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Innovation in Procurement: A Public Body Perspective

Innovation in procurement is a multifaceted concept, especially within the risk-averse and budget-stretched environment of the public sector. Some advocate for trials, R&D, market-making, and using competitive dialogue or flexible procedures to ensure full market engagement as part of the process.

Empowering SMEs

Another approach focuses on creating an environment where SMEs have the best chance of winning bids. While this might not be traditional innovation, it is transformative for many SMEs, placing empowerment at its core. The following strategies can significantly enhance tendering opportunities for SMEs without needing public body endorsement:

Value for Money and Cost Savings: Public bodies prioritise value for money and cost savings, making it crucial to provide metrics that demonstrate this. Improved efficiency, achieved through innovative methods, can lead to reduced resources or faster outcomes, both of which cut costs. SMEs also can often offer competitive rates due to lower overheads compared to larger firms.

Key Considerations for Public Bodies:

  • Value for Money
  • Improved Efficiency
  • Sustainability
  • Carbon Reduction
  • Social Value

Efficiency and Evidence

Improved efficiency often requires doing things differently. With robust evidence and data, the perception of high risk can be mitigated. Capturing comprehensive data to support your business case, which can often be completed through desk-based research, is essential.

Sustainability and Carbon Reduction

Sustainability encompasses more than just carbon reduction; it includes local benefits, sustainable materials, and ethical practices. Aligning these factors with your business values and policies is crucial. Carbon reduction, a key goal for achieving Net Zero by 2050 in the UK (2045 in Scotland), is a significant focus. Adhering to PPN 06/21’s ‘Carbon Reduction Plan’ is often a prerequisite for many government frameworks, positioning you favourably against competitors.

Social Value and the New Procurement Act

The new Procurement Act emphasises ‘Most Advantageous Tender’ and the importance of ‘maximising public benefit.’ Social value, as outlined in the Social Value Model (GCF) and PPN 06/20, covers job creation, community benefits, well-being, and innovative efficiencies. Preparing to demonstrate your business’s support for social value initiatives is essential in the bidding process.

Opening the Door

  • Joining Frameworks: Being part of the right frameworks is crucial. It simplifies the buying process and provides market confidence. Ensure the frameworks you join align with your products or services.
  • Stakeholder Mapping: Understanding your target audience through stakeholder mapping helps identify key decision-makers and organisational structures, enabling strategic engagement.
  • Marketing and Events: Effective marketing ensures your product is known. Participating in supplier days and industry events promotes your products and services, positioning you favourably when procurements are announced.

By embracing these strategies, SMEs can enhance their opportunities and contribute significantly to driving innovation in public sector.

By Hannah Lloyd
IPEC – Innovation Procurement Empowerment Centre

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