8th September 2016
Investing in a Procurement Ecosystem – the Holy Grail to achieving more with less?
Procuring new services and suppliers is expensive, for both commissioners and providers. With the sharp reduction in public funding and increasing pressure on resources, it’s easy to skip through the procurement process to get from one end to the other as quickly as possible.
We work together in a functional market place and our relationships continue to be maintained despite our financial pressures, cultural and operational differences. We refer to operating within a ‘procurement ecosystem’ – in theory, a complex, dynamic marketplace that creates value for money collaborations; but is the reality that we’re just doing the same things over and over, hoping that it will somehow be cheaper or better than before?
So, what would happen if together, we invested more time and expertise upfront to create an actual procurement ecosystem? Could working together more collaboratively and effectively before and during the procurement enable us to extract greater energy, experiences, and innovations, delivering enhanced satisfaction and value for money? And were this to become the norm in procuring services, would it fuel a flourishing market where the buyer is happy and the supplier is happy too, creating the ultimate partnerships, where the focus is always on the desired outcomes?
At ENGIE, we have experienced many approaches to procurement – from the ‘skip right through’, to a more collaborative ‘ecosystem’ approach. All technically work, however, there is a notable difference in the ability to be creative, overcome challenges, look for opportunities, drive innovation and deliver satisfaction when the procurement is designed together. So what will it take to create your procurement ecosystem? A partner with shared values and mutual respect, the experience to deliver, someone who keeps their promises, is flexible about change, and most importantly prioritises open and honest communication from the outset.
We are fortunate enough to work in partnership with forward-thinking local authorities, wanting to flourish within a dynamic procurement ecosystem and make it work for them. Together, we have taken the steps needed to shape the market place and engage to extract energy and ideas for growth and innovation within their boroughs.
One of these is the Royal Borough of Kingston-upon-Thames. ENGIE engaged and shared knowledge and expertise during their soft market test phase, to assist with the design and shape of their procurement. Our relationship continued through an effective competitive open dialogue process, and after winning the contract we are now there to assist them with the commercialisation of their estate, driving down costs and generating additional income.
ENGIE’s award-winning partnership with North East Lincolnshire Council is an excellent example of how a partnership can grow. Now halfway through our 12-year relationship, the culture of our partnership continues to evolve and reward both parties. The Council’s procurement ecosystem went beyond traditional Facilities Management and smart maintenance services, to create a partnership that thrives on innovation and is subsequently delivering a comprehensive urban and economic regeneration programme. ENGIE is proud that to date the partnership has brought £395m of inward investment and created nearly 3000 jobs in the region, with further plans for the next 6 years to extract the best from the market.
The voluntary sector must also not be overlooked as despite their lack of available funds they provide complementary services which add value to the dynamics of public-private partnerships. The London Borough of Lambeth has worked with ENGIE to ensure through its procurement ecosystem that the third sector continues to provide services and support local people. ENGIE assists with financial and practical support to ensure these vital activities can continue year on year throughout the lifetime of the contract.
Looking forward, the pressure on resources is set to stay and the benefits of collaboration must not be underestimated. We must work together more effectively to ensure we deliver better value for Local Authorities and unlock the potential from our communities. We are jointly responsible for creating a dynamic environment where we don’t just come to buy and sell, but to make the very best of what the market can offer, and through greater communication achieve more with less.
If we are to create the cities and communities of tomorrow we need to talk, and best of all it’s free.
By Robert Cunliffe, Sales and Marketing Director – Cities & Communities, ENGIE