Journal of Public Procurement

Publisher:: Emerald Group Publishing Limited
Publication date:: 2021-02-01

ISBN:: 1535-0118

Issue Number

Latest documents

Governance of projects in public procurement of innovation a multi-level perspective
Purpose: Governance of projects is a dynamic process that involves the interaction of agents, opportunities, rules, instruments and legitimacy. The authors conducted a case study of the governance of exploratory projects in public procurement of innovation in a local government. The authors consider both contextual aspects that impose requirements on the procurement process and procedural aspects of how the different actors interact with each other. In particular, the purpose of this study is to investigate how actors make sense of the projects and how governance evolves over their lifetime. Design/methodology/approach: To engage in an open-system investigation of exploratory public procurement of innovation (PPI) projects, the authors adopted a case study approach in which they collected a variety of data including publicly available documentary evidence, interviews with project participants and project evaluation reports. The authors used transcripts of 17 interviews with project participants conducted independently to gain an initial understanding of the case. They conducted additional semi-structured interviews with projects’ participants (ten interviews in total) and used theory-driven analysis (Pawson and Tilley, 1997) based on Borrás and Edler’s (2014) model of governance. Findings: The authors identified four stages – problem identification, partner selection, partnership development and evaluation and commercialization – these projects. The case demonstrates how governance changes in each stage and at the three levels of policy, network and projects. Each level has its own governance pillar. The results suggest that a multi-level perspective (MLP) can be a fruitful framework to study governance of projects in these contexts. Research limitations/implications: The authors note that the number of participants in the network of this case is not very large. Other organizations that aim to adopt PPI may need to pay attention to the complementarity and the number of partners in the network. In this case, organizations were motivated to collaborate as each had its own objectives which were distinct but complementary. Practical implications: Co-creation of value is currently a topic of interest for public policy reform across the globe. The case indicates that procurement for innovation requires a degree of coordinated change across governmental departments, such as planning, legal and procurement to implement the policy and related support systems. Furthermore, the authors observed that a portfolio approach to inter-organizational collaboration with different partners was effective. Each partner has its own objective, but they complement one another. A portfolio of different, though complementary, inter-organizational arrangements enables various complementary instruments and various logics to be used. Social implications: The public sector is an important actor in driving innovation in products and services that fulfill societal needs. This is explored in public procurement of innovation. In this process, several partners from private and public sectors are involved. This partnership is mainly used to co-create the value and encourage innovation to benefit the citizens. However, to serve this goal, the case indicates that procurement for innovation requires a degree of coordinated change across governmental departments, such as planning, legal and procurement to implement the policy and related support systems. For this phenomenon MLP should be used as an inclusive framework to study socio-technical change. Originality/value: The analysis of the case presented in this study demonstrates that even in the case of temporary public procurement of innovation projects, governance is layered. The three pillars of governance not only interact at each layer but also communicate across layers. Even though the interaction of the three pillars of governance is well established in the literature on socio-technical change, the interaction across levels in the context of temporary projects is novel. The authors contribute to the literature on governance of such projects by highlighting the stratification of governance.
Competitive dialogue: an economic and legal assessment
Purpose: The purpose of this paper is to discuss the economic and legal rationale for the use of the competitive dialogue in complex procurement. The authors use the data set of public contracts awarded by European Union (EU) member states between 2010 and 2017 to analyse its usage patterns. In particular, the authors identify the types of contracting authorities that mainly use the procedure, the sectors and contract characteristics and the role of institutional factors related to the country’s perceived corruption and level of innovativeness. Design/methodology/approach: The authors discuss economic and legal issues in the use of the competitive dialogue. The authors use a data set of public contracts awarded by EU member states, published on the EU’s public procurement portal Tenders Electronic Daily (TED) to analyse usage patterns and explore the types of contracting authorities that use the procedure, the sectors and type of tenders. The data covers a sample of 1.242.090 observations, which relates to all the contract award notices published on TED in the period 2010-2017 for all the 28 European member states. A probit model is used as a methodology. Findings: The empirical analysis reveals that the use of competitive value is greater for larger value contracts, for national rather than local authorities, for the supply of other manufactured products and machinery; for research and development and business, as well as information technology services; and for construction works. The level of perceived corruption and the gross domestic product/capita do not have explanatory power in the use of the procedure, whilst a country’s degree of innovativeness, as measured by the global innovation index, positively affects the probability of adopting the procedure. A decreasing trend in the use of competitive dialogue over time is observed. Research limitations/implications: In conclusion, the countries examined benefited from a long tradition of public–private partnerships (PPPs) and from a transposition of the 2004 directive, able to provide an inclusive interpretation of complexity, and therefore, stimulate the adoption of the competitive dialogue in different sectors. Conversely, the countries, which postponed a concrete transposition and the overcoming of the confusing concept of complexity, limited the scope for the application of competitive dialogue, relying on the easier alternative: the negotiated procedure. Those circumstances lead to visible difficulties in stimulating the adoption of the procedure even in the traditional sectors; indeed, only with the new directive’s provisions a slight change in the trend can be seen. Practical implications: To foster the use of the competitive dialogue in countries that have so far used it to a limited extent is important to improve upon the definition of complexity and learn from the experience of the top usage countries, as identified in the analysis. Social implications: Helping the use of the procedure may facilitate the procurement of complex contracts such as PPPs, and thus, ease the building and management of public infrastructures for the provision of public services. Originality/value: The authors are not aware of previous studies that have used the TED data set and studied the law in a number of European countries so as to understand the usage patterns for the competitive dialogue.
Capability development measures adopted by public sector organizations in PPP projects delivery in developing countries
Purpose: The purpose of this paper is to evaluate the measures practiced by public sector organizations (PSOs) to develop their capability and strength toward attaining the skills requirements for public-private partnership (PPP) program. Design/methodology/approach: The study adopted a quantitative approach based on primary data obtained via questionnaire survey. The literature review provided the basis for identification of variables that were evaluated through structured questionnaire survey. The respondents were professionals in PSOs that have procured PPP projects in Southwestern Nigeria. These were sampled through the drawing of referral chain, involving respondents-driven sampling technique. The data collected were analyses using descriptive and inferential statistics. Findings: The capability development measures of PSOs in PPP projects delivery clustered around five components: conventional practices, training and development, organizational practices, human capital enhancement and government-aided intervention. These five components of capability development measures are expected to be focused with adequate and equal interest and embraced by PSOs in countries with evolving PPP markets. Social implications: The study provides implications for domestic human capital strengthening for enhanced infrastructure delivery in countries with evolving PPP markets. Originality/value: This study contributes to the existing literature on capabilities improvement on PPP projects. This was achieved by providing empirical evidences with respect to human resource boost for enhanced performance of public sector organizations in their partnership with their private sector counterparts for PPP project success.
Comparing public and private organisations in their quest to become a preferred customer of suppliers
Purpose: In industrial procurement, the concept of supplier satisfaction has gained increasing attention. Satisfied suppliers have been found to provide better prices, more innovations and priority in bottleneck situations. This paper aims to analyses in how far the concept of supplier satisfaction can be transferred to the public procurement domain. Design/methodology/approach: Two large quantitative data sets are compared, one from a sample of suppliers evaluating their industrial clients, the other from a public customer being evaluated by its suppliers. Findings: The same criteria which explain supplier satisfaction with its customer, which are relevant in the private and industrial case also hold true for the public case, namely, growth opportunity, profitability, relational behaviour and operative excellence are important criteria for distinction. Only relational behaviour by the customer scored significantly higher in the public sample, indicating that this is more an influencing factor for public organisations. Research limitations/implications: Showing the relevance of supplier satisfaction also for the public domain paves the way to further research better understanding how to measure satisfaction and how to increase suppliers’ satisfaction. Practical implications: Buying organisations are asked to apply a form of “upstream marketing”, in which they actively try to promote their organisation with their suppliers and increase its attractiveness. This is a new way to get access to better services from suppliers. Social implications: Analysing supplier satisfaction, on the one hand, allows to improve public purchasing acts, which generate social benefits in better using public money. On the other hand, caring for the well-being of suppliers is per se contributing to a socially more desirable world. Originality/value: Supplier satisfaction is a new concept in the public procurement domain. This is the first paper to introduce this approach.
Implementing sustainable procurement in the United Arab Emirates public sector
Purpose: Despite making significant strides in transforming its environmental outlook over the past few years and promoting sustainable procurement (SP) in the public sector, the United Arab Emirates (UAE) is still facing serious challenges in moving up the global sustainability ranks. Thus, this study aims to assess and prioritize critical factors, including cost, organization, innovation capability, stakeholder, culture and market-related factors, and their respective sub-factors for the implementation of SP, and come up with recommendations. Design/methodology/approach: This study uses the analytical hierarchy process model to prioritize the main factors and sub-factors that can critically affect the implementation of SP in the UAE public sector. Data were collected through a survey of 17 procurement experts working in procurement departments in public organizations in Abu Dhabi, UAE. Findings: The results reveal that cost is the highest ranked critical factor, followed by an organization, whereas innovation capability is the lowest ranked of the main factors. The initial cost of green products and their life-cycle cost are the most prioritized of cost factors. An individual’s commitment to change, top management support and organizational commitment are the highest-ranked sub-factors. Social awareness is the most important sub-factor among culture, and the supplier’s capability is the highest ranked sub-factor in the market. Social implications: The government should issue a standard practices handbook for SP to be used by public organizations to provide public procurers a clear method for conducting a proper cost–benefit analysis to evaluate and decide on sustainable purchases that fit the economy and society and meet the national sustainability agenda. Furthermore, additional attention needs to be paid to cultural factors such as social and environmental awareness by policymakers to succeed in achieving SP. Finally, top management and government officials must reevaluate their own personal values and commitment to sustainability issues as they participate in forming policies, rules, regulations and training programs designed for procurement managers within government organizations. Originality/value: Although considerable research has been conducted on this topic, this study is unique in its presentation of a critical understanding of which factors and sub-factors are likely to significantly affect SP implementation in the UAE, which shall provide the relevant researchers and practitioners with the necessary knowledge to be ready for the changes that may lie ahead.
Budget allocation design in the EU pre-commercial procurement for innovation
Purpose: Pre-commercial procurement (PCP), introduced by the European Commission in 2007, is the most important purchasing procedure available to the European Union public sector to solicit innovative solutions from the business sector. As such solutions are not yet in the market, they first require research and development (R&D) activities. PCP is concerned with procuring R&D services only, and typically consists of three phases. This paper aims to discuss how the budget available to the contracting authority (CA) may be optimally allocated along such three phases. Design/methodology/approach: The paper is mostly theoretical and the CA is assumed to maximise the overall probability of success in the PCP, that is the probability of receiving at least one successful proposal at the end of the procedure. Findings: The main finding of the paper suggests that, for a CA, the optimal budget allocation across the three phases of the PCP depends on how likely it is to receive successful proposals in various stages of the procedure, as well as on the rewards paid to the invited companies. Practical implications: In this paper, the author proposes a methodology for the optimal budget allocation of a CA and discusses how the approach could be practically implemented, pointing out its potential difficulties. Social implications: The main social implication of the findings is represented by the best use of the available budget, hence taxpayers’ money. Originality/value: To the best of the author’s knowledge, no existing paper has discussed the optimal budget allocation in a PCP as in this work.
Early contractor involvement (ECI): ways to do it in public projects
Purpose: Early contractor involvement (ECI) faces many barriers because it differs from traditional business practices. Public owners, especially, face a major challenge because they must comply with international and national legislation. The purpose of this paper is to develop a framework that illustrates the various approaches that public project owners can take to implement ECI. Design/methodology/approach: In addition to a literature review, three groups of case studies were carried out. The case studies were based on 54 semi-structured in-depth interviews with key personnel from 21 Norwegian public projects and document study. Findings: In all, 25 approaches to ECI were identified during the research. Twelve of these were used in the cases studied. Social implications: There are several approaches to ECI that are suitable for public owners. However, the contractor’s contribution depends on which approach is implemented and how it is implemented. Originality/value: As original contribution, this study presents a novel framework that defines options for implementing ECI in public projects. Furthermore, this paper provides insights on how ECI can be implemented in public projects based on Norwegian experiences. Although the empirical data of the study is limited to Norwegian public projects, this study contributes to knowledge about how to implement ECI internationally.
Factors influencing Malaysian small and medium enterprises adoption of electronic government procurement
Purpose: This study aims to examine Malaysian small and medium-sized enterprises (SMEs) Adoption of electronic government procurement (EGP) in the post-introduction phase as the portal was introduced in the early year 2000. Design/methodology/approach: This study integrated electronic public services into two acceptance theories (the technology acceptance model [TAM] and unified theory of acceptance and use of technology [UTAUT] framework) and having a direct measurement of the criterion. Both TAM and UTAUT models measure the behaviour intention to use and indirectly measure the criterion of actual usage along with behavioural intention. Besides, this study conducted a systematic sampling survey in SMEs located in Klang Valley (the business hub in Malaysia). Findings: The results confirm that effort expectancy, performance expectancy and social influences had a direct effect on the adoption of EGP in the private sector. Rather than the original UTAUT setup, the behavioural intention would influence user behaviour. Social implications: The implications and policy recommendations of these findings will be used by both SMEs and the government to improve the EGP delivery. Originality/value: The gap with this study is at the time the Malaysian Government introduced e-procurement. The SMEs were quite new and had limited knowledge in the e-procurement during the introduction phase. Both SMEs and the government will use the implications and policy recommendations of these findings to improve the EGP delivery in the current post introduction phase.
Grieving the loss of a public contract: De La Rue and the Brexit passport
Purpose: This paper aims to examine how firms react to the loss of a major government contract. Reactions to contract loss are yet to be properly studied in public procurement. Design/methodology/approach: The hypothesis is that contract loss triggers a five-stage grieving process, as predicted by the Kubler-Ross model. The hypothesis is tested using the recent UK passport contract in which the British supplier, De La Rue, lost to the Franco-Dutch supplier, Gemalto. Secondary data from corporate publications, news reporting, parliamentary debates and trade union press releases is used to compile the case. Findings: The findings show that De La Rue and its supporters passed through the five stages of grief in response to their loss. De La Rue initially exhibited denial by vowing to appeal the decision. Next came anger directed at the UK Government. An attempt to bargain was made during the standstill period. Depression set in after De La Rue admitted it would not appeal. Finally, acceptance was indicated by De La Rue pursuing new opportunities in the product authentication market. Research limitations/implications: The study is based on a single case. Further case research is warranted to test the external validity of the results. Practical implications: By debriefing unsuccessful bidders and listening to their viewpoint, public buyers can help to assuage the anger that accompanies contract loss. Social implications: Elected representatives, the media and civic society groups have vested interests in the outcome of contract competitions. Moreover, they use their agency in pursuit of their own interests, whether through political bargaining, lobbying or editorials. Originality/value: The paper demonstrates that the Kubler-Ross model of grieving has utility for understanding reactions to loss in a public procurement context.
Moving beyond one-off procurement innovation; an ambidexterity perspective
Purpose: The development of innovative procurement instruments can be costly and risky. To capitalize on successful innovative instruments, it is essential that these are reused. However, reuse can be problematic in project-based public client organizations. This paper aims to apply the ambidexterity concept of integration mechanisms to examine how such reuse can be facilitated. Design/methodology/approach: An initial framework is developed to conceptualize and contextualize the ambidexterity integration mechanism for the procurement function of a multi-project public client. Concluding that, in this situation, an organizational procedure is an appropriate interpretation of the integration mechanism, a design science project is carried out to develop and implement a procedure in a real-life setting. Findings: Reconstructed reuse patterns confirm the need to have an actionable integration mechanism implemented. Integration, in the sense of drawing benefits from successful one-off innovative procurement instruments, may fail unnoticed if not organized and deliberately managed. The procedure developed in the design science project demonstrates how such integration can be achieved. Originality/value: Although research on ambidexterity has grown exponentially in the past decade, it is yet to be applied in the field of public procurement. Furthermore, the application of design science research is novel in this field of literature. The paper illustrates how both can help solve a relevant organizational problem.