Procurement and the ICT Industry
Public procurement plays two principal roles that relate to the McClelland Report and its implementation across the public sector. Firstly on the supply side, where the act of public procurement can play a vital role in delivering value for money through a balance of cost, quality and sustainability, building on the collaborative activity already underway as part of the Public Procurement Reform Programme. Secondly on the demand side, where it can encourage businesses to enhance their productivity and competitiveness through the deployment of digital techniques in the public procurement process.
Since 2008, and in response to the 2006 John McClelland's Review of Public Procurement, Scottish Government-led procurement has made a notable contribution to the delivery of ICT and digital objectives across the Scottish public sector. Key projects have included:
- IT Hardware Desktop & Laptop Agreement - as well as delivering best of breed specifications and environmental performance, savings in excess of £32m have been achieved since 2008;
- National Fixed Telephony Framework - offers significant Value for Money benefits compared to other UK frameworks commonly used across the public sector;
- IT Managed Services - scope of the new national framework agreements include the delivery of hardware, application, website and data hosting; application and website support; desktop and sever support; and professional services such as IT consultancy (advice and strategy); IT project and programme management; IT development and support services; and, data network management services.
- Web Applications Framework - this agreement is accessible by central government organisations and has the potential to support the development of ICT infrastructure;
- eCommerce Shared Services - this national e-commerce solution is regarded as one of the most comprehensive and successful public sector eGovernment initiatives in the world. The procurement process for the next iteration of the service is currently underway.
However, it is recognised that there is significant scope for enhanced collaboration and improved efficiency across the public sector as a whole, and the McClelland Report provides the ideal framework to drive improvement in this area.
Together, Scotland's eCommerce Shared Services are regarded as amongst the most successful eGovernment initiatives in Europe. The shared services provide a platform for public sector organisations to share content, advertise contracts, run tenders and carry out purchasing transactions electronically with suppliers. It also provides a public sector the opportunity to improve its procurement functions and processes through the use of technology.
Until 2011, the approach of the eCommerce Shared Services followed two strategic paths:
- eProcurement Scotland (e PS) as an eProcurement platform using common purchase-to-pay (P2P) and sourcing applications; and
- Technology for Procurement Reform as a common management information hub alongside Public Contracts Scotland as an advertising portal.
This approach has had the advantage of creating a critical mass of public sector and supplier users across a wide range of organisations and businesses.
Since 2007, the e PS service has seen:
- The number of public sector organisations participating in the service increase from 38 to 111.
- A 52% increase in the number of registered suppliers, a 35% increase in the number of purchase orders raised through the P2P system and a 31% increase in the value of spend through P2P (£2.9bn during FY10/11).
- Savings of approximately £10m through the use of eAuctions and approximately £480,000 through the use of eTendering. It has also supported over 9,000 eTendering cases over the last financial year.
Since 2007, Technology for Procurement Reform has seen:
- Over 56,000 suppliers and 350 public bodies registering on the Public Contracts Scotland ( PCS) portal, allowing registered suppliers to receive free e-mail alerts to contract opportunities.
- Development of the Scottish Procurement Information Hub, with circa £9bn per annum of public spend is consistently classified, underpinning the collaborative procurement agenda.
- The development of a national contracts register populated via an interface with Public Contract Scotland.
eCommerce Shared Services
The 'Review of ICT Infrastructure in the Public Sector' (McClelland) states that:
"At all levels outsourcing and industry partnerships should be evaluated to take advantage of industry experience, rely on their capital investments and optimise cost. The contract for a Service Manager for the eCommerce Shared Service has been awarded to Amor Business Technology Solutions Limited, Scotland's largest independent IT company. The original proposition was based on the creation of a public sector infrastructure asset within the Saughton House Data Centre. The procurement exercise (which was highly competitive and included large multi-national companies) was undertaken using the Competitive Dialogue process which enabled innovative thinking to be encouraged with all bidders. The winning bid demonstrates technical and business relationship innovations that would not have been achievable under a restricted procurement procedure. During the dialogue process, technical requirements were revised to take account of industry experience to ensure that value for money was achieved and costs were optimised.
The outcome of this contract combines private sector infrastructure investment within a public sector Data Centre. It also realises technical innovations from Scottish companies working in partnership resulting in a lower cost solution providing an enhanced service.
The eCommerce Shared Service builds upon Scotland's successes in the deployment and management of eProcurement technologies across the Scottish public sector and its supply base and also showcases Scotland's supplier capability to host and manage what is regarded as one of the leading government eCommerce services. The eCommerce Shared Service brings together all the steps involved in doing business with the public sector in Scotland. It is a collaborative electronic environment, that promotes both improved capability across public procurement in Scotland and improved use of eCommerce across Scotland's suppliers."
Planned Delivery to 2016
Planned procurement strategies in the ICT area led by the Scottish Government are being aligned with the McClelland recommendations. Specific examples of work in hand include:
- Web Conferencing - in August 2011, a tender was advertised for the provision of web conferencing services across the Scottish public sector, which will deliver significant budgetary and environmental benefits in the coming years;
- Public Service Network for Scotland - linked to both the McClelland report and Digital Strategy, we are working to determine the optimum way of achieving a single PSN for the public sector in Scotland. The PSN will create a "network of networks" for the Public Sector from the existing commercial networks and will develop a market place providing opportunities for industry, and savings for the public sector.
- Mobile Telephony Services - we are about to embark on the first collaborative tender exercise for mobile services, harnessing the purchasing power of participating public bodies to achieve best value for money.
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