work directly with Caribbean procurement departments. The aim of this event was to help Caribbean government agencies see sustainable success in eProcurement transformation.

Continue reading to see the summary of this discussion or watch the full recording of this webinar here.

Defining eProcurement and where to start

Getting started with eProcurement can be daunting if one doesn’t understand the reality of the tool. eProcurement is just that, a tool, not a magical cure-all to all of your procurement department’s challenges.

The panelists discussed different challenges that should be identified before moving forward in your eProcurement transformation such as financial reasons, ease of access for vendors, or transparency to foster trust from vendors and the public.

eProcurement is a tool that supports and facilitates the exchange of information between all involved parties and can help you address those identified challenges. That being said, the success of eProcurement greatly depends on your policies and processes and how they evolve to be able to take advantage of technology.

Best-of-breed, what does it mean?

Taking on a large, complicated tool like an ERP with hopes that it will solve all your procurement woes will most likely do more harm than good. Although ERPs have their advantages in certain use cases, they simply aren’t built for the rigor and regulations of public sector sourcing and contracting. One approach is to find software that does one thing really well to address the specific problem you’re having and stitching it together with other systems that address other specific problems. This is the “best-of-breed” approach.

In a previous article we phrased it as “a ‘swiss-army knife approach’ to buying software.”

SaaS and off-the-shelf solutions

Deciding on which solution to go with, it comes down to what tools and functionality you need and the capacity of your team. Overall, software-as-a-service (SaaS) and off-the-shelf solutions have more benefits than custom-built tools that take a lot of time and resources to build and sustain (and that’s not even counting the time it takes to train and support users). Many governments—not just those in the Caribbean—don’t have the luxury of those resources.

Here are a few benefits of SaaS and off-the-shelf solutions our experts outlined:

• Software vendor handles security and other IT infrastructure
• Usually includes a vendor database
• Fast implementation and onboarding
• Less vulnerable to cyber attacks
• Sustainable and scalable
• Support and training handled by the vendor
• Can choose vendor with most user-friendly tool

Simplicity is key! A common issue with custom or in-house-built solutions is they are very complex. One question that Craig Milley asks when determining the user-friendliness and ease-of-use of a software is the Amazon test. Is using the software more difficult than shopping on Amazon? If yes, then that may not be the software best-suited to your team or solving your particular problem. Choosing a software that is easy to use and intuitive avoids putting the burden of learning it on the end user of the system while addressing your issue.

Prioritization and change management

The key to any large project within any organization is buy-in. The panelists discussed creating supportive relationships with C-level executives, management, and those you will be working closely with. Educate them on how this change will make their jobs easier and benefit the organization as a whole. Finding those champions that believe in your cause will help you bring others into the fold for a smoother transition and adoption.

At all costs, avoid big changes all at once. Don’t make transforming your procurement into a daunting process. Instead try for slow, manageable changes with constant communication and support for stakeholders.

The successful eProcurement transformation recipe

For the last portion of the discussion, we asked the panelists what their “recipe for success” in eProcurement transformation looks like.

Here are some actionable steps they recommended:

• Define the problem you want to solve (such as increasing efficiency, fostering collaboration, or better managing your vendors) and establish manageable scope. Remember that technology alone won’t solve a broken process; take a look at how your current process is road-blocking your procurement goals and research solutions that will transform those processes.
• Find the right software solution that has been purpose-built to solve your specified challenges. Be sure to select a provider with a relatively fast implementation time so that you can start to bring your processes online while expanding the scope of what you need. Start with small, manageable wins.
• Work with the provider to ensure stakeholder buy-in, considering items that will make life easier for your evaluators and vendors, such as support hours, implementation services, and easy-to-use tools.
• Get started!

Start your eProcurement journey with Bonfire

There’s no “one size fits all” way to successfully transform eProcurement in your organization but this event was intended to give Caribbean nations a solid foundation to get started on. It doesn’t need to be an overnight change and it doesn’t need to be a scary process.

Bonfire can help you get started at the pace that’s right for your organization.

Book a demo with one of our experts to see how Bonfire can help you achieve your eProcurement dreams.

Whether the motivation is new legislation or funding requirements, increasing competition in your RFP responses, or supporting your community — there’s no wrong reason for public sector procurement teams to foster more diversity in their vendor pool.

So how do you create vendor diversity initiatives in your organization? Many Bonfire clients have asked this question, so on May 12th we asked Sheena Fain from the City of Akron and Robert Tatum from the Cayman Islands Government to join us in a discussion of the topic. In this webinar, they tell us how they created successful vendor engagement and support strategies and built these processes into their organizations.

Here are the highlights of this discussion or you can watch the webinar here.

But first, what is vendor diversity?

Vendor diversity in public procurement encapsulates the practice of supporting small, minority-owned, or historically under-utilized businesses in gaining access to government contracts. These businesses would include entrepreneurs or businesses with fewer than 50 employees (definition varies per jurisdiction) as well as businesses owned by women or people of color.

Some phrases or acronyms you may have seen around this topic include: disadvantaged business enterprise (DBE); diversity, equity, and inclusion (DEI); or supplier diversity.

Questions and key takeaways

At what point did diverse suppliers or small suppliers become a priority?

For many public agencies, creating a dedicated effort to engage diverse suppliers is something new and driven by legislation or funding requirements such as some components of the American Rescue Plan Act (ARPA).

While legislation was one of the reasons stated by our experts, it’s clear that those requirements were more of a tool to secure more buy-in from internal stakeholders after working on similar initiatives for a while. They also stated that the catalyst came from research and listening to their communities and seeing the need to support those vendors. Legislation was the centralizing factor to those efforts.

How did you approach designing your diversity initiatives and evaluating your strategy?

We discussed evaluating the current state of processes, how they affect DBEs, what’s working, and what’s not working. It’s key to identify what’s getting in the way of success and how to capitalize on opportunities.

To do this, talk to the target businesses, analyze the information received, understand their needs, and identify barriers.

Some advice the panelists had for organizations still in the planning stages of their supplier diversity and small business support programs include:

• Keep the end goal in mind at all times
• Find ways to collaborate with small business associations, community groups, and other departments in your organization
• Educate and engage internal stakeholders about the importance and value of small and diverse vendor engagement
• Work with business owners’ time constraints by offering engagement in different formats and timeslots
• Put in as much effort as you can so your target businesses don’t have to

How did you structure your supplier engagement strategy?

Leading off the previous responses, the discussion centered around gathering feedback, networking, building partnerships, and meeting these businesses where they are as a few of the ways to structure a supplier engagement strategy. As Sheena put it, “know your ecosystem”.

We talked about finding out how the target business owners spend their time and meeting them there so they don’t have to go out of their way to engage with you. A great example that Robert mentioned is that his team works with the office that handles business licenses to piggyback on their communications and other ways to engage.

Part of the feedback the panelists recommended gathering was how these target businesses want to be engaged with such as:

• Format (phone interviews, questionnaires, in-person group discussions)
• Time (before work, after work, weekends)
• Content and communications (educational sessions, email newsletters)

Sheena also discussed how she creates and leverages public-private partnerships. This means engaging with local professional service providers to create educational materials and offer free or subsidized services. Most of the target businesses don’t have the funds to hire a lawyer or an accountant but through these partnerships they would have access to services that can remove barriers for them to compete for government contracts. Part of this is to draw business owners in and offer educational opportunities while incentivizing their engagement.

How did you rework RFP and RFQ requirements to include DBEs?

One takeaway from the responses to this question is to build relationships with internal stakeholders to create change in RFP and RFQ processes. Since government agencies tend to have long tenure, it’s easy for staff to have a “this is how we’ve always done it” mentality and resist change. Demonstrating why changes to these processes will benefit them personally as well as the organization as a whole will go a long way in securing buy-in.

Another key point is to set these businesses up for success in the RFP and RFQ processes. Your organization has access to resources that these businesses don’t, such as a legal team. You can use these resources to take some of the strain off and encourage vendors to submit responses. For example, if one of your RFP requirements for the vendor is to submit a contract, have your legal team draft a standard contract for them to use.

Some advice was to try new things with these processes. Ask for feedback from both internal and external stakeholders and take that feedback with grace while implementing where possible.

What diversity metrics do you track?

Measuring your program success is key to future improvement, so as part of planning you should define success criteria and what metrics to track. Reevaluating the way success is measured is also a great way to grow and scale your program as you go.

Here are some of the metrics our experts track:

• Award amount for minority contractors
• How many DBEs they’re currently working with
• Bonfire vendor sign-ins
• Outreach event sign-ups

Also mentioned was the opportunity to use a customer relationship management (CRM) system to track contacts and communications with them as well as follow a timeline from the first touchpoint to winning a contract.

Looking back on creating this program, what would you have done differently?

Creating such a large shift in processes and priorities with no real framework to work from can mean a lot of trial and error but our panelists agreed: progress is progress.

A lot of the discussion circled back to educating and empowering colleagues. Resistance to change isn’t necessarily intentional; it could be that they’re unaware of new ways of doing things or have misconceptions about what’s allowed and what’s encouraged.

The panelists also encourage those trying to create similar change to be actively involved in the improvement and not to just do things on autopilot. Waiting for perfection is counterproductive.

What would you like attendees to take away from this?

Sheena sums it up: just start. There is no right or wrong way to start supporting DBEs so start having conversations with your internal teams and the businesses you aim to support. Small businesses are the backbone of America and supporting them is a smart business strategy.

Robert says to meet the businesses where they’re at and focus on what you can control. Small businesses have many restrictions so you can choose to change your procurement processes to meet their needs rather than trying to shape businesses to meet yours.

Support vendor diversity at your agency with Bonfire

Public procurement teams are in a unique position to support the economic growth and social wellbeing of your local communities. Getting started on these initiatives can be daunting, but arming yourself with as much information as possible is a great first step.

Read about how you can support vendor diversity in your organization with Bonfire.

All across the US, governments at the state, tribal, and local levels are wading through the enormous task of managing a combined $1.9 trillion in federal funding.

The money, approved in March 2021 through the American Rescue Plan Act (ARPA), is helping communities at all levels rebound from the detrimental impacts of Covid-19. But, as it turns out, managing and allocating the funds is no easy task.

To help you navigate these opportunities and challenges, we reached out to two expert panelists: Joel Neavell, Director of Procurement for the Louisville Metro Government, and Ken Hillebrand, Deputy Director of the Louisville Accelerator Team. They joined our webinar, Everything About Accessing ARPA, to share firsthand experiences and insights gained over their first year managing Louisville’s $388 million in ARPA funding.

Keep reading for all the highlights from the webinar, including how to assemble the right team, use the money to support strategic goals, and meet compliance and reporting requirements.

Louisville’s approach to managing ARPA funds

After ARPA was approved by the federal government in 2021, the Louisville mayor assembled the Louisville Accelerator Team. Ken, who is deputy director on the team, said it was critical to hire the right personnel to manage the multi-year initiative. “We definitely had to add headcount to manage these funds,” said Ken. “Our grants person has said this is the most complex compliance and reporting grant that she’s ever seen from the federal government.”

The Accelerator Team manages ARPA funds in collaboration with Joel’s procurement team, the city’s federal grant specialists, and others in the Office of Management and Budget. The team’s primary function is to help departments and applicants with ARPA compliance and reporting.

Understanding the funding

There are some important things agencies need to know before they start planning how to use ARPA funding. Ken and Joel shared these tips:

Timeline

The US Treasury has placed a timeline on the use of ARPA funding:

• all funding must be “obligated” by December 31, 2024
• all funds and programming must be completed by December 31, 2026
• all reporting must be completed by March 2027

“It’s a large window,” Ken said, “but if we’re looking at large projects like affordable housing, those take several years and we need to get them started right away.”

Funding amount

ARPA is designed to be one-time funding and the amount that each jurisdiction is eligible for is determined by the federal government. Louisville received one allocation for its city entity and one for its county entity, totaling $388 million. The government is also eligible for ARPA money funneled through the state of Kentucky, but those projects are managed at the state level.

Eligible uses

ARPA funding is intended to drive pandemic recovery efforts, so Ken said projects must demonstrate some nexus to Covid-19. One exception is projects related to water, sewage, and broadband infrastructure. In Louisville, Council decided on seven priorities they wanted to address based on data around community need.

Reporting

Reporting and compliance requirements depend on the size of the locality – whether the population is above or below 250,000. For Louisville, there are three types of reports required: a quarterly report to the US Treasury Department, an annual report, called the Revenue Recovery Project Plan Report, and a monthly report to Metro Council.

The strategic side of ARPA

While $388 million seems like a lot of money, it barely scratches the surface of everything Louisville’s internal departments and community groups want to achieve. So how did they decide which projects to pursue? 

Prioritizing projects

Based on their seven priority areas, Council created working groups responsible for selecting high-impact projects. The working groups engaged the community through surveys and public meetings to find out how residents wanted to spend the money. For the first round of funding, the city focused on emergency response efforts to address the pandemic. In the second round, they began looking at longer-term projects.

Focusing on impact

“As we were looking at the projects, we looked at ‘okay what can we do that’s going to make an impact in our community over a period of time?’ So that, when we look back 5, 10, 15 years from now, we can say, ‘Hey, we made a good investment in our community,’” said Ken.

While deciding how to use the funding can feel overwhelming, Joel said it’s a huge opportunity to think innovatively about how to solve ongoing and emerging challenges. “It enables us to try new things. Even if we try it and we fail, we’re going beyond what we had been able to do without these resources.”

Preparing for the funding

Understanding the requirements for ARPA funding is a big learning curve for everyone involved: procurement, internal clients, suppliers, and nonprofits applying for grants.

Supporting stakeholders

On the procurement side, Louisville’s vendor community is used to working with the government on municipal projects. But they’re not as experienced with federal funding, which has certain federal procurement requirements.

“That really has been a big learning curve for all of us, on the vendor side and even on our staff side — making sure we’re checking all the boxes, that we aren’t doing something that would result in us having to return the money back to the federal government,” said Joel.

It’s the same for internal clients who “get approved for projects but then don’t understand requirements,” said Joel. “There is a need on [procurement’s] side to upskill our own staff on how to manage expectations.”

Working with nonprofits

Nonprofits also need to get up to speed on how to apply for grants available through ARPA. For each grant opportunity, Louisville releases a request for applications (RFA) on Bonfire. Using Bonfire makes the process easier for both applicants and the project team, ensuring easy access to documents, centralized collaboration, and a transparent scoring system.

Ken’s team is looking to take it one step further and provide a more in-depth two- to three-hour session to help new nonprofits learn the ropes. “Some of these groups aren’t even grassroots, they’re just seedlings… We want to go the extra step to help reduce complexities. Our goal is that they’re all successful – in applying and getting the award.”

Take advantage of ARPA funding

While the process of using ARPA funding may feel daunting, Ken and Joel say it’s an opportunity they couldn’t pass up to serve their community better.

“Regardless of the lift, it’s a necessary catalyst for recovery,” said Joel. “We might not see these projects have immediate results. But these are investments that we’re going to see the benefits for hopefully years from now. You either see it as another burden on the back office of government or you say, ‘This could transform our city or our town and we have the opportunity to do that.’”

Want to learn more about how to effectively spend and manage ARPA funding? Schedule a demo to see how Bonfire can help.