Achieving successful procurement outcomes starts in the planning stages, by understanding the market, planning ahead and establishing clear governance and decision making processes from the outset. From engaging stakeholders early and managing incumbency risks, to maintaining strong audit trails, encouraging competition and investing in fit for purpose templates, agencies can significantly improve value for money while reducing procurement risk. 

The key lessons below highlight practical steps procurement teams can take to strengthen procurement planning, improve market engagement and deliver competitive, transparent and defensible procurement processes.

1. Understand your market

Avoid market failure by maturely engaging with risk and doing the work upfront to ensure the contract or delivery model is an attractive proposition for tenderers, to update your understanding of market capability and what value for money looks like in the market today. Consider what ‘market research’ options are available to you (e.g. discussion paper, exposure draft of ATM, request for information, information briefings, consulting with other departments) and remember to treat all potential respondents fairly and equitably (for example, generate interest by publishing a planned procurement notice on AusTender or updating your APP).

2. Keep good records 

Keep a record of decisions made on procurement methodology and approach, how the estimated value was arrived at and why the recommended outcome is demonstrably value for money. This can really help as procurement progresses.

Workforce attrition and/or pressure to reduce staffing levels and use of external contractors can lead to a loss of corporate knowledge. Similarly, delegates can change and inherit responsibility for procurements that their predecessors have set in motion. Strong paper trails showing what decisions have been made and why helps manage the risk that a new delegate will want to change course mid-procurement. Brief up regularly and implement induction and handover processes internally to help further manage this risk.

3. Anticipate change

If possible, build in as much flexibility as possible into your ATM documentation. Think about likely future scope and consider seeking pricing and approach information on this as part of your tender. However, sometimes, priorities change. If you need to make a change (or cancel the whole process) once you’ve started your procurement, seek legal and probity advice quickly before tenderers incur unnecessary bid costs. 

4. Establish an audit trail of how you’ve managed any incumbency risks

Be transparent about your incumbent provider, particularly if they’re likely to retender. Implement practical ‘separation’ measures. Seek advice on how you will ‘level the playing field’ so tenderers have confidence you’re committed to a competitive process. Ensure your procurement requirements do not further embed your incumbent. 

5. Set realistic timeframes when planning ahead

Establish and know what the governance framework around a procurement will be, including which technical experts, users, executives, advisers will be at hand when you need guidance or a decision urgently. Understand how advisers will intended to be used and how they can be helpful (i.e. know their scope and swim lane but equally not introduced too late for them to make a difference).

6. Invest in good templates

A good template is at least a solid starting point for most projects. Avoid unnecessary fees and delays having external advisers provide the same advice on how they could be improved. Instead, empower teams to make iterative updates to capture improvements and make sure client areas are using the correct template. This increases the likelihood of compliance with the latest CPRs and procurement connected policy updates. 

7. Know your limits

Seek external advice for significantly complex, high risk ATMs requiring bespoke contracts, or where a template approach won’t cut it. In particular, make sure of specialist technical advice when settling your requirements and evaluating submissions. (However, beware of conflict of interest risks!)

8. Engage your stakeholders early and bring them along the journey

Find an appropriate forum through which to engage your stakeholders so they are a part of the decisions made, but in a way that is productive and not disruptive to your processes.  

9. Panels are useful but have limitations too

While panels are attractive in that they offer a more efficient procurement methodology than an open approach to market, check that what you’re procuring is ‘in scope’ and was actually contemplated when the panel was established. Consult with the panel manager and limit the amount of surgery you perform on template RFQs. 

10. Encourage competition

Avoid including unnecessary essential requirements, minimum content and format requirements and conditions for participation. Also scrutinise any limited tender conditions or exemptions being relied upon and document reasons for limited tender as required by CPRs para 10.5.  Work towards an attractive number of tenderers, particularly for complex or document-heavy requests for tender as this will encourage market investment in your procurement.